COVID-19’s impact continues to be felt throughout businesses, especially in Australian SMEs. However, as they begin to recover from the challenges faced over the last three years, they now need to prepare for a potential recession. A recent survey by GoTo and OnePoll found 79 per cent of Australian business owners believe one will occur in the next six months. Amongst this chaos, SMEs need to ensure employees feel engaged and supported through economic uncertainty.
Economic uncertainty impacting employees
The onset of COVID-19 has led to a series of supply chain disruptions and labour shortages, spiking the cost of living and disturbing the economy. This has had a significant impact on the way we work. GoTo’s survey found that 56 per cent of business leaders felt COVID-19 has impacted the way employees now work and act in 2022. Furthermore, 41 per cent cited inflation and the rising cost of living as affecting employee choices with working.
Ensuring employees are safe and engaged during economic uncertainty can be difficult, especially when dealing with smaller budgets and resources compared to larger organisations that may have more resources at their disposal. For SMEs, there needs to be a focus on transparency and strategy in how budgets are utilised.
Honesty is essential
SMEs that remain open and honest with employees during economic instability will reduce insecurity and instability amongst staff. Communicating effectively and clearly across a range of channels about business updates, regularly checking in with employees about their well-being, and seeking feedback will build a trusting workplace and a culture that large-scale businesses envy.
Showing size doesn’t matter
Demonstrating to employees that the business is taking the right steps to withstand economic instability brings peace of mind to employees, as concerns can raise when working for an SME that they would be safer working in a larger company. Many businesses are taking actions such as creating business continuity plans (47 per cent), having a product that is cost-effective to produce (46 per cent) and improving employee morale (46 per cent) to prepare for economic uncertainty. To add further stability, businesses can look to save three months’ worth of profits as an emergency buffer, diversify business cashflow and consolidate their technology stack.
Technology is key
Technology has become integral for SMEs to navigate employees during economic instability. Eighty-four per cent of Australian business owners believe ensuring employee devices are working properly is vital to be prepared for future issues, which coincides with the fact 71 per cent of businesses are now updating employee devices annually. When businesses implement the right technology for employees, they create a higher quality work environment, and bring ease to work operations, reducing stress and increasing success.
A variety of factors will continue to impact the economy. As businesses prepare for an economic downturn, it is critical that SMEs’ business decisions relate back to engaging and protecting their employees. Transparency is vital, and by effectively utilising budget to implement the right technology, improve morale and prepare for a recession, SMEs can ensure their employees remain engaged and supported through economic uncertainty.
