Recesssion Can Mean Opportunity
Fearing Fear Itself
Depending on whom you read, our country is either now in or is on it’s way to the deepest recession in decades. In other words, we are in a period of economic chaos, of shifting priorities and huge uncertainty.
Congratulations! Sound crazy? Well, put aside your understandable fears for a moment and think about it this way: this period could, if we let it, become one of opportunity, innovation and growth that’s far more meaningful than “increasing shareholder value.”
But first we need to address news that’s slanted to our fears, like this post from i4cp.com.
The headline, “For Most Companies, Layoffs are Tough To Avoid,” is definitely scary enough to make you hold on, white-knuckled, to your cubicle. And yes, the statistics from the recent i4cp.com study are sobering:
- 6 out of 10 companies have trimmed their workforce in the past year, and 48% of those companies expect to do so again.
- Thirty-nine percent of all companies foresee cuts coming in the next 6 months.
- Seventy-one of companies with more than 10,000 employees have reduced their workforces, with more than half of such companies saying they will do so in the next six months.
Smaller May Be Better
So, if you work for a very large company, you may well be in trouble. But guess what? Larger companies (those that employ five hundred or less) comprised only .1% — that’s less than a tenth of one percent — of the companies in this country in 2007, according to this FAQ sheet by the Small Business Administration’s Office of Advocacy.
Smaller companies have generated 60-80% of the new jobs created in this past decade. And while some, or even many, of our country’s smaller companies may face some greater risks at this time, they are also far better equipped to find innovative solutions to help themselves and their employees ride the tide.
So perhaps one lesson we can take away from the current economic situation is that it really is better to be bigger fish in a smaller pond than a nameless guppy at a behemoth like GM.
From the Ashes, Opportunity
Still think we’re nuts? Consider this sentence from a March article published online by MSNBC:
What do MTV, Trader Joe’s, and the iPod have in common? … the most interesting thing about all three is that these great brands were born during recessions.
The article’s authors, G. Michael Maddock and Raphael Louis Vitón of Maddock Douglas, go on to say:
Cutting across the board is the coward’s way of dealing with a downturn. It assures that no one is going to yell — how could anyone possibly object to sharing the pain equally — and it gives the timid a built-in excuse to fail (emphasis ours).
Granted, Maddock Douglas is a marketing company, and some of their article is comprised of quotes as to why other companies shouldn’t cut back on their marketing. But — Trader Joe’s. MTV. iPod. It’s worth thinking about.
The Worst of Times, the Worst of Times — If This Is Really “It,” What Will You Do to Help?
Given that our current economic chaos/opportunity is being likened to the Great Depression of the 1930’s, we here at the Blawg took a moment to research unemployment during that time.
At the height, or rather the depth, of the 1930’s depression, we had a 24.9% unemployment rate, compared with the 6.1% rate cited by the U.S. Department of Labor for September of this year (a number that admittedly does not include approximately 1.1 million workers who have at least temporarily given up the hunt for work).
We’ve got a long way to go to reach the worst unemployment rate of the past 100 years; but look at it another way – even during the Great Depression, three-quarters of our people were working!
And what else did the Depression give us? World War II aside, Americans learned two important things during those years: how to save money, and the importance of a social safety net — with both governmental and private elements.
Whether person to person — the housewives who traded a warm meal in exchange for a few hours’ work around their yards — or through government programs like Social Security and public works projects, this country’s citizens pulled together, realizing that while almost everyone was suffering, everyone could also pull together to make life better.
The Great Depression was, above all else, a great equalizer. And given that economic inequality is higher right now than at any point since about the 1890’s, perhaps being reminded of the ways we’re all connected won’t be such a bad thing after all.
So — if you are facing the prospect of a job loss now or in the near future, you have our condolences and we’re pulling for you. Ditto, and even more so, if you’ve already been on the wrong side of a downsizing.
We also encourage you to keep your faith in yourself and in our country strong, and to not only think outside of the metaphorical box, but to shred that box as you decide and work to achieve whatever is next in your professional life.
If you are now or stay relatively secure financially, we have a challenge for you — what can you do, right now, to help someone in need? Whether it’s helping your unemployed friends (and friends of friends) network into new jobs, doing some volunteer work, or making your voice heard with our incoming Administration and Congress about the needs of the real common Joes, we encourage you, too, to take part in creating opportunity from the current chaos.
This Turnaround Will Require A Culture Change
Nor are we (the writers and most of the readers of this blog) the only ones being called on to change and grow to meet this challenge. Our leaders also need to adopt a new set of ideals in order to re-earn our confidence.
George and I think that Rosabeth Moss Kanter said it best in this post in Harvard Business Publishing on Oct. 29:
Confidence will return when leaders guide investment to the real economy that produces goods and services, not the world of financial engineering. Confidence will return when leaders call for innovations that improve lives while creating jobs and health-promoting or energy-saving technologies. Confidence will return when leaders see that they must reduce the income gap between top and bottom – something that a Goldman Sachs executive said in a public meeting, while worrying that he might be quoted.
So whether you’re a “regular Joe” or a CEO, a Senator or a janitor, we are all in this together. Or as a certain Presidential candidate has very aptly said: we are the ones we’ve been waiting for. Let’s not wait for things to get worse before we commit to working — together — to make them better.