If The Recession Is Coming, What's Your Plan?Nov 30, 2022
It seems everyone, from front-porch philosophers to well-educated think-tank economists, is predicting a global recession is imminent. While this may or may not occur, this situation presents challenges and opportunities.
For example, if you are considering a career change, from being an employee to becoming a freelancer or virtual assistant, this period of economic uncertainty could be a gateway to a new, fulfilling life. All it takes is vision, guidance, and the courage to change your life for the better. Easy. Right?
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Recognizing the Opportunity
In times of economic uncertainty, one factor is consistent. It is a scary time for all concerned - from the CEO to the employees. Boy, is it scary! However, it also holds great opportunities.
According to successful entrepreneur and founder/CEO of Virtual Expert®, Kathy Goughenour, “Situations such as a declining industry or a company that can't seem to 'make ends meet' are clear signals to look out for yourself and seek a more stable work environment.
"The old rule that having a job was stable and secure is no longer true and hasn't been for several years. The new rule is that having your own business, with multiple clients, is what true security and stability look like today. When you have multiple clients, even when you lose one, you still have the other clients who pay you. Additionally, if you've built the business with a strong, sustainable foundation, you also have an email list and a network of people you can reach out to and easily replace that lost client.
"If you've been waiting for a sign that this is the right time to start your own business, a recession and the threat of layoffs may be that sign. One great strategy is to start your business 'on the side' in preparation for the potential layoff. If the layoff DOESN'T OCCUR, you can grow your business until you've replaced enough of your income or built a nest egg to tie you over while you continue to replace that income. If the layoff DOES OCCUR, you're not starting from scratch. You already have your business going and can leap into it full force."
Tell-Tale Signs It May Be Time to Move On
If it were possible to sit down with a grandparent or great-grandparent and ask them how the world looked JUST BEFORE the Great Depression, they would likely say, "We saw it coming, but it just kept coming!" While it is very unlikely the potential recession predicted for current times will be as destructive as that which led to the economic collapse of the 30s, there are certainly signs to watch out for.
As someone who has worked for large companies, Kathy's corporate radar is finely tuned. She points out some tell-tale signs that a company may be struggling.
"I encourage my clients to watch out for these factors," she said.
- Your company has already been laying off people.
- Your company is hiring outside consultants. This is typically to determine how to restructure and that always means layoffs. Consultants help determine how many people can be laid off without damaging the company.
- You've been asked to complete a questionnaire about what you do, who you report to, and your role in the company.
- You've been asked to re-interview for the job you have.
- Your company is experiencing a lot of financial losses and poor earnings.
- There are signs of a merger or acquisition. Positions become redundant when companies merge.
- Budget cuts are occurring.
- People at the top are leaving.
- The company isn't investing in its people.
- You're no longer in the loop.
- You ask your manager if layoffs are coming, and they can't give you a definite NO.
- There are whispers of layoffs in the workplace.
- You've had a bad review, and you're seeing other signs that there may be layoffs.
- You were recently hired — often, the rule of layoffs is last in, first out.
- An emergency, all-employee meeting has been scheduled.
- There is a hiring freeze.
All, or some of these changes, suggest it may be time to seriously consider a more secure job. For many, this means taking control of their lives and becoming a freelancer or virtual assistant.
Get Your Ducks in a Row
When you finally reach the point where the fear and anxiety are making it difficult for you to get out of bed and go to work, there are several moves to make as soon as possible.
"Panic is not a productive use of time," Kathy said. "Urgency, however, is called for.
"I recommend that an employee get all they can from their current job. Use paid time off if you cannot get it as a lump sum payout if you quit. Get access to training and other on-the-job opportunities that can help you in your next career. Understand your retirement savings or pension benefits, bonuses, soon-to-be-vested stock options, and other benefits, and time your exit to make the most of those benefits.
"Shop for health insurance. Get quotes from health insurance brokers to identify the best insurance for your needs. Then factor into your budget the cost of health insurance.
"Investigate non-compete clauses in your employment contract to ensure you're clear to start the type of business you want to start. If you're unsure, it could be worth paying an employment attorney to make sure of the rules around non-compete clauses.
"Use your current 'day job' to fund your freelance business: You can do this by starting your freelance business as a side hustle before quitting your job, and saving the money you earn from your freelance business while you're still at your job — or use it to pay off high-interest-rate debt.
"Determine the amount of savings you need to cover expenses, including those health insurance premiums, before quitting. Consider this your 'freedom fund' because it gives you the freedom to make decisions without finances freaking you out.
"Get references from key people in your place of employment. You never know when these might come in handy in the future!
"Finally, resign in compliance with any required rules and timeframes. Be gracious. Share your contact information with your favorite colleagues. Gather their contact information. Show gratitude for all the things you learned and were able to do during your time at the job."
Time to Transition
Some employees understandably worry about a recession and how it might affect their job and their family's security. Unfortunately, handwringing just makes for chapped hands. It doesn't change the situation. While using an economic downturn, or recession, to become a freelancer or virtual assistant may be scary, the alternative can be terrifying.
The best approach might be to use this time of uncertainty to slowly transition to a better life. Ironically, becoming a freelancer or virtual assistant might be the most secure option available.
If a recession changes everything for you, are you prepared to find security in your own work? We can help. Book a free Breakthrough Session and find out how.
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