If you've been staying up to date with the current state of the world and listening to the news, you've most definitely heard talks about a possible economic recession. The thought of a recession is terrifying because it does not only affect our economy, but it brings fiscal hardships, sometimes including layoffs, to families and individuals.
For candidates on the market, new hires, or individuals that feel they will be the first cut from their position due to market conditions, you need to understand what would cause a recession and what that will mean for job security.
Although I am not an economist, from my research, the most significant facet determining a recession is inflation. Although the United States is not currently fighting in the Ukrainian and Russian wars, our economy is impacted heavily by the decrease in the imports of oil and crops and our ability to offer aid.
The war in Europe directly impacts the cost of our goods, causing a rise in inflation by 8.3%, the highest increase in over 40 years. The Federal Reserve came out with 3 model predictions of the likability of a recession happening, and two of the models showed a low risk of it happening. On the other hand, the overall analysis shows a rise in unemployment.
If you feel concerned about your job security, do not panic. It is natural to feel worried or anxious. Here are some steps we recommend to take if a recession hits that you are equipping with a plan of action.
Update your resume and portfolio
Unfortunately, a way people are most affected by a recession is layoffs. Although layoffs are unpreventable, the only way to deal is to be proactive.
Whether you are looking for a new position or forced to, we recommend updating your resume and portfolio. If you are affected by a layoff, you will be one step ahead of others and can jump into the hiring and application process.
Budget - Increase Emergency Funds
A recession is a time of distress and chaos, and the cost of products and goods changes rapidly, so we recommend doing what you can to budget and save. If you have any credit card debt or have something to pay off, do it sooner than later.
The more you save and budget, the better off you will be. In general, you should save up to three months of your rent/mortgage payment in an emergency fund, but in a recession, you should have three to six months in savings. If you are someone affected by a layoff, you will have the finances to support you until you find a new job.
Consider freelance opportunities
When the economy is rocky, employers refrain from hiring full-time employees, and many turn to closing open positions or looking for temporary solutions.
It may not be ideal, but freelance positions are a great alternative if you have lost your job or are fearful you might be affected by a layoff. A freelance opportunity as your direct source of income or as a side-gig is a terrific solution.
At Clutch, we are always staffing freelance and temp-to-hire positions, and we find that the hiring process is much faster. If and when you are in a bind and need a new job almost immediately, freelance positions become favorable.
At the end of the day, we hope to do whatever possible to prevent a recession, but the best way to prepare is to accept that this may be a possibility and prepare for the worse. We hope these tips helped, and if you are struggling to find a job, we would love to assist you, shoot us an email at email@example.com.