What does the looming recession in Australia mean for staff retention?

Will Australia experience a recession or not? That's the question on everyone's lips; especially small business owners. The uncertainty, which is largely being fed by the media, is excruiciating. As a planner and an HR Consultant who is interested in people retention and high performance, I am curious as to the future for Australian small business.

Reading business news items from the UK and USA it would appear that the impact of their recessions is still largely to hit businesses. It is certainly being discussed, but no one is saying they have actually felt the tightening as yet.

All this talk and hype will be impacting negatively on your employees; making them feel insecure and unstable. This is a risky time for employers who have high performers. If high performers get a sniff of uncertainty from you, they might pack up their desk and look for more stable pastures. Recruitment is a costly and difficult exercise at any time, but it is more frustrating when it interrupts your business flow during already difficult times. We should all be aiming for strong staff retention.

Tips on keeping your staff during a recession:

• Offer flexible work arrangements - this is a good non-financial motivator and quite attractive to many employees. With compensation tipped to decrease by 20-30% in the UK in coming months, employers may be looking for non-financial rewards to entice high performers
• Invest in training - training your staff will significantly impact on productivity. It is much cheaper to invest time and money into training your existing staff, than to recruit new ones. You will also have a great workforce, ready to achieve fabulous outcomes when the economy gets better
• Maintain good quality service - set high expectations of your staff to deliver quality service and let them know if they aren't meeting your expectations; give them guidance on how to do it better. During these times you want to make sure the service at your front end is keeping every possible customer loyal to your business. You simply can't afford for poor services to loose you a paying customer.
• Adopt some creative marketing strategies. Marketing during a recession is really different to marketing during good times. If you have some spare staff due to a slow down in business, get them working on a marketing project for you. After all they probably know what your customer wants more than you do! Look at it as a professional development project for your staff. There is heaps of free information on the web these days for them to research and you might be pleasantly surprised at what they come up with. Besides employees hate being bored and this will keep them active. Also, use this opportunity to phone or visit past clients and catch up on their lives. Maintaining a rapport with customers is key to maintaining your client list. Often this gets over looked during busy times.

More than ever it is important to make your staff feel secure within your business. Keep them informed of the state of play. Don't be worried about scaring them with your reality, as not communicating might lead them to worrying more, which will inturn lead to ineffective performance - this could make the situation even worse!