A recession looms on the horizon. Sadly this is more than the standard whisperings of pessimists. Instead, it’s an ever-increasing certainty – with a 98.1% chance of a global recession predicted by experts. Hiring strategy and HR outsourcing trends are adapting to meet this challenge – and in this article, we’ll explore how you can harness the most helpful opportunities to the advantage of your own SaaS operation.
Recession, as we all know, heralds a time of austerity, where cutting back on costs wherever possible is the nature of the game. This cost-cutting affects all facets of life and business, from consumers reducing their spending, to companies cutting on staff, salaries, and production. It’s a period that causes a great deal of worry across the board.
However, it is also important to remember that, periodically, recessions are inevitable – even normal. And for a business, a little forward planning goes a long way in staying afloat in a period of economic downturn.
With hiring freezes, staff cuts, and voluntary resignations, a recession can in fact bring about certain opportunities despite the challenges. With a realistic business forecast and recruitment strategy in place, companies have the ability to adapt to make the most out of a difficult situation.
Our top five tips for hiring during a recession:
1. Reassess Company Needs 🧐
Hiring freezes and cuts are common in periods of instability, but can frequently have a negative effect, with staff becoming overburdened with the heavy workload that is left for them to manage. The result is low morale and resignations – not ideal for any company invested in retaining its top talent.
Historical data from the 2008 recession gives a glimpse into how SaaS companies perform during a recession, with most growth rates slowing and dropping from 40% to 10% and no company being entirely immune to the impact. But with all the statistics and information gathered from past events, companies are better equipped to be proactive and forward plan.
Planning ahead will also ensure careful decisions can be made based on a rational plan, rather than as part of a more flustered reaction. Taking charge of the situation early on will enable a company to manage staffing requirements more efficiently. This could mean hiring more staff or hiring a more specialized team member who can cover multiple roles.
Whether the plan is to downscale, expand or focus harder on specific business aspects such as sales and marketing, planning ahead means you will always have the right people (and the right number of people) in place to do the job.
2. Hire Remotely 🌎
World events of the past few years have resulted in a notable shift in the employment landscape, with remote working becoming increasingly popular for both companies and employees. For SaaS companies, this trend is beneficial on multiple levels.
With a wider talent pool of remote workers, SaaS companies can more easily source candidates with specific, specialized skill sets, better suited to the SaaS jobs roles that are frequently being developed as companies evolve and grow. And the current HR outsourcing trends make hiring remotely far easier than ever before, with the option to partner with a global PEO (Professional Employment Organization) – providing a valuable and effective solution for companies looking to hire remotely, by legally employing the remote worker on behalf of the company in the international territory. So while the SaaS company can recruit the right person for the job, the PEO handles all of the legal requirements that come hand-in-hand with a remote workforce.
Not only that, but hiring remote workers is proving to be a more financially viable option – saving on office rental costs as well as the cost of poor productivity. One study has reported a massive $600 billion being lost annually because of workplace distractions. In contrast, remote workers usually bill only for hours worked.
Also, according to numerous studies, remote workers are found to be far more efficient, with some companies reporting 35-40% increased productivity with their teleworkers.
In essence, this means that by employing remote workers, you are not only able to access a far larger selection of talent, but you are also minimizing overhead expenses and reducing the risk of paying large amounts for non-productive hours.
3. Seize the Opportunities 🤩
It may be somewhat surprising to learn that times of economic downturn can in fact bring about opportunity. When most are focusing on rigorous belt-tightening, and many prominent companies announcing major layoffs, it is important to maintain a broad perspective of the situation.
It is a known fact that recessions result in layoffs and hiring freezes, but that also means that the competition for top talent slows down. There is also a growing trend of voluntary resignations during periods of uncertainty. This is largely due to another cost-reducing method of cutting down on compensation and benefits, sending many great employees off in search of brighter opportunities with better job security and remuneration.
The result is that the talent pool is far larger than usual, making it an excellent time to recruit top-tier employees that were previously tied up in other jobs.
4. Be Flexible 🧘🏻♀️
It is especially important during a recession that salaries remain competitive. This may require that salaries are reduced to keep in line with market trends, and in this case, certain flexibilities can be introduced to attract new talent and to ensure that current team members within the company stay satisfied.
With one study reporting around 60% of respondents showing a preference for benefits over a pay increase, benefits packages present an excellent opportunity in maintaining staff happiness levels.
There are a number of flexibilities that can be introduced. Some of them do not present an extra cost for the company but do make the job all the more appealing – such as a work-from-home option, or flexible working hours. Other benefits which come highly sought after include health insurance, pension scheme contributions, child care assistance, added skills training, gym memberships, and additional time off and holiday.
In short, an attractive benefits package can work wonders in attracting and retaining top employees. All it requires is some good planning and flexibility.
5. Be Ready to Go Global
Unprecedented events can also bring about new challenges involving the need to hire remote teams or relocate certain employees overseas. This is where outsourced HR experts are extremely valuable. Not only do they assist in navigating the challenges of ensuring the hire is done in a compliant manner, but they also assist with all of the employment-related administration.
What this means for companies is that remote roles can be filled more efficiently, while also saving on the expenses, time, and difficulties of doing the remote recruitment in-house.
A global HR outsourcing company streamlines the process, by providing the assistance of a PEO, which allows companies to hire staff from anywhere in the world – without establishing their own legal entities in those countries. Additionally, they can offer a Global Payroll service, which allows employees to be paid compliantly with regard to all tax and legal requirements.
An important aspect to consider – using a global HR outsourcing company means employees are just that – employees, not contractors. This means that they are entitled to all the benefits the job entails, which also goes a long way in attracting the best candidates.
Hiring During a Recession can Be Effective When Approached Correctly
It is important to analyze the bigger picture and, wherever possible, to reframe challenges as opportunities. On average, recessions have lasted around 10 months – which is no doubt tough for most businesses – but in the greater scheme of things is a relatively short storm to weather.
Forward planning is essential for effective hiring during periods of economic decline, and while competitors are making cutbacks and taking cover, a smart business can take advantage of the situation and implement measures to meet short and long-term recruitment goals.
Since trends are not just retrospective, and future trends can be predicted based on proper analysis of historical events, changes, and choices, HR outsourcing trends can also be the subject of a little “crystal ball gazing” in order to plan and execute strategies for surviving a downturn.
In conclusion, while storm clouds may be gathering, business leaders are not alone in navigating the impending challenges, and can always count on the assistance of experienced outsourced HR professionals, adept in managing and advising on recruitment in challenging times.
Agile HRO is an international human resource outsourcing company that provides businesses with a way to quickly hire and expand teams by offering a global PEO, EOR, mobility and payroll solution. Recruit the best remote candidate for your company, and let Agile handle the rest.
Ready to expand your workforce globally? Read on to find out more about: How to unlock the key advantages of global human resource management