CIPD Voice On… operating in a downturn, by Katie Jacobs, CIPD’s senior stakeholder lead. 

After the challenges of the last two years, it would be fair to expect or, at the very least, hope for a break. Instead, we are facing the exact opposite. People professionals and organisations are beset by a perfect storm of challenges: impending recession, rising operating costs, a cost-of-living, housing and energy crisis, the war in Ukraine, pressures on revenues, a talent and labour market crunch… It’s relentless and overwhelming, and many in the profession are tired and burned out. Crisis follows crisis, without a moment in a steady state to recuperate.

So, how to deal with this? First, it's critical to understand that the current environment presents the second challenge in as many years that is impossible to solve perfectly. Appreciating that fact gives people professionals an important mental shield to protect their own wellbeing.

We promise the point of this article isn’t to make you (even more) despondent, but most indicators suggest that things will get worse before they get better. Against this backdrop, it will be impossible for organisations to please all their stakeholders, but they and people professionals within them can act in a responsible manner. Because being a responsible employer doesn’t mean making everyone happy all the time, but rather doing hard things and making tough decisions in the right way.

There is not one silver bullet, so people professionals need to get creative when thinking about how to support organisations and employees through the cost-of-living crisis in particular. Ideas recently shared in our sessions with chief people officers include one-off payments, the establishment of hardship funds, on-site perks such as free food, even reviewing IT equipment to ensure it’s as energy efficient as possible.

Some of the solutions offered through previous crises, such as asking people to take pay cuts or work fewer hours, may not be workable due to the pressure of inflation on individuals. Every organisational context is different, and we must strive to balance the interest of all groups as mindfully as possible. The impact of the cost-of-living crisis is also uneven, in terms of geography, flexibility of role, seniority and more. That means solutions need nuance: people you don’t expect may be struggling, but the fear of being wrong must not prevent us from providing support where we can.

Unfortunately, we recognise that a time may well be close when organisations must choose between protecting their financial stability, their long-term operating sustainability, their customer offering and their people. More often than not, these things are aligned but sometimes there are no good options. It may be that short-term pain is necessary to protect the long-term.

Through the organisations’ difficult choices, the role of the people professionals is to create the space, and to insist that these choices and the implications – short, medium and long-term – are properly considered, backed up with data and insight. And in the event of organisational downsizing or reshaping, we must do what is needed not just legally and technically, but with compassion and care. The impact on those who leave and those who stay, and how things are handled all send powerful messages about the organisational culture and the values of individuals.

Discussing, making and managing these tough choices can be draining. It’s tempting as people professionals to take its weight on your own shoulders, to feel personally responsible for every reaction or outburst. Compassion and support are paramount in the profession too, just as it is for the rest of the organisation. Self-care isn’t selfish: it enables you to care more effectively for others. As a profession we must not rush to judge individuals or organisations, especially as the full insight and context behind decisions is often not publicly available. As your professional body, we commit to doing the same – to calling out poor practice but equally to understanding that sometimes unpalatable choices must be made and that it is the people professionals who often bear the brunt of enacting what may be necessary, if unpleasant.

Over the last two and a half years, our profession has shown itself to be creative, caring, expert and resilient. Its profile has been raised, as has its credibility (meaning the expectations of leaders and employees have also been raised). We should take heart from the fact we have risen to an ‘unprecedented’ challenge before and have faith we can do so again, but not without recognising that the support and community of our peers is a vital component of steering our organisations, our people, our teams and ourselves through a challenging winter ahead.

CIPD resources to explore: 

Guide: Workforce planning
Tips for assessing transferable skills and redeploying staff
Factsheet: Redundancy 
Guide: Managing the redundancy process
Employment law: Redundancy Q&As
Cost-of-living crisis hub: How to help your employees at work 
Wellbeing helpline services for CIPD members