Batten down the hatches, but don’t throw the baby out with the bath water

by Nick Holker, Peer Group Communications

On most days at the moment, I Iisten intently to over-excited economic commentators, scan the financial pages avidly and even download the odd podcast in an attempt to find some good news on the economy.  I am sure I am not alone.

Like anyone who saw the boom and bust cycles of the late 20^th century metamorphose into a decade and a half of steady growth, I'd rather not see a return to the old rhythm or, worse still, a ‘period of correction' that lasts as long as the ‘unprecedented period of growth.'

Recently George Soros (of whom the Times says ‘when he speaks, the financial community listens') was expounding a theory that the economic superboom we've enjoyed since the end of World War II has now come to an end, and the only people who'd really benefited were mega-speculators like himself.  You're left wondering whether we've already lived through the best of times and it's all downhill from here.  Neighbouring headlines which shout ‘The end of capitalism as we know it' or ‘Fear stalks the City' don't really help.  There is some good news, though; unemployment continues to fall - down by 32,000 in the three months to the end of January, according to government figures.

The trouble is that the very next item - ‘City fears job losses from credit crunch' - features a forecast by the Centre for Economic Business Research of potential cuts of around 10,000 city jobs.  Since the financial services sector accounts for about eight per cent of the UK's wealth, alarm bells must be ringing from Aston Martin to Zara.

One of the significant features of our recent sustained economic growth has been that many organisations have been able to build their employer reputations in a consistent and planned manner.  This is in stark contrast to the 70s, 80s and early 90s, when the UK had the most volatile cycle of any major economy. Then, long-term manpower planning was all but impossible.  Employer reputations which were built up through concerted effort over a three to five-year period were often dashed at a stroke, whether through the need to make large-scale redundancies or simply by a prolonged period of absence from a major recruitment segment - such as the graduate market.  In either case, the repercussions would have been suffered long after the hiring freeze thawed.

Whether you care to call it employer branding or simply a practical response to the need to recruit, retain and manage talent effectively in an ever more competitive world, the increasing focus on identifying, articulating, communicating and developing the elements that distinguish one employer from another suggests that organisations are continuing to invest for the longer term.  This is particularly true for global companies looking to fine-tune their propositions for local markets.

Because the process of determining and managing how employees and potential employees engage with an organisation is necessarily an ongoing, long-term activity, it would be a tragic waste if the progress currently being made by so many employers was to be interrupted as a result of cost-cutting measures.  Indeed, short-term actions could well turn out to be a false economy.   Much of the working population is feeling the effects of increases in the costs of fuel, food, energy, mortgages and taxation; organisations that can communicate with empathy and motivate their people to give of their best at times like these will win huge support.  It is also vital that they maintain a positive image externally in order to attract the new talent needed to make the most of changing conditions.

Since even the most experienced economists are unable to predict how deep or how long the much heralded slowdown is going to be, it is to be hoped that it is not only swift but also that it doesn't undermine the genuine efforts being made by so many organisations to be employers of choice.