The U.S. economy is not yet in a recession, but the warning lights are flashing. Economists say the risk is rising that the country will be in a recession within the next year, which means businesses need to take steps to protect themselves against a potential downturn.
As part of those preparations, businesses have to decide whether they should consider hiring during a recession or outsource certain roles or business functions. There is no one right answer that applies to every business, but these are some of the key factors to consider in deciding whether your business should outsource, hire internally, or both.
What’s your budget when hiring during a recession?
Do you have the budget necessary to hire a full-time employee, and the consistent resources to continue to employ them during a recession? If you don’t have enough or aren’t sure you will if your business contracts, outsourcing is an appealing alternative that provides more financial flexibility.
How predictable are your revenue and expenses?
If your business is growing rapidly or in a transition period, the flexibility of outsourcing may be appealing. You can scale up or down as needed, adding or removing services based on your changing business needs, instead of worrying about whether your internal employees can handle new tasks. If you are confident that your business will have more predictable long-term staffing needs, then a direct hire may be the right solution.
How difficult is it to find qualified employees?
The labor market is tight, and it could get even tighter during an economic downturn. If that’s the case in your industry, you might want to find and hire qualified employees now. That way, you won’t be searching for new hires in the middle of a recession, when you’ll likely have the least amount of time and resources to devote to the task.
What’s best for your existing employees?
Layoffs are an unfortunate reality during recessions, and they often result in extra work and overtime for remaining employees. Especially with today’s high burnout rates, this added stress can be harmful to morale and could lead employees to leave the company. If this is a worry for you, it may make sense to set up a relationship with an outsourcing provider now, so you can task them with any extra work that arises during a recession.
What are your goals?
Along with the above considerations, make sure you think through the short-term and long-term goals you have for each department and for the business as a whole. How many employees would you like to have, and in what roles? Is outsourcing a short-term fix or a long-term part of your business vision? Answers to those questions will help you determine how to approach hiring and outsourcing in the months ahead.
Get the support you need
Insero Talent Solutions can help. We have a team of experts and a pipeline of talent which allows us to provide affordable direct-hire solutions to companies of all sizes. Or, if you’re looking for other options, Insero’s Outsource Accounting Services Group can provide outsourcing and co-sourcing solutions on a temporary or long-term basis.