Cut Now? Later? Not At All?

The beginning of the week brought ominous economic and financial news. By midweek, some of the gloom was fading, but the brief dip does bring up a major question: When should leaders start preparing organizations for an economic downturn? Korn Ferry experts look into the issue. Plus, in uncertain times like these, we offer ways to work well with your manager and maintain job security.

1) Time to Pull Back?

It didn’t take much for worries about a recession to come roaring back—just a pessimistic US jobs report and one very ugly day in the world’s financial markets. It was only a matter of time, it seemed, before leaders would announce a wave of cost cutting and reorganizations in anticipation of a big economic downturn. Conventional wisdom went from “soft landing” to “sky is falling” in about a week. But the market’s sharp recovery a day later, experts say, gave corporate leaders—and investors all over—a serious case of whiplash.

To be sure, there are plenty of signs of an economic slowdown, or at least a lack of growth. According to FactSet data, S&P 500 companies grew their revenue by 5.3% in the second quarter, which is significantly below the five-year average of 6.9%. Over the past three months, the number of new jobs in the US has declined, while the unemployment rate, now 4.3%, has risen to nearly a full percentage point above its post-pandemic low. Hiring experts have said that the economy has been in a “white-collar” recession for a while, wherein companies have been hesitant to fill professional roles unless it is absolutely necessary.

But many leaders have already accounted for this slowdown.  

Read the full article here.

2) 5 Ways to Keep Your Boss Happy

The recent news on job hiring, combined with tough news from Wall Street, has made it very clear to many workers: This isn’t the time to switch jobs.

But staying put isn’t just a matter of keeping your head down, experts say. Now is the time to make sure you are working well with your manager, because rank-and-file employees aren’t the only ones feeling the pressure. Your boss and his boss are also under the gun in today’s market. Given these conditions, it’s important to have empathy for your boss. So how can you keep them happy?

Read the full article here.

3) The Summer of Distraction

Corporate leaders have always worried about distractions—whether for consumers shopping, clients making business deals, or people working from home or the office. But experts say that the news lately has been overwhelming.

This week alone, the stock market seemed headed for a crash before recovering somewhat. That was on top of earlier news about a sitting US president deciding not to run for reelection, his predecessor surviving an assassination attempt, and constant updates on two wars. Even the Olympics have been a distraction, reportedly costing firms billions of dollars because of workers and consumers who are glued to TV or other screens.

Leaders are now concerned that the year’s second half will be subject to even more distractions. Even before July’s weak jobs report sent markets into a tailspin, several large retailers cited the negative news cycle as a key factor in a decline in both consumer spending and estimated sales and profits.

Read the full article here.

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Check out Briefings, our bimonthly national magazine, for in-depth and unusual looks at critical leadership issues.