Ask a Resourceful Human: How can I maintain employee morale during an economic downturn?

Welcome to our regular HR advice column, Ask a Resourceful Human. Here to answer all of your burning questions is Erin Grau, the co-founder and COO of Charter, a media and services company that aims to transform the workplace. Erin has over 15 years of experience at the intersection of talent and operations in global organizations and startups, including the New York Times and Away. You can sign up for the free Charter newsletter about the future of work here.

If you’ve been reading the economic tea leaves, chances are you’ve been preparing your organization to weather an economic downturn for some time. Is maintaining employee morale part of your plan? It should be. But how can HR keep employees’ spirits up amid economic uncertainty?

Layoffs, wage freezes, and hiring slowdowns can hurt employee morale and productivity, not to mention HR departments’ ability to retain and support them. The good news is that many of the high-impact levers you can pull to keep employees’ spirits up are virtually free.

Build a culture of trust and transparency. Some 65% of US executives who responded to a survey by PwC said they’re focused on developing or refining their trust strategy with stakeholders, including employees. Ensure it extends to your corporate culture by:

• Making sure leaders follow through and that their words and actions line up.
• Listening to employees, turning their feedback into actions, and sharing the actions and results.
• Talking about what’s working—and what’s not.

“We owe it to our people to get really specific about where we’re growing, where we’re shrinking, where we think we have the most risk,” Francine Katsoudas, Cisco’s chief people, policy, and purpose officer, said at Charter’s Workplace Summit earlier this month. “In doing so, we give our people a lot more power as well.”

Connect to purpose. The Covid-19 pandemic led nearly two-thirds of US workers to reflect on their purpose in life, according to a 2021 McKinsey survey. As 70% of respondents said their sense of purpose is defined by their job, managers have an important role to play in helping employees find—and live— their purpose. Employees, McKinsey found, are also five times more likely to be excited to work at a company that spends time reflecting on its impact in the world. HR, this is your cue to:

• Share stories about the ways your company has positively affected customers, partners, employees, and communities.
• Encourage your employees to reflect on their individual purpose and how it connects to the organization’s purpose. Workers who do this are three times more likely to feel that their purpose is fulfilled at work than those who don’t, McKinsey reported. Articulate your own purpose to model how it’s done.
• Start a conversation. During a recent offsite, my team read workplace consultant Lakshmi Rengarajan’s reading, “A Reflection: Work Can Be the Music of Human Potential” to lead into a conversation about purposeful work.

Recognize and appreciate employees. Gratitude can have an outsized impact on morale and engagement. Indra Nooyi, former CEO of PepsiCo, would write letters to her employees’ parents recognizing them for the “gift of your child to our company.” In addition to that thoughtful approach, you might also consider shouting out employees in a Slack channel dedicated to praise and recognition (like #team-love), sending employees handwritten thank you notes like HubSpot’s CHRO Katie Burke, or setting aside time in meetings to celebrate wins.

Cultivate connection. Increased morale is just one of many benefits of prioritizing connection-building and socialization at work. Employees who have a best friend at work are more likely to be engaged and productive and enjoy a positive employee experience than those who do not, according to a Gallup survey. Help create intentional connections by:

• Focusing on one-on-one relationships. Pair employees and give them two minutes to find two things they have in common, then add more team members to the mix. You might also use tools like Slack plug-in Donut to encourage virtual one-on-ones.
• Encouraging mentorship. Whether or not you have a formal mentorship program, challenge managers to connect their employees with mentors throughout your organization.
• Walking the talk. Make it your own goal to have one non-job-related conversation each week.

Above all, don’t forget to be gentle with yourself and take time to unplug and recharge. HR is often at the center of unrelenting crises and challenges, and you can’t keep employees’ spirits up if yours are down. Plan some PTO or block off time on your calendar to do something that gives you energy this week.—EG

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