🚀We’re Officially In A Recession. Here Are 4 Things You Can Do To Make Yourself Recession-Proof!

We kinda had the feeling we were already in a recession. The signs were all there. Things were getting grimmer by the minute. But now we’ve actually got the data to back up our suspicions: we’ve had six months straight of shrinking economic growth (the official definition of a recession). Yikes. Not a pretty scene but read here how you can prepare your portfolio for times like these. 

Recessions and portfolio growth: only one can come out on top. Think of it as a see-saw: when one goes up, the other is going down. When we have recessions, companies’ bottom line (those juicy earnings, or not) gets smaller thanks to falling demand. So share prices will reflect that, if they haven’t already!

I appreciate this is super simplistic but you get the general picture. Basically, recessions aren’t when your portfolio has a lil’ boogie. It’s when your portfolio falls flat on its face. If it hasn’t already. (Read here 3 ways in which you can protect your portfolio during bear markets).

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But recessions don’t just affect portfolios, though. They affect real lives, too. When recessions come about (depending on the severity), job losses are an inevitability. Companies have to stay alive, they’ve gotta conserve cash in this desert and that comes with slimming costs. The more fixed costs a business has (with wages being the biggest of them all) the more they’ll want to cut down.

Mass layoffs aren’t happening en masse. Yet. Don’t get too complacent 

And while we’re not seeing mass layoffs across the board (read here why this makes it the weirdest recession ever) we are definitely seeing it across the tech space. Shopify, which btw was a pandemic winner at one point, has lost 76% of its market cap and is firing 10% of its workforce. Others such as Coinbase, Klarna, Tesla and loads more in the space are also laying off some of their workers.

The other day on LinkedIn I came across a post from a recent grad who had said his offer from Meta was rescinded thanks to harsh times. I can’t imagine the feeling. After having gone through multiple stages just to land an interview and then to receive the good news, only to have your dreams snatched from before you. This is not the first story like this and it won’t be the last. Recessions are all about survival. Companies will do anything they can to survive and that means reversing offers as well as layoffs and hiring freezes. The drought has only just begun. 

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Now you might be thinking, hey, I’m not working (or going into) tech why should I be worried? The short: there’s no telling when the pain will spread. It could be that tech gets a real beating while the rest of us emerge unscathed. But something tells me that ain’t so likely. 

Recessions destroy demand and that’s bad for everyone. So don’t wait around. You’ve gotta be proactive. 

Here are 4 things you can do to make yourself-proof to give yourself the best chance at getting through this so that you can come out stronger, more resilient and hopefully you’ll still be with a job and the end of all this! 

#1 Find your IT factor and let it shine 

When it comes to landing jobs (and staying in them!) likeability isn’t enough. You’ve gotta be unforgettable. Totally irreplaceable. You’ve gotta have that IT factor. It’s something that makes you you and helps contribute to a better working environment. One area you can work on is to show up early. To everything. This allows you to build a rapport with fellow early-birds and get to know your colleagues and be able to talk to more senior people better. Small talk is what will lead to the big talk. Don’t underestimate how important that is. 

My IT factor is that I am chatty. I can literally talk to anyone. I remember during my first internship when I was 16 (gosh that feels like a loooong time ago) I suddenly found myself surrounded by 10 colleagues who were listening to me yap about my high school and whatnot. My time with them came to an end and I received a card which they all signed. They said how they’ll miss my convos. 

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Guys, anyone can do the work. With enough training and skills sessions anything is doable. But being likeable and easy to talk to is underrated. 

Whether you’re a big fat chatterbox like me (have been ever since I was a tot) or whether you’re a reserved individual who makes others feel at ease, heard to and listened to, cultivate it. 

You’ll stand out and people will remember you for that. 

Also, might I add, when you leave your job/internship or any role really, no one will remember what your work was like. They’ll remember what you were like. 

And that sticks. 

#2 Try new things

Embrace change. The future is scary cuz it’s unknown. If we were to know it, there’d be no fear/anxiety! Don’t be afraid to do things differently to try different things and so on. If you fear the company you’re working for is struggling during the recession, get out before you’re pushed out. Start looking for new jobs and be proactive. Prepare for the unexpected.

Job losses, stagnant pay and dwindling opportunities are all casualties of recessions. But remember there is still a tight labour market and there is all to play for.

Someone I know had recently joined a firm and some of his colleagues were getting poached so the company raised everyone’s wages to prevent more poaching! Companies do have cash so go out there and find one!

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If you don’t want to leave your current job, be open to expanding your role. Be proactive and ask to try out new things and get involved in many different projects. Broaden your skillset and make sure you’re super employable.

Being multi-dimensional in your skillset is hugely rewarding. It’ll unlock so many doors for you.

Don’t let a recession, or anything else for that matter, stop you from doing that!

#3 Diversify your income 

Make sure your income doesn’t all come from one place: your employer. When recessions strike, your main source of income is the most at risk. By expanding your income avenues to more than one, you reduce your reliance on your employer. And during recessions, this is massive. Never rely on one person/job to provide all for you.

A great starting place for you to diversify your income streams is by investing into income stocks/funds. Typical sectors include energy. mining and healthcare. Though you’ll find companies in other sectors that also pay out handsomely. You could also have your own make-believe properties by investing into REITs – minus the hassle of looking after tenants which I’ve heard is a little like babysitting! These are also great for inflationary times as rents (which get paid to you as the shareholder in dividends) rise with inflation. So it’s a double win. 

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You could also start freelancing. Whatever skill you have be it baking, banking or boxing – there’s someone else who’s in need of it. Find your clients and get going! Don’t be afraid to put yourself out there.

This is the time to get creative and unleash your talents. While results (and money) won’t always come at once, you’ve gotta have enough grit and perseverance to see it through. You can’t put a price tag on financial freedom and feeling like you don’t need to rely on anyone, except yourself.

#4 Network: your career’s insurance policy 

Networking should be a constant. 

People who think their jobs are safe neglect networking only when they find themselves without a job do they frantically begin the daunting task of talking to strangers. 

But this is all wrong. Think of networking as insurance – you buy insurance before anything bad stuff happens! There’s no point taking insurance out after the fact. 

So treat networking in the same way. Network when you don’t need to so that when you need your network, they’ll be there for you. 

Networking is a relationship; not a transaction. Spend time getting to know the other person. Give, give, give. Only then ask. If you do this, people will remember you and that’s what you want. 

Hopefully this recession will be less-worse than feared but we’ve gotta prepare for the worst and hope for the best. 

You got this! 

Disclaimer: This blog is not investment or financial advice. It is my opinion only. This blog is not a personal recommendation to buy/sell any security, or to adopt any such investment strategy. Always do your own research before you commit to any investment

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