Are You Ready for the Next Recession?

I know this seems like a silly question to ask, as the stock market continues to set new records and the unemployment rate is the lowest it has been in more than 10 years. However, speaking as a former economist, I know that this is precisely the time to ask the question because good times never last forever and the next downturn is likely to come without warning. Economists have a poor track record of accurately predicting recessions, so by the time a consensus believes that a recession is coming, we will probably already be in one. What we do know though, is that we are well into the current expansion and soon we will be living on borrowed time. The last recession ended in June 2009, so we are no 8 plus years into the current expansion. The longest expansion in modern economic history was the 9 year run from 1991 to 2000. The next longest was 8 years from 1982 to 1990. So, in another we will hopefully be in record territory for the longest economic expansion in our history.

This means that a recession is due sooner rather than later. Are you ready for it? Have you done all that you can to demonstrate your value by carefully aligning your discretionary programs to the CEOs most important goals and then showing the impact of learning on those key goals? Do you have strong relationships with the goal owners and senior leaders so they will speak up on your behalf? Are you running your basic skills and compliance training as efficiently and effectively as possible and do you demonstrate that to your senior leaders? Are you setting specific, measurable goals and plans for key measures and then use monthly reports to compare year-to-date progress against this plan? Do your senior leaders see these reports and know you are running learning like a business?

If you‘re not doing these kinds of things now, why should your CEO continue your current level of funding and staffing when the next recession comes. Competition for funds and staff will be fierce, and every department may well see a reduction, but historically, L&D takes a disproportionately large hit which reflects the CEO’s lack of confidence in or understanding of the value L&D provides. So no is the time to put the business processes in place to demonstrate alignment, value and rigor so that your senior leaders will have a better appreciation for the value added by learning and they will have greater confidence in you as a learning leader. You cannot prevent the next recession, but you can position your department to weather the storm.

Now is the time to prepare.

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