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Nora Jenkins Townson is the founder of Bright + Early, a modern HR and workplace design consultancy.

Business leaders in 2022 may be experiencing a bit of whiplash. The extremely tight labour market of 2021 and early 2022 led to hiring difficulties and rapidly climbing salaries, and the current financial climate has left organizations struggling. Businesses see a potential recession on the horizon and are looking at reducing budgets and staff, but they must still focus on retaining good employees, now with smaller budgets for pay increases and flashy perks. The good news? Money isn’t everything. Here’s how to stay close to your team in tough times and ensure they feel appreciated, motivated and engaged.

Acknowledge reality

If there is less in the budget for the usual perks and benefits, be honest. Many leaders hold off talking about cost-cutting measures for fear it will scare employees or give the impression the company is unstable. On the contrary, the right messaging can get your team on board as part of the solution. Plus, they are bound to notice any changes and come to their own conclusions if you aren’t up front. Discuss any budget cuts, presenting them as an opportunity to rally behind the company’s mission and vision. As a team, you can win and get through tough times together. They may even have some great ideas of their own to contribute.

Stay competitive

Even if there’s no money for extras right now, don’t put your head in the sand. Continue researching competitive salaries and benefits in your field. Knowing what your team is worth on the open market will help you get a sense of what you’re up against to keep them engaged. Ensure you aren’t too far off; no great sense of mission or amazing perk can make up for someone’s basic needs not being met. Make sure any sacrifices apply to leadership as well; this isn’t the time to hand out executive raises or bonuses.

Get creative

Depending on your situation, there are a number of perks and benefits that have low or soft, time-based costs. Why not experiment with a four-day workweek, flexible hours, working from home (if you aren’t already) or time off to volunteer or innovate? If you’re working in the office, you could look into allowing pets at work, setting up a games room or library or bringing in inspiring guest speakers.

Invest time in people

There’s an old adage that people don’t leave companies, they leave managers. It’s true. During difficult times, feeling seen, understood and supported by a manager is more important than ever. Keep those connections strong by ensuring regular one-on-ones, skip levels (occasional check-ins with their manager’s manager) and feedback sessions are happening. Each manager should have a strong sense of each person’s goals and should be finding opportunities to help them achieve them. Being given a special project, more responsibility (if desired and appropriately compensated) or a new project tailored to one’s interests is a great way to keep things fresh and engaging.

Stay connected

While flashy parties and retreats may not be an option right now, social connection doesn’t have to have a price. Make sure to put time aside for people to connect and bond either in person or virtually. Something simple like virtual trivia, a park picnic or patio drinks can lift the vibe for weeks. You can even rotate planning duties, letting different teams or people have fun creating an experience for others. If you have a casual environment, you can create ongoing connections by creating employee-led interest groups (yoga or book clubs, even a company band) or lunch-and-learn workshops about personal skills and interests, like photography.

Stay positive (and appreciative)

There’s a reason each team member said “yes” to your organization in the first place. Keep that spark alive by staying positive about the future and reminding your team about the impact their work has. Share wins and keep things focused on your mission and values. Be sure to call out great work both publicly and privately and share genuine appreciation for your team. You can even get your team involved by starting a formal recognition program or something as simple as asking them to nominate or write a card for someone who made a difference for them. Times may be tough, but ensuring employees feel valued can make the difference between feeling ready to pitch in or ready to move on.

Come through when things clear up

For employees, there’s nothing worse than making an extra effort during a downturn and feeling like that work isn’t appreciated or rewarded. Once you’re out of a tough period, don’t delay in handing out any overdue raises and bonuses or bringing back popular (but more expensive) perks that were shelved. Once things settle down, rewarding a loyal team should be your very first priority.

This column is part of Globe Careers’ Leadership Lab series, where executives and experts share their views and advice about the world of work. Find all Leadership Lab stories at tgam.ca/leadershiplab and guidelines for how to contribute to the column here.

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