Be Recession-Proof!

According to a survey by CNBC conducted last July, 6 out of 10 Americans believe that a recession will happen next year.

“Recession-proof” is a term used for industries or organizations resistant to the negative impacts of economic downturns. For several reasons, some companies and organizations even grow during a recession, and one way to identify these businesses is by looking for those with negative beta values. This simply means that their assets move in the opposite direction of the economic market. One example is the healthcare industry since consumers always need medical care despite their economic condition.

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One more example is how Amazon grew during the COVID-19 pandemic. At first, Amazon had trouble keeping up with the sudden increase in demand, but as they adapted, they were able to accommodate their consumers by hiring more delivery personnel and scaling their warehouses.

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Table of Contents

What is a recession?
Why does a recession occur?
Signs of a recession
Impacts of a recession
How to become recession-proof?

What is a recession?

One of the most common definitions of recession is two succeeding quarters of GDP decline. According to the National Bureau of Economic Research, recession can be defined as “a significant decline in economic activity spread across the economy, lasting more than a few months.” In some instances, a recession can be measured even before the quarterly GDP report is released by some significant economic benchmark like a decline in income, a drop in employment rates, manufacturing data, and more.

Why does a recession occur?

There are several reasons why a recession happens. Some are correlated with unexpected changes in prices that lead to a sudden decline in expenditure by both private and public sectors.

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Financial market problems can also cause recessions. In the 2008 economic downturn, the abrupt increase in prices and rapid expansion of credit was characterized by debt inflation. As organizations and households move on from overextension and struggle to confront their debt responsibilities, their investments and expenditures decline, and once they do, these recessions become more expensive compared to others.

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A recession can also happen because of a sequence of events in the economy, like a supply chain interruption, a financial crisis, or an international affair. An inflationary phase can also cause a recession. Central banks scale interest rates to steady the economy during inflation, and with these higher interest rates, the possibility of recession also increases.

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Signs of a recession

When gross domestic product reports negative growth, private companies usually hold back with their operation and attempt to limit their vulnerabilities to systematic risks. With the level of spending and investments declining, an expected price reduction might occur to increase demand. GDP declines and unemployment rates rise because companies will try to reduce costs by laying off employees.

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There is a direct relationship between finances and factors like interest rates and supply chain disruptions. The correlation is not straightforward as financial policy contrivance, like interest rate, also involves skirting around replications to banks on slowdowns.

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Impacts of a recession

Rise of unemployment rate - One of the most affected whenever a recession occurs is the labor market. According to Mark Hamrick, Bankrate senior economic analyst, “If we just look at the examples of recessions in recent history in the U.S., they have some things that are in common and some factors that set them apart… What they have in common is that the economy’s downturn puts Americans’ personal finances at some risk and is actually damaging for some.” The main concern for most businesses during a recession is to survive. With a slowing economy, they may relinquish their expansion mindset and instead look for ways to reduce expenses.

Reduce job prospects and decline in job security - Economic downturns also impact those remaining employed individuals. According to AnnElizabeth Konkel, Indeed Hiring Lab economist, “If you’re in a recession and hearing all of this news about layoffs or companies slowing hiring, then you might be a little more hesitant to decide to switch or take that new job… A fear when the news of layoffs circulates is if you take a new job two weeks later, are you going to be the first to get laid off?”

Employees get less bargaining power, meaning smaller raises and less flexibility - Fewer jobs often entail a shift in the power dynamic between employees and employers. Flexible work disposition because of the pandemic might even start to disappear. Economic downturns definitely reduce employees’ advantage to ask for more from their employers, may it be an increase in pay, more free time, and even work location.

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How to become recession-proof?

1. Learn new skills to future-proof your career

Training yourself to learn a new skill or improving the ones you already have, is an excellent strategy to increase your value in your current field and make your resume more pleasant and enticing for future employers. Becoming more proficient with your current expertise will help you stay ready for new advancement in your chosen field.

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The good news is training is within your arm's reach. You can immerse yourself in AppSecEngineer’s courses that are sure to keep you on the bleeding edge of the application security industry.

2. Look for mentors with the proficiency to support you

Having the right people on your side can be a game changer whenever you are facing an obstacle in your career. Why do you think many successful individuals have mentors or coaches? Having a support system, whether it’s career advice or emotional and mental support, makes all the difference.

3. Stay updated on industry trends and innovation

An economic recession is a crucial moment to keep yourself in the know about industry trends and innovation. Being a diligent industry front-runner is important to keep your growth uninterrupted and to have strong job security. Determine the areas in your industry that are struggling and flourishing, and characterize yourself within the overall view.

4. Maintain a positive outlook

While it’s important to know your reality, landing a promotion or getting a pay increase is not that impossible. Even getting hired for your dream position! Companies that are forward-thinking and warrant their teams to develop usually make it through recession stronger than ever. Embrace optimism and embody positivity within your conversation and career outlook. When you are voyaging through rough seas, a positive and shrewd brain is better than a wary and overly cautious employee.

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AppSecEngineer is an established platform that provides training for AppSec skills that employers are actually looking for. In fact, over 90% of AppSecEngineer for Business customers see improvement in their team performance within 3 months. We've got courses in:

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Not only that! We provide real-world inspired Cloud Sandboxes, Challenges, and Playgrounds to put your skills to the test. So whether you’re a security engineer, pentester, or developer, rest assured that we have the right resources for you to effectively upskill and make it through the upcoming recession more valuable than ever.

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