Recession 101: What Business Leaders Need to Know about Economic Downturns

Business leaders are worried about recession. Their responsibility, however, is not just to survive a downturn, but to capitalize on good times before the recession comes. I’ve held several workshops for company executives and owners in which we explore

  • steps that can be taken ahead of time to make a company more resilient
  • key elements of recession contingency plans
  • how some companies use recessions to seize greater market share.

Before these discussions, though, I lay the groundwork with “Recession 101.”

Graph of risk of recession 2016-2019
Risk of recession from survey by The Wall Street Journal

The key features of recessions are important, but company decisionmakers don’t need to get deep in the weeds. I have written several articles for explaining what business leaders need to know in order to lead their organizations away from risk and toward greater profitability in good times and bad.

Business Cycles: How Frequent, How Severe?

The economy has become calmer in recent decades. This article explains why and looks at the future volatility of the economy.

Will the next recession be any different?

Explores commonalities of recessions, and what might be different in the next recession.

Leading Economic Indicators Are Misleading

Explains indicators that might predict a recession and why we cannot fully trust them.

Causes of America’s Post-World War II Recessions

Titled “No, We Don’t Talk Ourselves Into Recessions,” this article gives a one-paragraph summary of all recessions starting with 1948-49.

Stock and Commodity Prices Don’t Forecast Recession

After stock and commodity prices collapsed in 2016, doom and gloom spread widely. This article explained why the price drops did not foretell recession.

Forecasting Sales in These Uncertain Times

Cash flow projections are vital to surviving a recession, but they are hardest to make during recessions–highly uncertain times. This article gives a framework for working up your own company’s cash flow projections.

Cutting Costs to Survive a Recession: How Far Should a Business Go?

Nobody likes to cut expenses or lay off employees, but sometimes survival of the company demands it. Here’s a guide to thinking through the process.

Economy May Be Out Of Recession But Not Out Of The Hole

Economists define recession as the period when the economy is declining, excluding the period when things have started to improve, but not yet regained all lost ground. Keep that in mind when news comes out about recession.

Inventories Should Be Larger This Recession–Not the Usual Advice

Businesses should usually cut inventories in a recession, but the pandemic downturn includes many supply chain failures. Sometimes the usual advice is not right for a particular business cycle.

Grow Your Business in the Next Recession

Some companies emerge from recession stronger than ever. Here are opportunities to look for during a recession.

7 Growth Strategies for the Coronavirus Recession

Explores growth strategies specific the the Covid-19 pandemic.