Economic instability doesn’t just impact markets, it shakes the confidence of your workforce. When employees sense turbulence, they often jump to conclusions, misinterpret signals, and become vulnerable to competitor offers. In one recent example, a high-performing employee left a privately held company after assuming the pipeline was drying up, despite no meaningful slowdown. The business owner was blindsided.
Why does this happen?
- Employees often connect the dots incorrectly when communication is lacking
- Rumors spread faster in uncertain environment
- Competitors can appear more attractive when internal trust erodes
These dynamics can lead to damaging assumptions: layoffs, pay cuts, bonus cancellations, or consolidations. Left unchecked, they erode morale and retention.
Here are five ways business leaders can take an active role in counteracting uncertainty by being proactive and transparent.
1. Increase the Frequency of Transparent Communication
- Hold regular town halls or team huddles. These can be at the corporate level or on the front lines with well-informed managers.
- Share what’s known and what’s still evolving. Both elements are important. Many leaders fear sharing information that is still evolving because “what if it changes?” The reality is, it probably will change, but your people will trust and believe you more if the ground doesn’t feel like it is shifting without context.
- Reinforce company stability and direction. Having a strategic plan is a critical element. When you manage crisis to crisis, month to month, with consistently changing (different than evolving!) priorities, the team loses focus and confidence.
2. Admit What You Don’t Know
- Acknowledging uncertainty builds credibility. The importance of presenting yourself as a human in times of uncertainty is critical. Projecting a false sense of security can make you look out-of-touch and can leave your team feeling gaslit.
- Employees appreciate honesty over vague reassurances. Saying “everything will be fine” may be well-intended. But when the world around your team doesn’t feel “fine,” telling them it is or will be does little to lessen their unease.
3. Create Anonymous Feedback Channels
- Use digital suggestion boxes or third-party tools. In a perfect world, your team will communicate how they’re feeling. Unfortunately, especially when times are uncertain, people tend to internalize their concerns. Even the team members you have the best relationship with may become reluctant to share. Help combat this tendency by giving your employees an outlet to share what’s on their minds anonymously. You may be surprised by what you learn.
- Encourage candid input without fear of retaliation. If this feels like a far reach, I highly recommend reading Amy Edmondson’s book, The Fearless Organization. She is the ultimate authority on psychological safety in the workforce.
4. Use Pulse Surveys to Gauge Sentiment
- Use short, frequent surveys to help track morale and concerns. It’s important to understand your team’s sentiments in a proactive manner. Don’t wait for them to come to you.
- Act on trends quickly to show responsiveness. Using pulse surveys in a timely fashion will help you to stay focused on who and what to prioritize.
5. Conduct Stay Interviews with Top Talent
- Ask what keeps your high performers engaged and what might drive them away. Just because you don’t ask the question doesn’t mean the answer doesn’t exist. Asking these questions will keep you in the power position, even if the answers surprise or upset you. Information is power.
- Use insights to tailor retention strategies. Oftentimes we think about retention strategies when we’re in a crisis mode: massive or unexpected turnover, a new competitor in the market, or a shift in economic expectations. Taking a proactive approach through stay interviews will help you stay ahead of the crisis.
These tactics matter now more than ever. In uncertain times, silence is not neutral, it’s dangerous. If you leave the dots open, employees will connect them wrong. They’ll imagine layoffs, pay cuts, or worse. And once rumors take hold, they’re hard to reverse.
Navigate Uncertainty with Kreischer Miller’s Talent Advisory Practice
If you're navigating economic uncertainty and want to retain your best people, consider partnering with Kreischer Miller’s Talent Advisory practice. Our team specializes in helping privately held and family-owned businesses strengthen employee engagement and retention, especially when it matters most.
Let’s talk about how we can support your leadership team in building trust, clarity, and resilience.