According to leading economists, UK unemployment could rise to 10% or equivalent of 3.5 million people
Laying people off at a time when the job market is in freefall provides unprecedented challenges for companies, the communities they serve and their departing employees. These challenges if not addressed can have significant consequences for the brand and reputation of the organisation, not just with former employees but current and future.
As companies look to tackle these challenges, many are defaulting to the traditional outplacement services of career counselling, personal brand development and resume building and whilst these have a role, this new world paradigm requires alternative pathways that moves away from job hunting to job creation by helping employees become founders.
Helping your employees build a startup in a downturn may feel counterintuitive but data, and history, shows that in times of rapid disruption there are ample opportunities for new startups to take advantage.
In fact IBM, HP, FedEx and Microsoft were all started during recessions. Consumer needs and behaviours radically change when there’s a shift in the economy, opening up market opportunities that did not previously exist.
The process is tried and tested. Nokia was faced with making over 40,000 job cuts, so alongside it’s traditional career exit provision, it created ‘The Bridge,’ an entrepreneurial stream for employees that had an idea for a startup.
The programme enabled ex staff to pitch for seed capital of €25,000, with up to four ex-employees being able to band together in order to access a potential pool of €100,000.
It also offered training on relevant skills, access to tools and guidance for successful growth, alongside exposure to angel investors, venture capitalists and others.
Since its inception, The Bridge has helped over 300 start-ups get their beginning. The scheme is credited for fuelling the rise of the Finnish tech ecosystem, which includes success stories like Supercell and Rovio.
How can HR leaders create these new pathways?
HR needs to create a forum for ‘talent’ that brings departing employees from different disciplines such as engineering, marketing and sales together to share ideas. There should also be additional support, from potentially offering seed funding through to giving access to unused IP, assets or data to help spark potential ideas for them to build on.
To capitalise on the positive impact and use this to actually grow brand equity, there needs to be a planned and sustained comms campaign inside and outside the organisation. This means you will find the right partner to deliver the best experience and approach for your people to maximise success.
As with any downturn, there will be a new generation of high growth startups. Yet unlike before, there is a window for businesses to live their values around their people by proactively helping their talent create their future, while also helping stimulate the economy in the communities they are integral in.
Those companies who use this crisis to live their values and empower their people to build their future is something that won’t just resonate with those departing, it can also play a critical role in talent attraction and retention for the future.
Chris Locke is CEO UK and Europe at rainmaking and head of startup bootcamp Rise