Facing The Fear Of Recession

Facing The Fear Of Recession

Nothing in life is to be feared, it is only to be understood. Now is the time to understand more, so that we may fear less.” ― Marie Curie

I have been to the gas stations. I have been to the grocery stores. In my profession, I have ordered parts and equipment, and I have negotiated (or renegotiated) salaries with employees. Yep. We are anticipating some scary trends in the domestic and global economy. Following the steady uptick in inflation, now we are hearing the usual apocalyptic forewarning of “recession.” Since I cannot predict the future, darn it, my methodology is to begin at the beginning and build a strategy. My way of facing the fear of recession is to understand it at the most basic level.

Folks—We Have Already Been Through 4 Recessions—We Forget So Quickly

First, let me state a well-known fact: recessions are considered an unavoidable turn in a business cycle. It is predictable in any expansion and contraction of a nation’s economy. Wall Street investors will be the first to acknowledge that “what goes up must come down.” Ok, okay. Then we do not have to reinvent the wheel when it comes to dealing with this economic “contraction.” We saw the Federal Reserve raise interest rates by a quarter of a point last week to help slow down the flow of money being borrowed. But a recession can last for an extended period, months or years. The average length of a recession in the U.S. is 11 months. It is characterized by falling gross domestic production (GDP), lessening manufacturing, falling sales in retail and income, and rising levels of unemployment. These markers are much broader and more inclusive than just, say, the stock market dropping into bear territory. I think it is safe to assert that most of the small to mid-sized businesses (SMB) in our region are seasoned veterans of recessions. Just in the last 30 years, the U.S. has gone through four recessions.

History From The National Bureau Of Economic Research

The NBER is the authority that defines the beginning and ending dates of U.S. recessions. The NBER defines a recession as “a significant decline in economic activity spread across the economy, lasting more than a few months, normally visible in real GDP, real income, employment, industrial production, and wholesale-retail sales.” The four recessions I have lived through with my business are:

  The Covid 19 Recession (mid-February through mid-April, 2020, the shortest one ever)

  The Great Recession (December 2007 until June 2009) This 18-month recession began when the real estate market bubble blew up. The average recession lasts 11 months.

  The Dot Com Recession (March 2001 – November 2001) There was a tech bubble crash, the Enron scandal, and the 9/11 terrorist attack. But the U.S. bounced back quickly from all of this.

  The Gulf War Recession (July 1990 – March 1991) Somewhat caused by inflated oil prices caused by the First Gulf War.

Been There. Done That. We Are Still Standing

All of the doomsday fanfare about a possible recession should be duly noted, but it should not cause a panic. I would rather deal with an economic challenge that I have been through before than, say, deal with losing 19 children and 2 teachers in a school shooting. I can go back to my financial records of the above-mentioned previous recessions. I can find my notes about previous strategies. I can talk to industry peers about common problems and possibly cooperative solutions. I prefer to make lists of things that I can do rather than brood about what I might not be able to do.

Now would be a great time for you to take advantage of Aptica’s free assessment. Learn what you have with your current technology. Discuss what you might need to stay at maximum productivity. Don’t presume you are “fine.” Ask a professional IT management company who will assess with no obligation. It can start with a phone conversation. 260.243.5100. Owned by a former Eagle Scout who believes in being prepared.

Jason Newburg, 260.243.5100, ext 2101, is the founder and owner of Aptica LLC. This IT management and support company has been serving small to medium-sized businesses for 20+ years in the region that includes Angola, South Bend, and Fort Wayne, IN, Battle Creek, MI, and Toledo OH.

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