Workloads increase while pay cannot. Expectations grow while headcount is stagnant. And everyone wonders if layoffs are looming. 

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It’s economic hardship and it causes tension in your business. 

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“Do more with less,” they say. 

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Only your team is burning out under the weight of an unfair workload, engagement is faltering, and it's not long before team performance suffers.   

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So what do you do? How do you manage to keep you and your team motivated, happy, and high-performing in the face of economic uncertainty? 

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There’s no definitive answer or blanket solution. Being a manager requires too much adaptability for you to be given a playbook that works every time for every report. 

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But here’s where we would always start:

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1. Acknowledge the situation and get clarity from leadership
2. Tune into Maslow’s ‘Hierarchy of Needs’ 
3. Understand what truly motivates each member of your team
4. Prioritize what matters, automate what you can
5. Break up silos and work collaboratively

First, acknowledge the situation and get clarity from leadership on the outcomes of hard decisions

Acknowledging the situation

There’s no point in sugar coating reality or pretending it isn’t difficult. This can come off dismissive and breed resentment in the team. 

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Instead, take some time to sit with your team (in-person or virtually) and talk through what’s happening.

• What are they feeling? 
• What are they worried about? 
• Is there anything they need from you to make this time easier?

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Let’s say your team is short a team member and the business isn’t going to replace them, yet your targets remain the same. That means as a team, you’ll each pick up additional work and responsibilities. 

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That’s bound to bring up strong emotions in your team.

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Have a frank conversation and let people voice their frustrations. This can prevent negative feelings from building up and becoming toxic over time.

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Once the conversation is had, you can address their concerns and lay out plans for how you and they can prevent burn-out while still working towards your team goals. Find solutions where you can. 

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That way the venting phase turns productive and morale can pick up. 

Getting clarity from Leadership

Transparency and clarity from senior leadership go a long way in building trust and staving off resentment and disengagement.

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When decisions are made—be it layoffs, salary freezes, or shifts in strategy—it's essential to communicate the 'why' behind them. 

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At the very least, leadership should communicate this to you and have you pass it on to the team. At the very best, leadership will have this conversation candidly in an all-hands.

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You want to avoid an ‘us vs. them’ mindset, where employees feel the business is focused on profits over people.

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For example, explaining that a salary freeze was a measure to avoid further layoffs is much better than leaving people with the mindset that they could be next and that the company doesn’t care about their people.

Second, tune into Maslow’s ‘hierarchy of needs’ (and help meet them)

Maslow’s hierarchy of needs establishes every person has five levels of needs. These needs must be met in a specific order—from the bottom of the pyramid to the top.

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When it comes to work, a person’s ability to meet these needs impacts how productive and effective they can be.  Think of it this way, how productive can you be if your health is suffering or you’re going through a family crisis?

In an economic downturn, it’s harder for these needs to be met and thus harder for your team to be their best selves at work.

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What can you do? Know what your team is struggling with at work and at home. This information will guide how you support them. 

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You’ll want to answer things like:

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• Are they working too many hours, too often to get through their tasks? 
• Do they have the necessary tools to perform their tasks efficiently? 
• Are they feeling isolated or disconnected from the team?
• Do they need a little grace while they sort a personal problem?

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Your role is to bridge these gaps where you can. Ensure they have a conducive environment for work, provide the resources they need, and foster a sense of belonging. 

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By offering support and responding with emotional intelligence to sensitive situations, you’re building psychological safety and resilience in your team.

Third, understand what motivates your team individually and collectively (other than money)

Your team’s responsibilities have increased and yet you have no way to monetarily compensate them. That’s tough. Especially when a salary increase could relieve financial stress your team is feeling.

That doesn’t mean you can’t motivate them to perform. You just need to find what makes your team, as individuals and as a collective, tick. 

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Some find motivation in personal development, constantly seeking opportunities to learn and grow. For others, it's the simple act of being recognized and praised for their efforts. 

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And then there are those who are driven by a sense of purpose, wanting to feel that their work contributes to a larger mission.

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Once you know what drives them, you can use it to keep them engaged with their work until monetary compensation and promotions are realistic.

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Want to know how to motivate your team? Check out our article: How to Motivate Your Team (in Good Times and Bad)

Fourth, prioritize ruthlessly and automate what you can

Prioritizing what matters

In a start-up, everything feels urgent. But not everything that demands your attention deserves it. 

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You’re leading the team so it's up to you to decide what’s worthwhile and to find ways to alleviate the pressure while getting the best results possible. 

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Saying 'yes' to every request from leadership isn't a sign of efficiency; it's a fast track to burnout—for you and your team. 

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Your role requires a delicate balance of understanding the broader company strategy, aligning it with your team's OKRs, and then determining the best course of action. 

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Sometimes, this might mean pushing back or suggesting a more impactful alternative. Your team looks to you for direction, and by focusing on what truly matters, you shield them from unnecessary stress and ensure their efforts are channeled effectively.

Automating where you can

If your team is stretched beyond capacity, the best thing you can do is find ways to lighten their workload. When hiring is off the table, think of ways AI can step in. 

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Maybe you can automate your reporting system, routine tasks, or use ChatGPT to expedite a portion of work. The specifics will depend on your department and needs.

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Effective management in challenging times is about making smart choices—knowing what to focus on, when to pivot, and how to leverage available resources to achieve the best outcomes.

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That way your people can give their all while still leaving gas in the tank to do it all again tomorrow. 

Fifth, break silos and collaborate more

Ever feel like you’re carrying the burden alone? It’s tiresome and demotivating. 

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You don’t want any member of your team to feel that way. In fact, a sense of togetherness, of 'we're in this together', can be the catalyst that drives performance and engagement.

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A study conducted by Stanford psychological scientists Priyanka B. Carr and Gregory M. Walton revealed that the mere feeling of being part of a team can amplify motivation for challenging tasks. 

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Participants who felt they were working in tandem with peers worked 48% longer on a task than those who believed they were working solo. This group also found the task more intrinsically rewarding and fun.

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If you’re remote, you’ll need to take extra effort to make sure your team doesn’t work too much in silos. Find projects where their collective skills require them to collaborate and work toward shared goals. 

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It could get you all through the worst of it.

Above all, be at your best so they can be at theirs

Your team's performance and engagement is a reflection of yours. 

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When you’re present and ready for 1-1s, responsive to team needs, on top of feedback, and leading by example, you’re more likely to see high-engagement and high-performance in your team.

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Of course, in an economic downturn you’re equally at risk of burn-out and disengagement. So it’s important to find ways to get support in your own performance.

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Where can this support come from? Management tools like Waggle are a great place to start. 

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With Waggle, you can:

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• Set up and maintain team rituals: Ensure that essential meetings like one on one’s, team huddles, and career conversations take place consistently.
• Stay on top of priorities: Waggle's manager dashboard helps you prepare for meetings and follow through on action items, ensuring nothing slips through the cracks.
• Translate intentions into actions: With just-in-time signals on best practices, Waggle ensures you're always on point, especially during crucial meetings and difficult conversations.
• Have impactful meetings: Waggle's timely nudges and task automation ensure your meetings are productive, allowing you to be genuinely present for your team.
• Receive real-time insights: With AI-driven feedback, adapt your management style on-the-fly, ensuring you're equipped for any scenario.

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→ Grab early access to the Waggle platform and lead your team through good times and bad. ←

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Are you a manager of managers looking for advice on how to help them lead? Forward them this article and make sure you read our guide: Your Guide to Managing Managers: 7 Tips to Help Them Lead