How can Canadian employers get ready for HR uncertainties resulting from tariffs?

Employee Salaries in 2024 — TAP - Economic uncertainty and human resources

The recent changes between Canada and the United States may have businesses worried about their future and job security for their employees. Economic uncertainty can present unique challenges for businesses, particularly when it comes to your employees and your HR practices.

Having the ability to minimize workforce disruptions, support employee morale and implement strategic planning will be key to building much-needed business stability. Understanding how to deal with uncertainty and by focusing on proactive solutions, businesses can create a more resilient workforce that continues to focus on and support your organizational goals.

Understanding the Impact of US-Canada Relations on Businesses

Now more than ever, businesses are seeing the effects of global instability, including the US-Canada trade tensions. The increased tariffs and trade restrictions have created supply chain disruptions which is leading to material shortages and rising costs. Canada-based businesses are also feeling the strain of the weaker Canadian dollar, affecting their ability to remain profitable. With rising costs and higher operational expenses, businesses may face a hiring freeze or potential workforce reductions.

With these challenges in mind, business owners, office managers, and HR leaders will need to adopt strategic approaches to ensure workforce stability while maintaining productivity. This means businesses will need to re-evaluate workforce structures, plan for potential disruptions, and ensure that employees feel supported during these uncertain times.

Navigating Strategic Workforce Planning in Uncertain Times

It is important for businesses to remain proactive in adapting to changing economic conditions, and having contingency planning will be key to their continued success.

Businesses that are facing a potential workforce reduction could consider implementing job-sharing or part-time options so that they may retain their employees and manage rising costs. This is a great way to retain employees for when the economy possibly changes.

Additionally, businesses may look at hiring new employees on term agreements or contract-based roles. This will address short-term staffing needs while maintaining flexibility until the economic uncertainty becomes clearer, while also allowing businesses to scale as needed without long-term financial commitments. Businesses may also consider investing in upskilling or reskilling their employees. Investing in professional development will allow employees to be adaptable to the changing business needs.

Those carrying the torch for HR should continue to work closely with leadership to develop or update contingency workforce plans that will focus on employee retention while supporting financial stability.

Maintaining Employee Morale

Often, we will see a decline in employee engagement and morale during economic uncertainty, but there are steps that a business can take to continue to foster a supportive and open workplace.

Businesses should continue to have regular and transparent communications with their employees, this can include holding consistent check-in meetings with teams and sending out company-wide updates so that employees can stay informed of the most recent changes. Businesses should also continue to foster a supportive workplace environment by encouraging open-door policies and offering more leadership accessibility. Employees feel more supported when they are recognized for their work, and as such, businesses could consider implementing small incentives to boost motivation.

By creating an environment where employees feel valued and informed, businesses can take additional steps to support mental well-being. By encouraging work-life balance through flexible schedules, promoting mindfulness activities such as meditation sessions, or offering resilience training, businesses can help employees manage stress during uncertain times.

Access to Employee Assistance Programs (EAPs) or mental wellness resources reassures employees that they have the support they need during challenging times. By prioritizing both transparency and mental well-being, businesses can maintain productivity and employee morale despite the current economic uncertainty.

Strategic Planning for Long-Term Resilience

While it is a best-practice for business owners and leaders to stay attuned to what is happening in politics and the economy and adjust their plan accordingly to meet the immediate needs of the business and its people, it will be critical that business owners and leaders do not impulsively react to the constantly changing policies on both sides of the boarder.

Businesses will need to remain adaptable and innovative to ensure their future. They should also build a resilience to challenging economic times through strategic planning. Having strategies to deal with the concept of uncertainty and with a variety of possible business impacts and outcomes will help to ensure a careful approach to the future.

Businesses should embrace agile workforce planning by staying responsive to economic changes, this may mean adapting to more flexible staffing models, leveraging technology by using digital tools that allow for more collaboration and improve efficiency, and empowering employees to contribute innovative ideas that will drive growth.

Conclusion

By prioritizing transparent communication, strategic workforce planning, and employee well-being, a business will be better positioned to navigate economic uncertainty. By fostering a resilient and adaptable workplace culture, business owners and leaders can help organizations remain stable, engaged, and prepared for the future.

If you feel that you could benefit from additional advice, guidance, or support or help setting up these strategies, reach-out. We are here to listen and connect you with a professional to help guide you through many of your business and employee challenges with sound, practical, advice. Give us a call at 613-222-2499.

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Kalida Griffiths is a Human Resource Specialist at TAP Strategy & HR Consulting, a boutique-style management consulting firm specializing in strategy, HR services and Helping Businesses Succeed.