The second half of the year 2000 and the first half of 2001 have seen
indications of an economic slowdown. In fact, some danger signs are beginning
to appear on the horizon. Perhaps the most fundamental problem is the
fact that the income people have to spend or save (personal disposable income)
has increased at an annual rate of only 3 percent over the past four quarters,
compared to an average of almost 10 percent over the past four years. To
purchase new cars, furniture, and household equipment, consumers have
built-up record levels of debt, which may slow additional purchases in the future.

The summer’s tax cut and low interest rates may restore the economy’s growth.
However, indicators over the past four quarters put the increase in goods and
services (Gross Domestic Product) well under 2 percent, productivity up an
average of 1.3 percent, investment down an average of 6.6 percent, and the
purchase of durable goods up just 5.7 percent, well below the 9.8 percent average
increase of the past four years. First quarter data revealed profits down over 8
percent. For the first time since 1991, plants are operating below 80 percent of
capacity. At the same time, the Federal Reserve’s most recent survey of nationwide
economic conditions found many signs of slowing growth.

As employers sense the possibility of an oncoming Recession, redundant staffs are
downsized and hiring is reduced and becomes more selective. Expansion plans are
put on hold. With profits threatened and surplus workers seeking employment, starting
salaries and scheduled pay increases may be minimized.

If a downturn develops, use these strategies to make the most of a bad situation:

1. If you are about to graduate, and the demand for your occupation has fallen-off,
   consider staying in school and earning an advanced degree, instead of waiting to go
   back to school after you have a few years experience. You can maximize use of
   your time by getting additional skills now that will earn you more senior positions
   and more dollars when the economy recovers.
2. If you must find employment now, target your job search at industries that are
   continuing to do well. (See companion article.)
3. Lower your expectations. Rather than expecting your dream job, just try to get
   your foot in the door. Once you’re hired and the economy improves, you should
   be able to move to the desired position.
4. Be flexible. If you are already employed but it looks as though you may be laid off,
   try to find a more secure position with your current employer, even if it means
   interrupting your planned career path. Better to stay with an employer who knows
   you than take a chance with someone new in poor economic times.
5. Stay optimistic. During hard times employers admire those who try to make the
   best of difficult circumstances. When times improve, the respect you have earned
   may actually accelerate your career advancement.