In today’s unpredictable economy, the instinct to downsize your team may seem like the quickest and easiest way to cut costs. However, as economic uncertainty looms and costs continue to rise, it’s essential to pause and consider alternatives that can protect both your business and your people.
Downsizing your team may provide temporary relief, but it often comes at a significant cost. Instead of resorting to drastic measures, now is the time to explore strategies that allow you to maintain your workforce while navigating the storm ahead!
In this blog, we share 5 alternatives to downsizing your team that you can consider to avoid losing your top talent.
1. Invest in Upskilling & Reskilling Your Team
Instead of cutting jobs, think about how you can invest in your most valuable asset: your employees. Upskilling and reskilling programs provide opportunities for your team to acquire new technologies, skills, and roles that will drive your business forward.
Upskilling involves enhancing the existing skills of your workforce, enabling them to perform at a higher level in their current roles or adapt to new tools, technologies, or methods. Reskilling, on the other hand, focuses on training employees for entirely new roles or career paths within the company, often in response to changing business needs.
Not only will this elevate your team’s value, but it will also help you retain the people who already understand your company culture and contribute to your success! In times of disruption and uncertainty, whether due to shifting markets, tariffs, or supply chain issues — upskilling and reskilling ensure your team can stay competitive and adapt to change.
What you can do:
- Create training programs: Help employees stay ahead of industry trends with accessible learning resources.
- Offer career development paths: Build clear pathways for growth that encourage long-term retention.
- Equip employees with relevant skills: Involve your team in training initiatives that are directly linked to the current needs and challenges facing the business.
2. Consider Flexible Work Options
The traditional 9-5 workday isn’t always the most efficient model, especially as economic conditions fluctuate. Flexible work options; whether a 4-day workweek, remote opportunities, or staggered shifts — can help your business maintain productivity while reducing operational costs.
Not only does flexibility support employees in balancing work and life, but it also helps you lower overhead costs like office space and utilities. During times of uncertainty, offering flexible work arrangements can be a win-win for both your team and your bottom line.
What you can do:
- Implement remote work options: Allow employees to work from home, saving costs on office space and giving them more autonomy.
- Introduce staggered shifts: Reduce office congestion and lower utility expenses by offering varied working hours.
- Encourage a results-driven culture: Focus on outcomes and performance, not the hours spent in the office.
3. Harness Innovation & Internal Efficiency
Now is the perfect time to rethink your internal processes. Where can you innovate, automate, or streamline? Economic uncertainty provides an opportunity to take a closer look at how you operate and how you can make meaningful improvements that drive efficiency.
By involving your employees in workshops to uncover cost-saving solutions, you not only foster a culture of innovation but also tap into valuable insights that can help the business thrive. Get creative in restructuring or repurposing resources, protecting your people while ensuring the company remains agile and sustainable!
What you can do:
- Evaluate processes for inefficiencies: Look for areas where automation or technology can help reduce manual work.
- Encourage collaboration: Empower your employees to come together and brainstorm new ways to reduce costs or improve workflows.
- Repurpose existing resources: Make the most of what you already must avoid unnecessary expenses.
4. Temporary Layoffs
In certain situations, when business conditions change unexpectedly, a temporary layoff might be a practical option to avoid permanent job losses while still maintaining the possibility of re-engagement when business picks up again.
A temporary layoff occurs when employees are asked to stop working for a set period but are not permanently terminated. During this period, the employer’s responsibility is to follow specific federal or provincial employment standards, including adhering to notice periods or compensation based on the length of the layoff.
In Canada, a temporary layoff is typically allowable for up to 13 weeks within a 20-week period without triggering termination requirements under federal labor standards.
However, if the layoff extends beyond the allowed period, it may be considered a constructive dismissal, which can lead to severance or other legal obligations. It’s crucial to clearly communicate the terms of the layoff to employees, including the expected duration and any benefits or support they will receive during this period.
While this can help businesses navigate temporary slowdowns or disruptions, it’s important to remain mindful of both legal obligations and the potential impact on employee morale. Temporary layoffs, when used appropriately, can be a strategy that allows companies to weather uncertain times while holding onto their most valuable talent.
5. Work-Sharing
In response to growing concerns over US tariff threats, the Canadian government has expanded its Work-Sharing Program, a key initiative aimed at preventing layoffs during periods of economic downturn. As of March 7, 2025, businesses facing significant reductions in activity due to US tariff impacts are eligible for new measures designed to ease financial strain.
The Work-Sharing Program allows businesses to reduce employee work hours while ensuring financial support through Employment Insurance (EI) benefits. This initiative helps companies retain skilled workers even during uncertain times. The updated measures include an extended eligibility period for businesses, including non-profits and seasonal employers, and the extension of work-sharing agreements from 38 to 76 weeks.
These changes are particularly relevant for industries facing cyclical downturns or direct tariff impacts, offering a vital tool for maintaining workforce stability and business continuity. (Read more here.)
Protect Your People and Your Business
If your company is going through a tough patch, the best tip we can offer is to care for your employees. At the end of the day, they will always remember how they were treated.
Facing economic uncertainty is daunting, but you don’t have to navigate it alone. If you’re an employer that needs support, doesn’t know what to do next, or just needs an ear, we’re here for you.
No strings attached, no subtle sales pitch, no expectations.