Singapore – Companies are susceptible of losing their top talent during the upcoming recession, says the managing director of J. Robert Scott.

According to Rohit Ambekar, managing director of J. Robert Scott, economic recessions tend to reveal two types of psychologies in employees.

The first set of employees will fear the career uncertainties and will remain close with employers. The other group of employees will seize on the downward cycle and use it as an opportunity to venture elsewhere. Ambekar says that during a recession, the latter group of employees will think: “If I get into something else, the only way I can go is up.”

Hence, Ambekar advises companies to look out for employees that belong to the latter group, as their entrepreneurial mindset would be a good characteristic for leadership positions.

While the economic recession is an opportune time for companies to invest in a sophisticated level of training and development to retain talent, some companies are still entrenched with hiring and firing talent according to the business cycles.

“If you look at the economic cycle, the biggest priorities during an economic boom tend to be purely about growth. And in an economic downsizing, it tends to be about cost reduction,” he adds.

Traditionally during an economic boom, a company will focus its money towards marketing and bringing in new talent. Likewise, companies will reduce expenditure on its cost centres by freezing new hires and halting the renegotiation of contracts with external HR recruiters during the slowdown.

By identifying core talent and investing in them through training and mentoring, progressive companies would be able to avoid the “hiring and firing” cycle.

“But I do think that training and development in the progressive companies is gaining far more priority. That is a more sophisticated strategy of finding the good people and retaining them by making them better, rather than going through the cycle of hiring and firing,” he adds.