It’s no secret that the economy is in a recession. And while that means tough times for many businesses, it also opens up opportunities for others. In fact, there are some businesses that actually thrive during a recession.
So if you’re looking to start a business, or switch to a new line of work, now might be a perfect time. Read on for some of the best types of businesses to work for in a recession.
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When the economy falls off a cliff, as it did in 2008, it results in a recession. The term “recession” refers to an economic downturn that lasts for a brief time.
When consumers don’t spend as much, and many individuals are unemployed, it’s an indication of a recession.
During a recession, firms frequently have to make reductions in staff, and industrial production is typically down. Sometimes, there is also a housing crisis, just like there was in 2008, where people have to foreclose on their homes.
According to economists, recessions are unavoidable because it is part of the business cycle, and things typically get better in about 16 to 18 months.
So what types of businesses actually do well during a recession? Here are some examples.
Grocery stores are one of the few businesses that actually do better in a recession. That’s because people still need to eat, no matter how bad the economy is.
Health care is another industry that does well in a recession. That’s because people will always need medical care, no matter how bad the economy is.
Interestingly enough, candy and dessert sales actually go up during a recession. That’s because people are looking for ways to cheer themselves up during tough times. And what better way to do that than with a sweet treat?
Alcohol sales also go up during a recession. That’s because people are looking for ways to relax and escape the stress of tough times. Drinking alcohol at home is also a lot cheaper than going out to a bar or club.
**Note: I don’t recommend using alcohol as an escape! Find other healthier ways to deal with stress, such as exercise and meditation.
Discount stores do well in a recession because people are looking for ways to save money. That’s why stores like Walmart and Target actually saw their sales increase during the last recession.
Dollar stores and thrift stores also do really well during a recession for the same reasons.
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Even during a recession, parents still need to buy their children toys and clothes. In fact, many parents actually start buying more children’s products during a recession because they’re trying to save money on entertainment.
The pet industry actually does quite well during a recession. That’s because people see their pets as family members, and they’re not willing to skimp on their care, even when money is tight.
This one may seem counterintuitive, but hear us out. People actually start hiring financial advisors during a recession. That’s because they want help navigating the turbulent economy and making the most of their money.
**Note: In general, I don’t think most people need to use a financial advisor. The fees typically don’t support the kind of returns you get with an advisor. Most people can just keep it simple and invest money in a Vanguard index fund like VTSAX.
With more and more people working from home, cybersecurity is more important than ever. Businesses are typically willing to spend money on cybersecurity during a recession.
During a recession, people are more likely to repair their existing belongings rather than buy new ones. That’s why businesses like car repair shops and appliance stores do well during tough economic times.
Debt collection is another business that does well in a recession. More people default on their debts during a recession, and businesses need help collecting what they’re owed.
Freight companies are always in demand, but they do especially well during a recession. That’s because businesses rely on them to transport their goods, and they’re willing to pay extra to get their products delivered on time.
Home improvement businesses also do well in a recession. Many people are looking for ways to save money by doing things themselves.
And with more time on their hands (sometimes), people are also more likely to tackle home improvement projects that they’ve been putting off.
Waste management also does well in a recession. Businesses and households alike still need to dispose of their waste, even when money is tight.
Telecommunications is not typically affected by a recession. People rely on their phones and the internet to stay connected, even when the economy is struggling.
While changing jobs or starting a business can be a good way to survive a recession, there are other things you can do as well.
- Review your expenses and make changes where necessary.
- Invest in education by taking courses and learning new skills – as long as they are appropriate and you take the time to implement the skills you learn.
- Stay positive, and don’t give up hope. Things will eventually get better.
- Help others who are struggling. This can make you feel better while also making a difference in the world.
- Reach out to your network of family and friends for support.
- Make a plan and focus on your goals. This will help you stay motivated during tough times.
- Take care of your health both physically and mentally. This is important at all times, but especially during a recession when things can be stressful.
These are just a few of the things you can do to survive a recession. You’ll make it through to the other side if you’re smart and prepared. And who knows, you might even come out ahead.
When a recession hits, it is a great time to start a budget and start saving more money. You may not have as much income as you did before, but if you’re careful with your spending, you can still make ends meet.
It’s also a good time to start thinking about ways to make extra money. If you have some skills or talents that you can offer others, now is the time to start freelancing or becoming a consultant. There are also many opportunities to make money online.
Another way to make the most of what you have is to barter with others. If you have a skill or service that someone else needs, see if they’re willing to trade something of equal value in exchange.
This can be a great way to get what you need without spending any money. Reach out to your network of friends and make connections!
Bartering can also be a great way to save money on things you would typically have to pay for. For instance, if you need your car repaired, see if there’s a mechanic who’s willing to trade his services for something else you have to offer.
There are many steps that you can take now to help prepare yourself for when the next recession hits.
- 1. Make a budget and stick to it. This will help you keep track of your spending and make sure that you’re not overspending.
- 2. Don’t buy things that you don’t need. This is easier said than done, but if you can live without something, don’t buy it. Read How to Stop Spending Money
- 3. Invest in stocks, bonds, and other investments. This will help you make money even when the economy is struggling.
- 4. Start a side hustle. This can give you extra income that you can use to pay your bills or save for a rainy day.
- 5. Stock up on necessities. This way, you won’t have to go out and spend money on things like food and toilet paper when a recession hits.
No one likes to think about a recession, but it’s important to be prepared just in case. By following these tips, you can help ensure that you’ll be able to weather any economic downturn.
A recession is a tough time, but there are still businesses that do well. That’s because people still need to eat, stay healthy, and have fun, even when times are difficult.
So if you’re looking for a recession-proof business, consider one of the industries on this list. You just might find the perfect business for you that can thrive during a difficult time.
Are you a business owner? How has/will the recession affect you? Comment below!