Rescue in a crisis: an expert gave universal advice for freelancers and entrepreneurs

After the start of the special operation in Ukraine, Russia faced unprecedented sanctions from the United States and the European Union. The small and medium-sized enterprises (SME) sector has been hit hard. Now, whether a person is employed, freelancing, or owning a business, it’s good to have a roadmap in case of a crisis. What could be this “Plan B”, “MK” said the operating director of the technology platform “Rocket Work” Sergey Sukhostavets.

– The crisis faced by the country as a result of unprecedented sanctions pressure is seriously affecting the entire business segment. How are companies reacting?

– Judge for yourself. According to the estimates of the Center for Strategic Research (CSR), about 8 million people are employed only in foreign or related companies in our country. All of them are at risk. The SME sector, which has already been significantly thinned out by the pandemic, is also suffering.

Against the backdrop of increased sanctions pressure, the number of small and medium-sized enterprises from February 10 to May 10 increased by only 108 thousand – up to 6 million, follows from the register of the Federal Tax Service. However, growth occurred only at the expense of micro-enterprises, which may rather indicate a fragmentation of companies. The number of small companies has decreased, while the number of medium ones has remained almost at the same level. The number of people employed in the SME sector also decreased from 14.64 to 14.59 million.

– Is it possible to identify specific reasons for the decline in employment?

– The destruction of the usual supply chains, the decline in imports, difficulties in banking, inflationary acceleration – all this reduces the profitability of enterprises and forces companies, at best, to slow down or suspend hiring, at worst, leads to staff cuts, cuts in wage funds and an increase in shadow unemployment.

So, in June 2022, compared to last year, the need for new employees fell by 15.2%. In such conditions, many of our compatriots are at risk of losing their jobs and income. At the same time, the situation is no better for business owners, who also feel the pressure of sanctions and a decrease in consumer activity. Many citizens have switched to a savings model of behavior, postponing purchases and spending only on the essentials. Against this background, of course, many entrepreneurs whose business is not tied to consumer products and services will have to reconsider their business models, cut their own costs in order to stay afloat.

– How should a person who is employed or has lost his job act now?

It’s getting harder to find a job now. Many companies go into savings mode and slow down hiring, some even close.

First, assess your position. Have you already had cuts? What does the boss say? Don’t be afraid to ask openly about the company’s prospects and your own. Remember that in the event of a reduction, under labor law, you are entitled to a compensation payment in the amount of three salaries in the first three months after dismissal, if you cannot find a new job during this time.

If you have been left without payment or delayed in paying your salary, you can always contact the labor inspectorate. Also, it will not be superfluous to start looking for an alternate airfield – post your resume on job search sites. And in parallel, you can invest in your own skills – sign up for advanced training courses or even master a new profession. Even in such difficult times, in many areas, demand among employers remains fairly stable. So, IT-specialists, marketers, financiers, lawyers, anti-crisis managers, engineers and many others are in demand. In other cases, it will not be superfluous to look for work in other directions, think about what you are good at, and try to monetize these skills.

– Despite the current crisis, many freelancers, on the contrary, face increased demand for their services. What is it connected with?

– According to PWC, the volume of the freelance services market in the country is growing by an average of 15-20% per year and by 2025 will grow 2.5 times, up to $102 billion. Companies, in order to optimize costs, are more actively switching to the model of staff hiring and outstaffing . This provokes demand for the services of freelancers. But not everyone can be lucky. If suddenly you are faced with an outflow of customers, review the costs first. If you worked as an individual entrepreneur, it is better to change your tax status to self-employed.

– And what can you advise entrepreneurs: how can they survive in the current crisis?

– The state continues to issue preferential loans, simplifies access to participation in public procurement and offers affordable rental of municipal property. This can be an excellent source of budget replenishment and cost optimization. However, even preferential loans at a reduced rate will have to be paid back. Therefore, before applying for a loan, make a good assessment of your ability to service debt and revise the processes in the company, perhaps additional resources – this is not so much a question of a loan as a competent optimization of the company.

Does the staff perform redundant functions? Consider cutting back. Are specialists in the state too expensive? Look towards outsourcers. Suppliers bend prices or can no longer fulfill the terms of the contract? Explore the market, look for new counterparties in the local or Asian markets.

– Advice about cutting costs is generally universal in a crisis period and is suitable for both companies and individuals. Are there other general recommendations?

– In times of economic turbulence, it is better to revise consumption volumes downwards. The advice about finding additional sources of finance will be just as universal. For companies, this can be access to new markets, for hired workers – freelancing and part-time jobs that can be found through social networks, word of mouth or specialized marketplace platforms.

The main thing is not to ignore it in a crisis and not to sit idly by. Even if everything is fine with you now, the economy and the market work in such a way that everything in them is interconnected, so the wave will cover everyone sooner or later. Don’t waste your time.

Published in the newspaper “Moskovsky Komsomolets” No. 28847 dated August 16, 2022

Newspaper headline:
“The main thing in a crisis is not to sit idly by any means”