BIZGrowth Newsletter - Economic Slowdown Solutions Special Edition

I D E A S T O M A S T E R A S L O W - G R O W T H E C O N O M Y
S T R A T E G I E S
ISSUE 94 | WINTER 2023
Your Team.
Your Team.
TimetoConsidera
ReductioninForce?
TipstoPreparefor
RiskManagement
Challengesin2023 HRBestPractices
toPreparefor
aRecession
3Tacticsto
Recession-Proof
YourBenefitsStrategy
3Innovations
toStayNimble
intheFaceof
anEconomic
Slowdown
ECONOMIC SLOWDOWN SOLUTIONS
— Special Edition —
DisabilityInsurancefor
BusinessOwners—More
ImportantthanEver
Recruitment
Strategies
toKeepYou
Competitive
in2023
Recruitment
Strategies
Recruitment
Strategies

While there are no guarantees in economics, 2023 looks
to bring another dose of volatility and uncertainty, with
all signs pointing to an economic slowdown and, possibly, a
full-blown recession. Businesses must not hesitate to prepare.
It will take leaders from multiple operational areas
working together to expediently identify and implement
the appropriate strategies that will lead to stability for your
business and your employees.
Our professionals have developed these articles and linked
resources to help your business master a slow-growth economy
and come back stronger once we’re through the storm.
In This Issue
2 | BIZGROWTH STRATEGIES — WINTER 2023 CBIZ, INC.
CBZ
To subscribe to this newsletter
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DISCLAIMER: This publication is
distributed with the understanding that
CBIZ is not rendering legal, accounting or
other professional advice. This information
is general in nature and may be affected
by changes in law or in the interpretation
of such laws. The reader is advised to
contact a professional prior to taking
any action based upon this information.
CBIZ assumes no liability whatsoever in
connection with the use of this information
and assumes no obligation to inform the
reader of any changes in laws or other
factors that could affect the information
contained herein.
— Special ECONOMIC SLOWDOWN SOLUTIONS Edition —
F
orty-six percent of working-age adults skipped or delayed care in 2022
because of the cost, according to the Commonwealth Fund Biennial
Health Insurance Survey. While increased health care costs are not
a new challenge, the addition of skyrocketing inflation and an impending
economic slowdown has created additional barriers to care for employees
and budgetary constraints for employers.
In 2023, employers face the task of determining how to enhance the
affordability of their benefits while maintaining quality and, most importantly,
keeping organizational costs as low as possible. In this article, we explore
three tactics to help you strike this seemingly impossible balance and be
proactive as a potential recession looms.
1.
Think Beyond High-Deductible Health Plans
While your business can’t control rising inflation and its impact on
health care costs, you can do your part to minimize barriers to care in your
benefits offerings. Continuing to offer high-deductible health plans isn’t
the right strategy for all employers, especially those whose workforces are
dominated by hourly or part-time workers.
It’s essential to consider nontraditional solutions that are cost-effective
for your organization and increase your ability to connect your employees
to adequate, affordable health care, such as the Health Benefit Alliance
3Tacticsto
Recession-Proof
YourBenefitsStrategy
Tactics to Recession-Proof
Your Benefits Strategy....................2
3 Innovations to Stay Nimble
in the Face of an
Economic Slowdown.......................4
Tips to Prepare for Risk
Management Challenges
in 2023.............................................5
HR Best Practices to
Prepare for a Recession.................7
Time to Consider a Reduction
in Force?...........................................8
Recruitment Strategies to Keep
You Competitive in 2023...............9
Disability Insurance for
Business Owners — More
Important than Ever......................10

(HBA). The Health Benefit Alliance features ERISA and
ACA-compliant health plans tailored to the needs of
employees who’ve had difficulties accessing care. HBA
plans are also priced at reasonable rates for employers,
making them an excellent choice for 2023.
2.
Explore Alternative Funding Strategies
A large contributor to the unaffordability of health
care is employers’ lack of control within traditional
funding mechanisms. In 2023, consider taking the
insurance company out of the driver’s seat and putting
your organization behind the wheel by shifting to an
alternative funding strategy, such as self-insurance.
Self-insurance is an arrangement in which a health
plan is funded entirely by the employer. As opposed
to an insurance company paying for employee health
claims, self-insured plans put that responsibility on the
employer, granting you greater control over plan design.
This increased level of control enables you to put your
employees’ financial wellbeing first.
3.
Consider Captives
A captive is an alternative risk solution for mid-sized
Watch our on-demand
webinar, “Recession-Proof
Your Executive Benefits —
Tactics to Cut Costs While
Retaining Top Talent.”
Connect with a CBIZ Employee Benefits
specialist today.
employer groups. Members of a captive partner with
other employers to increase their buying power for stop
loss coverage and pool money for larger claims while self-
funding their smaller claims.
If you’re looking for a solution that will help you
secure high quality benefits at lower costs and grant
you the flexibility to choose plan design, network and
structure, consider a captive. This unique approach to
employee benefits can help you identify unique cost
drivers and enhance affordability from the top down.
The most effective way for your organization to
assist your employees during this economically trying
time while keeping costs low is to think outside the box.
By disrupting the status quo and seeking nontraditional
solutions, you can help reduce the staggering number of
individuals who can’t afford health care, get ahead of a
potential recession and come out of 2023 on top.

aligned with their strategic framework, leading to less-
than-optimal decision-making and inconsistencies.
With costs rising and margins shrinking, CFOs are
now reevaluating their budgeting strategies. Under
normal circumstances, CFOs have typically taken a more
static approach to the budget, focusing on long-term
planning and goal setting. However, with disruption being
the new norm in today’s business landscape, companies
must take a more agile focus in responding to new
opportunities or challenges.
Driver-based budgeting can be a way to adapt quickly
during potential disruptions, such as economic volatility.
This budgeting method links your organization’s resources
and activities to the financials in the budgeting process,
which provides a clearer picture of where money is being
spent. This allows organizations to better understand how
their activities impact their bottom line and make more
informed decisions about where to allocate resources. It
can also help improve communication between different
departments and ensure that everyone is working toward
the same goal.
3.
Embracing the Reshoring Trend
In the age of globalization, most companies have
come to rely on overseas suppliers for raw materials
and components. This dependence on foreign suppliers
has left many companies vulnerable to supply chain
disruptions, which can devastate operations. In the wake
A
s the saying goes, “a rising tide lifts all boats.” But
what happens when the tide starts to ebb?
An economic slowdown can be a daunting
prospect for any CFO. However, by taking a proactive
approach and finding innovative solutions, it’s possible
to navigate uncertain waters and come out on top.
Addressing supply chain disruptions, finding easier ways
to budget or streamlining accounting practices can help
your company thrive.
The following describes three innovative ways CFOs
can approach a potential economic slowdown.
1.
Taking Advantage of LIFO
In any business, inventory is a crucial component. It
represents an investment of time and money and must
be carefully managed to maximize profits. One of the
most favored methods when accounting for inventory
is first in, first out (FIFO). The internationally approved
approach appeals to many businesses because it’s a
straightforward process, allowing the oldest inventory
items to be recorded as sold first.
However, in times of record-high inflation,
businesses may want to consider the last in, first out
(LIFO) accounting method, as it can more clearly reflect
current income by valuing inventory at its current market
price. Under this method, a business records its newest
products as the first items sold. LIFO is beneficial for any
company facing rising costs because the method allows
companies to report lower net income and lower book
values due to the impacts of inflation, often resulting in
lower taxation.
The tax benefits of LIFO grow as inflation increases
and if inventory quantities remain steady or increase.
As a result, companies using LIFO may see their cash
flow improve in the short- and long-term, especially
if inflationary trends continue. This makes LIFO an
attractive option for companies looking to maximize their
cash flow in periods of high inflation.
2.
Focusing on Driver-Based Budgeting
A well-oiled machine has many moving parts that
work together to achieve a common goal. If one part is
not functioning correctly, it can throw the whole system
off balance. The same is true for an organization — to run
smoothly, its parts must work in harmony. Unfortunately,
many organizations don’t have their budgeting processes
3InnovationstoStayNimbleinthe
FaceofanEconomicSlowdown
(Continued on next page)

T
he outlook for the property and casualty market
remains challenging. Economic uncertainty from
inflation, supply chain exposures, and increasing
litigation and settlements will impact premiums. Pricing
and terms are the keywords insureds should be prepared
to hear from their broker in the upcoming year. While
these factors are uncontrollable, there are opportunities
to improve your options and lower your risk.
A trusted broker will find the best coverages and
pricing to meet your business goals. To help ease the
pain, we suggest being proactive in these four areas.
Valuation
Make sure your commercial property is appropriately
valued. An undervalued assessment can cost you in
the long run. Many owners have recently discovered
their policies undervalued and footed the bill for claim
damages and coinsurance penalties. These inaccuracies
are too common, with an estimated 75% of commercial
properties being underinsured by 40% or more.
Also, review your coverage to verify that the policy fits
your business needs. Always consider your property type
as it may be more financially stable to secure a policy
that offers adequate coverage with lower premiums. Your
broker can offer numerous options as multiple factors
may influence your property’s value
Safety
Implementing a health and safety program as part
of an overall culture of safety can offer cost-saving
TipstoPrepare
forRiskManagement
Challengesin2023
opportunities to impact your organization’s bottom line,
such as:
■
Injury Prevention: Lower injury rates can calculate
as cost savings that your safety initiative is
yielding.
■
Productivity Time Lost: A culture of safety
promotes employee health and increases
employee engagement. When employees perceive
they’re in a safe workplace, this can lower stress
and increase productivity.
of the pandemic, companies have faced supply chain
challenges due to geopolitical unrest and prolonged
COVID restrictions, forcing many to reevaluate their
sourcing and manufacturing strategies.
In recent years, however, more and more companies
are turning to reshoring to improve resilience and protect
their bottom lines. Reshoring is the process of moving
production back to the country of origin. By reshoring
supply chains, companies can reduce lead times,
improve quality control and increase responsiveness to
customer demand.
The trend of reshoring will likely grow even more in
the coming years as more and more companies realize
the competitive advantages. Reshoring is not only about
addressing immediate supply chain concerns; it also
offers many long-term benefits, such as reducing reliance
on foreign suppliers and creating new jobs in the U.S.
Reshoring could be crucial to rebuilding the American
economy and ensuring it remains globally competitive.
(Continued on next page)
(Continued from previous page)
Connect with a CBIZ Financial Services
advisor to learn more.

■
Compliance Costs: OSHA citations and fines can
be costly. Compliance can also help prevent OSHA-
imposed shutdowns and lost revenue.
■
Insurance Expenses: Health and safety
enhancements ultimately factor into your premium
rates. Continuous improvements and a long-
term commitment to safety significantly impact
your rates. Additionally, some carriers will offer
discounts for initiating risk mitigation programs
and the strategies they offer.
Social Consciousness
Environmental, social and governance (ESG) factors
are often considered by socially aware investors when
evaluating companies on sustainability and social
conscientiousness. While ESG metrics can be hard to
measure, the risks surrounding them are increasing. As
consumer, investor and shareholder actions are focused
on ESG, your company, directors and officers must
proactively address climate change, working conditions,
cybersecurity and diversity. The following trending
ESG exposures pose the most significant risks for your
business and can impact your premiums.
■
Climate Change Pollution Actions:
Stakeholders demanding transparency are
accusing companies and their directors and
officers of failing to adequately disclose climate
change material risks. Ultimately, your directors
and officers must ensure appropriate climate
change reporting and due diligence.
■
Board Diversity: Lawsuits allege directors and
officers are failing to perform their duties to
support adequate levels of board or management
diversity. If your business is deficient in racial,
gender or age diversity, you could be subject to
investigations and lawsuits.
■
Cybersecurity: Your company should address
its cyber risk-monitoring processes to protect
data. As cyber threats become more prominent,
your organization will be forced to become
more transparent in cyber protection plans
and policies.
Cybersecurity
As hackers find new ways to invade your network,
carriers will rely on prevention efforts when evaluating
your cyber application. Underwriters are tightening
availability, and insureds must prove protection efforts
for any cyber liability insurance consideration. Prepare
your organization for a successful cyber application
process with these recommended controls:
■
Close unused remote desktop protocol (RDP)
ports.
■
Use multifactor authentication (MFA).
■
Have a data management strategy.
■
Run endpoint detection response (EDR).
■
Segregate backup data from the main network.
■
Make risk management a priority.
■
Perform annual employee training.
■
Refuse end-of-life operating systems.
■
Perform gap backups.
■
Create a business continuity plan (BCP).
While the continued hardening of the market
can seem daunting, your insurance broker can help
you understand the current trends that influence the
commercial insurance industry, how they can impact your
coverage and premiums, and how to best manage them
to your organization’s benefit.
(Continued from previous page)
Connect with a CBIZ Business Insurance
expert today.

HRBestPracticesto
PrepareforaRecession
W
ith the economy already showing signs of a
recession brewing, businesses must be agile
enough to adjust to the risks and impacts.
Successful organizations are taking steps to be prepared,
including reviewing human resources (HR) practices and
making adjustments to help maintain financial stability.
Here are some tactics to help your business stay
afloat and competitive amid uncertain economic times.
Consider Unique Benefits
It’s no secret that many employers responded to
recent labor challenges by increasing
salaries, providing substantial
bonuses, and expanding employee
benefits and perks. But now,
businesses concerned with the
possibility of a recession are looking
for ways to reduce their benefits costs
while still supporting employees’
needs and wants. Some employers
are identifying and implementing
unique benefits that come at little to
no cost. Bottom line, your HR team and
managers should evaluate your current
compensation and benefits offerings
and adjust accordingly to the current
economic climate, with a keen eye
toward future uncertainty.
Automation
Your business may benefit
from new automation that reduces
costs while improving efficiency. If
you’re struggling to manage payroll,
recruiting, onboarding or other HR
functions, there are cost-effective
solutions to help. Your business may consider tapping
into HR solutions that automate recruiting, onboarding,
payroll, offboarding and other HR functions so that your
team can focus on more strategic initiatives and efforts
that would benefit from a personal touch.
Minimize Layoffs
Layoffs should always be a last resort and should
occur only after evaluating the need for organizational
downsizing. Working with managers to identify areas
where costs can be reduced is ideal. Additionally,
measures such as job-sharing or reducing hours of
operation should be considered. Another way to minimize
the need for layoffs is by implementing voluntary
reduction in force (RIF) programs or choosing to slow or
pause hiring entirely.
Stay Transparent
Being transparent with employees about the
challenges your business is facing, especially during
an economic downturn, is essential.
Regular, honest communication will
ensure that workers are educated and
can make informed career decisions.
Additionally, being open enhances
employees’ trust in leadership
and helps them to focus on their
responsibilities.
Focus on Employee Engagement
Employee engagement is essential
for any business, especially during
tough times. It helps to create a work
environment where employees feel
valued and appreciated. Consider
organizing regular team-building
exercises or remote social events and
creating a collaborative workspace.
Additionally, regularly check in with
your staff to get a pulse on how they’re
doing and respond thoughtfully and
appropriately.
These are just a few ways HR
professionals can prepare for an
economic downturn — even one that
escalates into a recession. By implementing these HR
best practices, you can help ensure your organization
remains financially secure while providing stability to
your employees and value to your customers.
Connect with a CBIZ Human Resources expert
for more strategies and resources.
Even during more stable
economic times, keeping
up with your business’
HR needs can be
challenging. Check out
our HR Professional’s
Guide to 2023 — a
calendar of monthly
tactics and activities to
help you stay on track.

organization customize a program to fit your unique
needs, prepare communication materials in compliance
with legal requirements, perform ongoing program
administration and provide outplacement services for
terminated employees.
Since the decision to implement a RIF is often made
after all other alternatives have been exhausted, it’s
important that this solution is designed and implemented
properly. In addition to managing effects on employee
morale and performance, your organization must comply
with various legal requirements to minimize liability.
A successful workforce reduction program can
ultimately help your business avoid the pitfalls that
could come along with a reduction in force. For example,
a third-party service provider may be able to help you
implement a voluntary separation program with a
severance package as an alternative to a less favorable
involuntary program.
If you’ve worked with a partner to implement a
workforce reduction program, be sure to make a conscious
effort to promote your company’s optimized position,
support terminated employees and empower remaining
employees to face the challenges that lie ahead.
A
s economic indicators continue to point toward
a recession, the Federal Reserve has been
taking aggressive action to fight inflation. After
careful consideration, many U.S. employers have been
reevaluating their workforce and deciding that an
immediate reduction in force (RIF) is necessary to reduce
costs and increase efficiency during these uncertain
times. Now is the perfect time to start thinking about
whether the size and composition of your workforce is
optimal, considering the current market conditions.
Is your organization prepared to absorb the potential
shock of a recession, or do you need to consider a
permanent reduction?
First, consider whether any alternatives could save
the same amount of money:
■
Limit Overtime — Reduce or eliminate opportunities
to work more than 40 hours per week.
■
Reduce Benefits — Temporarily adjust insurance
premiums and cut non-essential benefits.
■
Hiring Freeze — Temporarily pause the hiring of
non-essential employees.
■
Natural Attrition — A gradual process in which
employees leave and are not replaced.
■
Part-time/Temporary Employee Layoffs —
Redistribute part-time/temporary employees’
responsibilities to full-time employees.
■
Mandatory Furloughs — Require a temporary
leave of absence or a reduced schedule.
Sometimes, a reduction in force is still the only
feasible option. There are two types of workforce
reduction programs:
■
Voluntary — The employer provides incentives to
eligible employees who can decide whether they
would like to agree to these terms and terminate
their employment.
■
Involuntary — The employer selects certain
employees for termination and offers them
incentives in exchange for their agreement to
refrain from legal action.
Reductions in force are multi-faceted endeavors
that most companies are not comfortable navigating on
their own or simply don’t have the capacity to execute.
So, many work with a third-party service provider to
design, implement and manage a reduction in force
program, ultimately freeing your team to focus on other
business priorities.
A skilled RIF advisor can conduct a cost-benefit
analysis of various design options to help your
TimetoConsideraReductioninForce?
Connect with a CBIZ professional to learn more.

effective way to acquire top talent. Especially when
targeting Millennials or Gen Z candidates, social media
use is a common denominator among these groups.
Employer Brand Reputation — Maintaining
a positive employer brand — how you present your
organization to potential and existing employees —
showcases your company culture and gives prospective
candidates a taste of what their employee experience
would be like. This includes sprucing up the organization’s
virtual front door (e.g., website) and physical plant.
Applicant Tracking Systems — These software
applications enable organizations to monitor candidates
throughout the hiring process. From filtering relevant
candidate data to streamlining the onboarding process,
ATSs are the most efficient tool for an unruffled
recruitment process. Also, artificial intelligence (AI) tools
are gaining popularity and becoming more affordable,
even for smaller organizations.
Don’t Drop the Ball in 2023
Embracing the latest talent acquisition trends and
recruiting practices will help your business attract,
acquire and retain the right candidates to meet
the challenges of 2023 and take advantage of the
opportunities the new year presents.
R
ecruiting quality talent is an ever-present goal for
every organization. However, to stay competitive
your business must differentiate its techniques.
More than adding a competitive advantage, modern
recruitment strategies are proving to be an efficient
asset in terms of effective and timely hiring practices,
particularly in today’s challenging economic environment.
The future of recruiting will include automation,
strategic planning and better integration with company
objectives to align with constantly changing technology
and techniques.
Hiring Techniques to Look Out For
Staying up to date on the latest recruitment
practices can feel overwhelming, with new tools and
technologies constantly being introduced to streamline
the hiring process. Taking the initiative to learn and
embrace these efficiencies, however, will benefit your
organization’s recruitment efforts greatly.
Video Interviews — While talking with a potential
candidate, an in-person conversation is obviously ideal.
If the candidate cannot make it into the office, a virtual
interview is a clear accommodation message on your
organization’s behalf, which is an asset in the eyes of the
candidate. Also, it extends your reach to candidates who
may live in a distant region.
Social Media — Be it on professional networks like
LinkedIn or more relaxed ones like Facebook, accessing
candidates on these platforms can be an easy and
RecruitmentStrategiestoKeep
YouCompetitivein2023
Connect with a CBIZ Talent Compensation
consultant today.
Get your free copy of
“The Road Ahead:
Predictions for
HR in 2023.”

©
Copyright
2023.
CBIZ,
Inc.
NYSE
Listed:
CBZ.
All
rights
reserved.
|
CBIZ-020,
Rev.
94
between the ages of 35 and 65 can expect to become
disabled for five years or longer.
By using one or more of these strategies and adding
disability insurance to your business plan, you’re protecting
your business against the unexpected, which is even more
critical in today’s tumultuous economic climate.
A
s a business owner, you know it’s important
to protect your business from threats such as
cybersecurity, liability and more. But is your
business protected if something happened to you —
especially in today’s turbulent economic times?
Disability insurance protects you and your business
in the event that you can no longer work due to a
disability. Having this plan in place is especially important
as we enter a new year with a chance of an economic
downturn and, possibly, a recession.
Here are five key disability insurance options that all
business owners should know about:
1. Individual Disability Insurance
This individually purchased and owned policy is
designed to protect your income if you cannot work
due to illness or injury and can cover up to 60% of an
individual’s lost salary.
2. Disability Overhead Expense Insurance
This is specifically for business owners to pay business
overhead expenses, including rent, utilities, employee
salaries and payroll tax, in the event they become disabled
or ill and can’t continue to run the business.
3. Disability Buy-Sell Insurance
Disability buy-sell insurance provides the funds to
allow a company to continue paying the insured person’s
salary or to completely buy their share of the business if
their disability is permanent.
4. Bank Loan Disability Insurance
Also known as credit disability insurance, this policy
will make payments to an existing loan or line of credit for
a specified period of time in the event you are disabled
from work due to injury or illness.
5. Key Person Disability Insurance
Key person disability insurance helps a business
offset the financial burden of a key contributor being
disabled. The business pays for and owns the policy with
benefits paid to the business.
You owe it to yourself to develop a plan to protect your
business in the event that you become disabled. In fact,
according to a study by the Social Security Administration,
one in four people could expect to miss at least one year
of work due to a disability, and about one in seven people
DisabilityInsuranceforBusiness
Owners—MoreImportantthanEver
Connect with a CBIZ Life Insurance
advisor today.

BIZGrowth Newsletter - Economic Slowdown Solutions Special Edition

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BIZGrowth Newsletter - Economic Slowdown Solutions Special Edition