How To Survive An Economic Recession, If It Knocks on Your Door: A Survivor’s Guide

Money Matters

How To Survive An Economic Recession, If It Knocks on Your Door: A Survivor’s Guide

Illustration: Robin Chakraborty

Okay, I admit, this is not exactly a cheerful time.

As if authoritarian leaders, wars and burning rainforests weren’t enough to contend with, we now have the very real possibility of a recession breathing down our necks. There are economic indicators that say so, and a number of political-numbskullery-induced factors, such as Brexit and the US-China trade war exacerbating the uncertainty.

“That’s all global!” you say. Well, India will not be shielded, even if it’s for no fault of our own. Trade will be affected. Clients for our massive service sector will pull out. Indian subsidiaries of global companies will tighten their purse strings. People will go to restaurants less. Passwords for streaming services will be shared. Even if it isn’t a full-blown recession, India will face a slowdown — and we’re already seeing this, in sectors like automotive, for instance.

So that’s the bad news. If you’re waiting for good news, I can’t say I have any (unless you count the imminent destruction of the planet and the chance we may not even reach a recession as “good news”). However, what I do have for you — especially for those of you who have started working recently or are about to — is a bit of advice, drawn from personal experience.

You see, about a decade ago, the world went through a major recession, because some US banks got adventurous (yes, it’s the US’s fault) and yours truly just happened to graduate from a B-School. Back then, the mood on our campus swiftly went from, “When I buy my first BMW…” to “Take the first job you get”. It was a precarious start to a post-MBA career, what with a massive loan (the EMI of which would be a third of my salary) and Mumbai costs incoming. Surprisingly, my college brochure never mentioned any of this.

Even if it isn’t a full-blown recession, India will face a slowdown — and we’re already seeing this, in sectors like automotive, for instance.

But I survived through enough to write this article. So, for those of you who are worried, here are some tips. A little belt-tightening and willingness to experiment can help you not just survive, but thrive when it’s all over. And yes, it’ll be over.

Tip 1: Scale down your lifestyle

I’m sorry to start by saying the most uncle thing, but it’s important. Even if the R-word is still months away, it’ll help you prime yourself. There are several resources online that’ll tell you how to save money, so I won’t bother you with a treatise of my own. I will, however, say this: There’s a lot of great entertainment to be had for cheap. Discover new music. Watch a new series. Read a book. Go on a trek. Cycle. Discover your city. Adopt a cat. These small joys will fill up your time, enrich you, and most importantly, not cost much. My first few months in Mumbai, for instance, were full of cheap, local rock gigs. What better way to celebrate being broke than listening to angsty songs about being broke?

Bonus tip: Start maintaining accounts. It’s a very good habit and has the added advantage of teaching you some Excel (<3) along the way.

Tip 2: Invest (some of) your money

Oops, I’ve lost you now! I get it. I hated hearing this word as much as you probably do, but it’s still the one thing I’d do more of if I had a time machine. Investing might seem complex, but again, there are several resources out there that will help you. Take the advice of a neutral platform over a bank’s website, because banks have their own agenda.

Here are two things about investing you should know. The first, money grows over time thanks to this beautiful thing called compound interest (₹1000 per month in a decent mutual fund = close to ₹2 lakh in 10 years). The second thing is you can start small. Even if it’s just ₹1000 a month. When your next salary comes in, put a small portion of it away before you crack open the beers, and watch your money grow exponentially. 

Tip 3: Invest… In yourself

(cheese overload, sorry – let me rephrase that)

Tip 3: Take up unconventional(ish) career options

Working during a recession is tense. You don’t know when you’ll be out of a job or — powers forbid — whether you’ll find one. But here’s the thing about business: Like showbiz, it must go on. It may not seem obvious, but some industries even boom during a recession.

When I graduated from MICA, I was looking forward to a career in a big advertising agency, but it was around the time recruiting stopped because client budgets dried up. However, companies still needed to advertise, so they chose a cheaper medium — this newfangled thing called digital. Voila, I landed a job in a small digital company. That too, after hunting them down and writing to them myself. Now while I may not adorn the cover page of your average business magazine, I’ve done okay for myself — to the point where some of India’s best B-schools have asked me to teach digital marketing. So in a way, I have the recession to thank for my career. 

Such opportunities will open up to you as well during times of downturn. Write to a company you admire. Offer your services. Everyone needs good people. It might not be at the pay scale you feel you deserve, but in conjunction with Tip 1, you could make it work. For the more adventurous lot, it’s also a great time to start something new. Sure it will take a couple of years to get your bearings and credibility, but by that time the economy should have recovered.

A slightly related point: Consider doing freelance work, either full-time or after-hours. During the previous recession, I did a ton of freelance jobs, often literally for free — writing, cartooning, whatever I felt like. The free gig reviews I did in 2009 eventually led to me getting a full-time job at OML in 2016, and working on the NH7 Weekender festival. 

Also, keep in mind, as the slowdown hits and companies look to cut corners, they will be more receptive to “cheaper” options, such as freelancers. So get out there — hustle, network, and build up a body of work. Moolah will follow. Credibility, too, grows in compound interest-like ways.

Tip 4: Study

If nothing else, study. It’s a clever (and brave) thing to do. Higher education will not only bolster your CV right in time for an economic recovery, it will also shield you from working through unpredictable times. There are caveats. You need funds, so you’ll forsake whatever you could have saved/invested (a little concept known as “opportunity cost” in B-schools), and heck, who knows if the economy will be gleaming when you graduate? Not to mention, you actually need to prepare for an entrance exam, and in times of a potential recession, the competition will be higher. Still, it’s an option to consider. 

So there you have it. While graduating in ’09 was not pretty, I’ll admit, there are some choices I made, and habits I picked up, that helped me get to where I am today. When I decided to jump into the untested waters of digital advertising and started doing free freelance writing, I thought to myself, “If this works, I’ll write an article during the next recession saying things will be fine.”

Things will be fine.

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