Many Countries Are Currently Experiencing an Economic Downturn - Coursework Example

Running head: Many countries are currently experiencing an economic downturn Title: Institution: Instructor: Date: Economic downturn is hitting hard in the whole world Summary of the essay In the introduction, the essay describes how economic downturn has affected various countries using the example of Russia. There is increase in oil prices that has made the life of people difficult. The whole world is facing the impact of unemployment due to economic down turn. There is a possibility of no more productions by the countries. The essay gives details related to the worst economic down turn during World War II. Here the British economy was severely affected together with the United States. The essay gives some solutions that can be used by countries to survive in the economic down turn. In order to survive in the economic down turn countries should make efforts to provide finances to its customers, low unemployment in the country and low interest rates. Managers should involve employees in making decisions for the organization and help then during lay offs Managers need to set good compensation skills for employees who fail to get their dream jobs in the organization. Employees need assistance from the manager in debt management as well as giving them a chance for more flexible time to perform other jobs to increase their earnings. The conclusion describes various effects of the economic downturn. The presence of economic down turn has lead to the increase in responsibilities of citizens. There has been increasing prices of products that has affected the whole world. There are also solutions that managers can use to help with employees during economic down turn. Introduction Economic down turn Economic downturn is one of the four stages that make an economic cycle. It is a time when an economy starts leaving boom and start moving down the cycle to recession. Economic down turn is a situation that is faced by many countries of the world. According to Stack (2009), a country like Russia is faced by economic down turn. This is evident in the situation that is faced by the Moscow theatre due to the cutting of budget. It has called off the opera premier and a ballet tour of Mexico. Around the whole world countries have been threatened by the experience of economic down turn. Countries like Ireland, Spain and South Africa have experienced their real estate prices going down. In addition the collapse of U.S. automakers has brought a tremendous effect to plants in Canada, Mexico and Germany. The international monetary fund has predicted that this is the first time that the whole worldwide economy will contract. There is fear in the whole world that there will be no more new productions. Budget constraints in Russia have forced a failure in tour to Mexico. This is highly influenced by the increase in oil and gas prices that have risen and affected the economies of the whole world. The country had canceled productions before because we were not satisfied with the artistic value. Productions in the theatre have been cancelled due to financial crisis in Russia. There is uncertainty at the Bolshoi and this is a good representative of the problems that Russia is facing. This is as a result of swift economic disorder that is hitting hard to the national standards. It is difficult for Russia to cope with the prices of oil that are going up everyday and the popular Book berry bookstores is going insolvent (Stack, 2009). It is evident that the theater's budget swelled to 12 times its former size over the last decade. This was an indication that Russia will grow to be an increasingly dominant and rich in the leadership of Moscow. This situation was disapproved after oil prices in the country went up drastically (Kieft, et al 2005). The rest of the state budget that slashed the Bolshoi’s government sponsorship this year by almost a tenth followed this crisis in oil prices. It is difficult for corporate sponsors to meet their debts and this is evidence that the country is experiencing an economic down turn. There has not been any renovation done to the Bolshoi's main stage and this has left the company stuck since the board are separated from it and are more concerned with a more prominent theatre. Worst economic down turn in fifty years Since World War II, the world has experienced the worst economic down turn. The world also sees that the British economy faces a severe slow down where its growth is expected to go down by 3% from last year to 1.7% next year. According to the prediction there are chances of acute economic weakness happening. United States is expected to fall into a complete recession. Surviving in an economic downturn Countries like Japan and Asia are already in recession and are not expected to rise in the near future. Recession in a country can be fought through the availability of finances to customers, ensuring that there is low unemployment in a country and giving lower interest rates (George, 2008). Consumer spending is expected to collapse and this will lead to a severe recession in the country. In order to prevent this U.K interest rates are expected to fall by at least 0.5% to 4% while in go down to a maximum of 2%. The suicide hijack attacks that happened in the U.S were responsible for the downturn. However, with the benefit of lower interest rates and increased public spending would be a solution to the UK economy as a whole to avoid recession. How managers should handle employees during an economic down turn According to Jones (1991), Poor economic conditions were announced in the New York Times that this would lead to dismissing 61 employees of the Newspaper Guild. Many citizens losing their jobs hence experiencing difficult times without or with little compensation followed this lay off. Lay offs in a country is seen as leading to economic down turn in the country. The purchasing power for the citizens is highly affected. A manager can take the action of getting ideas of dealing with the organization from employees. This decision has high possibilities of improving the performance of the business. Employees are required to be alerted on the future pans for the organization. Innovation According to Carey et al (2008), advocate that employees of a company are found to be innovative in one way of the other despite the budget deficits experienced by the organization. They help in identifying the areas that need innovation in the business. Managers are required to treat the employees of the company as brilliant ambassador. Employees of a company are a good source of influence in solving crisis that is faced by a company. The manager should take into consideration for the terms of employment of all the employees as well as recognizing their abilities (Coy, 2008). Ways of approaching issues by the manager At the time of layoffs Even the times of layoffs due to effects of down turn a manager has the duty of managing the employees and helping them to succeed. A manager is required to keep meetings short as well as taking the responsibility of what is happening in the business. The manager should continue building a relationship with the employees by helping them in the areas of problem (Lam, 1997). Layoffs in an organization combined with down turn for the employees may make them desperate and they may come asking assistance from the manager. This situation may make a manager uncomfortable but the manager should have all the courage to discuss the matters affecting the employee. However, many firms are forced to layoff employees in order to deal wit economic down turn. The situation of Dream jobs In the situation of a crummy job that comes as a result of dream jobs may become difficult for companies to cope with. This makes managers to take steps that can be used in the work place for dealing with changes that occur due to economic down turn. During a down turn a manager can make a decision of rewarding employees. These possess a situation of recession friendly employee advantages (Deborah, 1997). A manager is usually faced with the biggest challenge of laying off an employee at the time of economic down turn. The manager is required to have professional ethics when dismissing employees. This is an indication of good character and values that the manager possesses and a good picture for the organization. Debt management The manager is required to help employees of an organization in managing their debts. This helps the employees to ease the pressure created by falling earnings. It is important for the manager to take precautions and be good in financial management at the time economic down turn. There is need for the manager to create security concern for the employees of a company. This is a way pf motivating employees during an economic down turn without adding to the outcome. Managers help employees cope with the economic down turn effects through increasing their wellness. This can also be managed through good communication skills between the manager and employees in the organization (Coons, 2008). Employee flexibility According to Grapperhaus (1998), a manager is required to help employees deal with economic down turn by allowing flexibility in their work schedules. This helps employees have the time to the job uncertainties to re-evaluate their work and personal lives to balance for the long-term crisis that is hitting the whole world. Employees are found to perform several jobs at their time of rest. This helps them to multitask to get more money the can be used to cater for increased need of cash during economic down turn since products are expensive. Conclusion The world is faced with an economic down turn that has brought many problems to the publics. The citizens are faced with more responsibilities when it comes to the distribution of the available money in meeting their needs. The main cause that is believed to have caused economic down turn in the whole world is the increase in oil prices. Managers have the responsibility to help employees in dealing with various problems during economic downturn. Among all the things that a manger can do to help employees during this time the greatest is having good communication skills with employees. Good communication is seen to come first and the other things will follow. Annotated Bibliography Carey, J., Holden, D., & Gershkovich, T. (2008), The real question: should oil be cheap? Business Week, Academic Search Premier Database. This article of Holden and Gershkovich are seen to have made a case for a tax policy that would initiate a tax on oil anytime the market price falls below a predetermined threshold. The mechanism used here states a theory that can be used to keep oil prices at a sufficient level that stimulates the need to invest in different option for energy sources. This article is applicable to this topic since oil is the greatest source of energy that is used in the whole world. Many countries of the world are experiencing a drastic rise in the oil prices. This has brought many problems for industries to cope with losses that are brought by the presence of increase in oil prices. Coons, R. (2008), Alternative Fuels, Chemical Week, Academic Search Premier Database, 170(40), 20-21. The article written by Rebecca Coons describes the obstacles to alternative energy development presented by an economic downturn coupled with low oil prices. This book describes the reasons as to why oil prices are the main issue that affects many countries. It advances the need of having alternative sources of energy to using oil. However, there are many problems that countries experience an this hinders the possibility of having these alternative sources of energy. When the prices of oil are high, a country faces an economic down turn. Hence this article is highly related to the topic under discussion and gives good material for the argument for economic down turn. Coy, P. (2008), Cheaper gas, calmer debate. Business Week, Academic Search Premier Database. Mr. Coy who presents a correlation that exists between oil prices and public attention towards energy conservation writes this article. It is evident that, when there is an increase in oil prices, the public has to suffer in one way of the other. Many countries have to look for alternative ways of living to cope up with the increase in the oil prices. The article advocates of different ways in which the public can survive in a situation of an economic down turn. The publics sometimes are seen to cut their budget when spending to cater for the space created by the increase in oil prices. This article can be used in the arguments presented in the discussion to show the ways in which the publics of many countries can use to cope up with the economic down turn. Kieft, T., McCuddy, S., Onstott, T., Lin, D. M., Lin, L., Mislowack, B., et al. (2005), Geochemically Generated, Energy-Rich Substrates and Indigenous Microorganisms in Deep, Ancient Groundwater. Geomicrobiology Journal, 22(6), 325-335. This is a report which points to studies that indicates that the planetary biosphere extends to depths beyond 3 kilometers. This finding has got implications in the sense that there is a possibility of abiogenic energy sources that are exclusively geochemical and independent from photosynthesis. The report is applicable when discussing issues relating to economic down turn. It provides grounds for an argument that affirms Gold’s biotic oil theory that was argued by Dr. Thomas. Oil is seen as the main ting that many countries depend on in many activities. The effect of an oil price increase leads to the increase of prices of many products. This makes the life publics difficult to cope with. References Carey, J., Holden, D., & Gershkovich, T. (2008), The real question: should oil be cheap? Business Week, Academic Search Premier Database. Coons, R. (2008), Alternative Fuels, Chemical Week, Academic Search Premier Database, 170(40), 20-21. Coy, P. (2008), Cheaper gas, calmer debate. Business Week, Academic Search Premier Database. Deborah, H. C. (1997), Case Study-Introducing Business Risk Management, Global Council on Risk Management. General Motors Corporation George, L. (2008), Sustaining Non-profits during economic down turn, risk management institute. Grapperhaus, R. (1998), Measuring up: How risk managers apply the cost of risk survey results. Risk Management, New York, Vol. 45, pp. 27-29. Jones, A. S. (1991), Times to Lay Off 61 Employees; Poor Economic Conditions, New York Times Kieft, T., McCuddy, S., Onstott, T., Lin, D. M., Lin, L., Mislowack, B., et al. (2005), Geochemically Generated, Energy-Rich Substrates and Indigenous Microorganisms in Deep, Ancient Groundwater. Geomicrobiology Journal, 22(6), 325-335. Lam, J. C. and Kawamoto, B. M. (1997), Emergence of the Chief Risk Officer. Risk Management, pp. 30-35. Stack, M. K., (2009), PM PDT, Los Angeles. Read More