A layoff is often a first response to declining sales. It's also one of the hardest because it disappoints people who depended on you and can demoralize those who remain. When you face layoffs or rumors of layoffs, talk to people and reassure them. "You need presence so that people have faith in you," says Kinnear.
What shouldn't you say? "It's easy during a recession to point your finger at others," Hoffman says. "But strong leadership says all fingers point one way." Accept all responsibility and distribute credit generously.
If you're aggressive, tough times can be the best for hiring good people and developing current employees. "There are more good resumes on the street right now than I've seen in at least a decade," says Kinnear. Lok says his employees are less demanding when it comes to perks and pay hikes, too. Gauger believes now is a good time to spend money on training. "People are not as likely to jump ship," he notes. "You have an opportunity to build on a stronger level of loyalty."