Warnings of the coming recession are mounting. Inflation continues to soar, causing chaos in the stock market as companies begin to prepare for layoffs and hiring freezes. But there are some industries that economists say are better suited to recessions than others.
The 4 most "recession-proof" industries to work in
The sudden change in the dynamics of the labour market – after months of strong growth with rising wages – has left many workers scratching their heads.
“The job outlook is going to get a lot worse in the next few months,” Laurence Ball, an economics professor at Johns Hopkins University, told CNBC Make It. The question: How much worse?
School and care remain safe
If you’re thinking of changing roles soon, you should know that while no job is completely recession-proof, some industries tend to fare worse than others during a downturn. During the Great Recession that lasted from 2007 to 2009, the construction and manufacturing sectors experienced significant declines in employment, according to data from the Bureau of Labor Statistics.
That’s because during an economic downturn, people limit their secondary spending and put major purchases, such as cars and renovations, on hold, says Karen Dynan, an economics professor at Harvard University and former chief economist at the US Treasury Department. She predicts that these industries will see similar patterns if a recession were to occur soon.
Ball and Dynan say the most “recession-proof” industries that offer strong job security during economic downturns are:
- Computers and Information Technology
The common thread between these industries, Ball explains, is that they are less sensitive to changes in interest rates, and that people depend on these services whether the economy is booming or withering.
Higher education credits are valuable
Although schools have struggled to recruit and retain staff after the pandemic, education can be a stable sector in difficult times, says Ball. He expects that there will be an increased demand for staff at colleges and universities if a recession hits, as people may see higher education as a way to gain new skills and improve their job prospects.
“People are more likely to go to college if the job market is bad”Says Laurence Ball
Whether you’re looking for a new job or not, Dynan stresses the importance of honing your professional skills so that you can become a more competitive and valuable employee.
Check which skills appear most often in the job ads you’re interested in and start practicing them, or ask your boss if your company offers any professional development courses or webinars.Proposes Karen Dynan
“There’s not much you can do beyond your normal duties,” she says. “But learning what skills employers are looking for, and learning how to perform those skills well, is your best insurance policy.”