Recession ahead? How to cope....

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Eurofan

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A great deal of subject mater in 'Great Financial Debates' seems very pessimistic on the potential future of the Celtic Tiger for a wealth of various and intertwined reasons from property bubbles to reliance on the construction sector, exports controled by foreign owned multinationals etc. etc.

For the purposes of this debate lets assume there's trouble ahead. How do you cope with it?

Other than the obvious things like paying down as much debt as possible now what would those who may have been through a recession before recommend? What kind of careers survive recessions? (other than public servants).

Would it be possible to make a good set of decisions now and not only survive a recession but be in a situation to thrive?
 
Eurofan said:
A great deal of subject mater in 'Great Financial Debates' seems very pessimistic on the potential future of the Celtic Tiger for a wealth of various and intertwined reasons from property bubbles to reliance on the construction sector, exports controled by foreign owned multinationals etc. etc.

For the purposes of this debate lets assume there's trouble ahead. How do you cope with it?

Other than the obvious things like paying down as much debt as possible now what would those who may have been through a recession before recommend? What kind of careers survive recessions? (other than public servants).

Would it be possible to make a good set of decisions now and not only survive a recession but be in a situation to thrive?
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Take time out of the rat race, smell the roses?
Option 1: Recessions are good times to go back to/stay longer in school.

Option 2: take that long round the world trip you always wanted-- it'll be a whole lot cheaper. Then maybe start Option 1.
 
Don't put all your eggs in one basket either. Lots of people are invested in Irish property alone. Spread your risk.
Though joining the public service just in time would be a handy way out!
 
Advertising and marketing guys are often the first to be dropped if things start to look hairy so if you're involved in that field it might be worth diversifying a bit.
The repossession business might have a bright future ;)

I'd second walk2dewater advice on going back to college. Investing in yourself this way will probably give you a much greater return than is otherwise possible during a downturn.
 
Afuera said:
The repossession business might have a bright future ;)
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To quote the simpsons.. "..but it's a golden age for the repo-business.. one which will never end.."

Tells you everthing you need you know about human psychology during a boom :D
 
Well having done the redundancy thing twice due to jobs being shipped off to cheaper markets...
If you work for a big multi national take a look at the new improved factory / plant / site they are developing in outer mongolia, and consider if your job could be outsourced... Chances are that a lot of peoples roles are not linked to geographical location, so if they can get a body in a seat for 1/3 of the cost of you... you're potential cannon fodder for the profit margin!
Look around at what roles within your organisation aren't mobile - usually the sales guys can be hit but some are still needed to generate the cash flow the company needs. If there is research and development in your orgnaisation, can you get in there, they will be trying to generate the 'next big thing' so R&D can be impacted, but again its where they hope next years dosh will come from.
Try and get on all the training course that are being run, get up to speed on the current 'hot topics' in your industry, you want to talk todays talk if you need to go interviewing, not last years speak!
Start battoning down the hatches now, you need to get a firm grip of your finances, forget the '06 car, the exotic holidays, the new house / extension.... divert any spare cash into either paying off debts (unsecured like loans, credit card should be no 1 to clear), build up a contingency fund, be it x times your monthly take home, or a defined amount EU15-20k, easily accessible.

Then stand as a TD and using your political clout to employ everyone you ever knew in the civil servce..... Ok the last one was probably not a go-er... but in recession you need to think outside the box!!!
 
Interesting advice so far and thanks to those who've contributed.

Funnily enough i'm back in college full-time myself as a mature student and will be for potentially the next 3 years or so (depending on if i pursue the masters or not).

I sold my house last year and we are completely debt free with a six figure sum earning a little interest with Rabodirect though i'm considering diverting some of that to gold.

My better half is 7 years with a semi-state and staying there at least until i finish college.

We're renting a nice house at a good rate (the landlord is family so security of tenancy too).

So if the worst happens we seem to be in good shape so far?

Interesting to note potential careers that would survive/thrive a recession. In another article (have lost the reference though sorry) there was a sad reflection that the alcohol trade always does exceptionally well during tough economic times. Any other careers/trades that would do well?
 
Thats brilliant.

Economists take note - the best barometer for the performance of an economy is not the rate of construction projects but the volume of lipstick sales.

Eurofan, I think careers in areas that supply basic human needs is where to look-
- food + Drink (not restaurants etc. but basic food)
- communications, mobile telephony (people will always need to communicate no matter what the economic climate)
- Transport (commuter transport not holiday transport)
- Law

I think industries like Motoring, Designer Clothes,advertising + marketting, restaurants,airlines+travel, electronic goods are ones that take a hit.
 
if there is a serious recession, does anyone fear violence. What Im saying is does anyone fear that people who did well out of the celtic tiger and preserved their wealth might be targeted by people that got burned by it. The reason why I am asking this is that the celtic tiger has been a relatively recent phenomenon and people that started out at the same level 10 years ago maybe at very different levels today. It wasnt a slow process like before where people would have accepted how the person generated their wealth.
 
No but i could see the youth of Ireland bailing out of here on an unprecedented scale. Options throughout the EU are plentiful and much better than the UK/US options of old.

Myself and some friends talked about this some time ago (all related to property prices of course) and to my surprise the general consensous was that if they genuinely found themselves in difficulty (i.e. negative equity, perhaps down one job, good times long gone) at least half of them would give serious thought to chucking the keys back to the bank and getting on the first plane out of here.

The late twenties and thirtysomethings in Ireland today have undertaken astonishing amounts of debt and rely totally on steady wage inflation and a booming economy.
 
How to cope? i think its going to be harder for the generation coming up who maybe have never lacked material possessions. Saw in the local paper about one set of parents hiring a horse and carriage for their daughter's communion!!! Best way to cope with a recession is to have been brought up in the late seventies/ early eighties or earlier where you wore hand-me-down clothes, bought a bike with you communion money and cycled everywhere, were delighted to get a rubbish paying part-time job etc. To really long for an item of clothing, music tape etc and have to save for it..... i could go on.

I'm not saying want to go back to that just that life for younger people is much more revolved around money. Take it away and it may be hard for them to adjust not just to watching purse strings but to having an identity thats not based on what they have or haven't got materially.
 
Eurofan said:
What kind of careers survive recessions? (other than public servants).
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I work for a subsidary of a German conglomerate that specialises in outsourced business/IT services. I've noticed in a few dinners lately that the heads of lines of service are rubbing their hands together with glee at any indication of a turndown, as a recession generates (apparently) a lot of business for outsourcing.

Contrary to popular opinion, there is still a hell of a lot of outsourcing done in the home country (or increasing in other EU countries). The new services directive will also effectively enable more public sector outsourcing to go outside the home country (also I note that in the UK/Ireland a lot of services are now considered to be independent agencies rather than state entities - eg Irish NCT, UK ONS - which has enabled outsourcing to non home countries in a few cases).
 
evan said:
if there is a serious recession, does anyone fear violence. What Im saying is does anyone fear that people who did well out of the celtic tiger and preserved their wealth might be targeted by people that got burned by it. The reason why I am asking this is that the celtic tiger has been a relatively recent phenomenon and people that started out at the same level 10 years ago maybe at very different levels today. It wasnt a slow process like before where people would have accepted how the person generated their wealth.
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Very interesting point - apparently one of the biggest growth industries in highly unequal countries are "gated" communities - I found a programme on the BBC website that explored this trend from both perspectives. What we could see is Johannesburg-like scenarios spreading worldwide . . .
 
"No but i could see the youth of Ireland bailing out of here on an unprecedented scale. Options throughout the EU are plentiful and much better than the UK/US options of old."

where are those plentiful options? in germany!! france!! poland !!, I don't see them. Any opportunities that crop up there will be swiped up by the more hungry multi lingual eastern europeans than by the mono lingual irish. Irish people always had a great advantage in britain and the US but they don't have that advantage in european countries especially now that it is open to the new EU countries. There may be opportunities to invest in businesses there but that hardly applies to someone who has no capital and has already defaulted on debt in another country.
 
evan said:
"No but i could see the youth of Ireland bailing out of here on an unprecedented scale. Options throughout the EU are plentiful and much better than the UK/US options of old."

where are those plentiful options? in germany!! france!! poland !!, I don't see them. Any opportunities that crop up there will be swiped up by the more hungry multi lingual eastern europeans than by the mono lingual irish. Irish people always had a great advantage in britain and the US but they don't have that advantage in european countries especially now that it is open to the new EU countries. There may be opportunities to invest in businesses there but that hardly applies to someone who has no capital and has already defaulted on debt in another country.
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Much international business is being conducted in English. I know of a Spanish company importing cars from Germany that uses English as the common language to negotiate things. Another Spanish friend used to have dealings in Tokyo and this again was all through English.
I would expect this to be quite common.

Also, there's nothing stopping the mono lingual Irish from becoming multi lingual Irish. It's not like it's a genetic condition or anything:D
 
I agree with Evan. Friends living in France and Germany report that it is very difficult to find work there, and their friends/family are in the same boat. One mate hates her job and has been looking to get out for three years, no luck yet and she has an excellent resume in the public and private sector, and would take absolutely anything at this point. Work is just so scarce. ANY work. It's depressing.

Personally I've never had a problem finding work in Ireland...I thank my lucky stars that I'm working here. I hate to say it but a lot of people in Ireland don't know how lucky they are...even if there might be a downturn in the future, we've had a good run. The grass isn't always greener.
 
A few industries that could benefit during a recession:
- Sales of baked beans, noodles, minced meat, and porridge
- Car repair (because people will be keeping the old car in order rather than trading in)
- Bicycle sales and repair
- Lagging jackets, timer switches, and other items that would decrease fuel and electricity wastage
- DVD rental (Hollywood did really well from the Great Depression when people wanted cheering up at a small cost)
- Caravan parks and other cheap-and-cheerful holidays (people will still want a break even if they can't afford 3 weeks in Thailand)
- Fads that are silly and amusing but low cost (see space hoppers, cabbage patch dolls, pet rocks, etc.) Hard to guess in advance what these will be tho!
- Dodgy fashions (see the '70s)
 
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