Here’s Why Experts Consider Automation “Recession Proof”

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Anxiety about a coming recession is high for corporate leaders across the globe. According to the World Bank, as “central banks across the world simultaneously hike interest rates in response to inflation, the world may be edging toward a global recession in 2023.”

It’s understandable for leaders to be risk averse as they grapple with the prospect of slowing demand. Keeping a close eye on costs is necessary, and certain projects may have to be put on the backburner.

But recessions can also be a good time to look at your business with fresh eyes and see where efficiencies can be gained.

Many consider automation to be “recession proof,” since it allows companies to play offense and defense at the same time—they can save on costs by becoming more efficient in the short term, while strengthening a key digital capability for the future.

When implemented correctly, embracing automation during a recession can enable your company to do more with less, and emerge stronger than ever.

Why is automation considered “recession proof?”

When sales begin to slow, investing for the future is often the last thing on leaders’ minds. After all, shouldn’t companies be conservative during uncertain times?

Not necessarily.

Certain investments can provide immediate cost savings, while strengthening a company for the future. Technology consultancy Smartbridge said that robotic process automation (RPA) is “one of the technologies that’s seemingly un-impacted by ‘recession-like’ economic downturns,” since it increases the efficiency of the human workforce.

When times are tough, it’s human nature to become defensive and protect what you have. But, those that keep their focus on long-term growth and invest well through these periods tend to come out on top once the economy returns to expansion.

And there’s this advice from one of our own:

When companies experience a…financial recession—forward-thinking organizations see this free time as an opportunity to improve internal business processes. In the same way that many work-at-home employees suddenly had free time to clean closets and tick off their to-do lists this spring, smart companies are positioning themselves for success in the new normal.

Joe Edwards, Senior Product Marketing Manager, UiPath

Any kind of substantial investment during a slowdown can seem risky, but with so many long-term tailwinds behind automation, it’s one of the few that can make the cut.

Amid broad workforce shifts, doing more with less is imperative

Company leaders have struggled to keep up with all the workforce changes in the past several years. Between the Great Resignation, shift to remote work, and scarcity of tech talent, businesses have had to adapt to keep making progress toward their goals.

With a recession on the horizon, many are looking to slash costs to protect profitability. But those moves can backfire.

According to an analysis by Harvard Business Review, “most enterprises implement aggressive cost-reduction plans to survive a recession. But companies that attend to improving operational efficiency fare better than those that focus on reducing the number of employees.”

Rather than broad cost-cutting measures, companies should find ways to become more efficient. Investing in cutting-edge automation technology is a great way to do so, since it helps reduce operational expenditures while setting up longer term growth.

Businesses that do well in recession have leadership that holds steady to the path of long-term growth and profits and don’t hurry to downsize their workforces drastically. With automation and technologies like RPA, companies are able to perform better than their strictly defensive-minded competition by downsizing at a lower rate, improving efficiency of their operations, and setting the foundation to flourish in the post-recession economy to follow.


People are the lifeblood of companies, and those that think of employees as assets rather than costs tend to perform better in the long run. Enabling them to do more with less can help businesses save on costs during tough times without sacrificing future growth.

Benefits go beyond dollars and cents

It’s hard to find many investments that allow a company to play offense and defense at the same time. Automation is unique in that regard, but the benefits don’t end there.

Overlooked advantages include the ability to look at your business with fresh eyes, future proof your workforce, and enable your employees to take on more creative work.

We are hearing from our clients that RPA/digital workforce has some significant benefits for an economic downturn and many have little to do with the actual technology. The process to build a bot requires detailed process documentation that provides people a chance to examine ‘business as usual’ with a new set of eyes and eliminate waste in the process

Tim Kulp, Vice President of Innovation & Strategy, Mind Over Machines

To improve internal processes and remove inefficiencies, employee buy-in is required. But, workforce reductions can sap morale and harm performance. In fact, The Wall Street Journal interviewed economists and found that companies that conducted broad layoffs during a downturn “underperformed the market over a three-year period.”

A key reason for this underperformance is that remaining employees are often forced to take on more work. This tends to leave them feeling burnt out, undervalued, and unmotivated.

Automation does the opposite—employees are enabled to do more with less, and spend a smaller part of their workday on tedious tasks. Since they enjoy their jobs more and are gaining new skills, they’re more likely to stick around for the long haul and grow with the company.

Dupe Witherick, Head of Automation at J.P. Morgan, mentioned that the bank is “really keen to upskill people, train people, for me that’s what future proofing your workforce is all about.”

Cost savings, stronger digital capabilities, and a fresh look at your business are some of the biggest benefits of investing in automation during a recession. And it’s not just about investment and leadership during a recession. It’s critical to think holistically about leading through and beyond a recession. Stay tuned! We’ll have more on that topic.

Bobby Patrick headshot
Bobby Patrick

Chief Marketing Officer (CMO), UiPath

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