You will have a chance to move your business forward as economies start to reopen, but you need to have people who can help you recover. Let’s take a look at how you can try to keep your employees.

The main point here is that you should try to avoid retrenchments and hold onto your people. This is proving to be a real challenge for a lot of companies, so let’s take a moment to consider why it’s so important.

When you lay off employees, you are losing valuable institutional knowledge. It’s not just a matter of their skills, it’s also their understanding of your company and your market and their networks that you are losing. If you cut people now, and then try to hire new people later as you recover, you are going to have a less capable workforce, and recovery will be harder.

Those new employees may also have less loyalty to you, since you have shown that you are willing to cut people for a short-term gain. That reduced loyalty leads to lower engagement and lower performance. That’s pretty much the opposite of the intense effort you’ll need from them to get your company back on track.

Consider this example: a small consulting firm in the oil & gas industry in Singapore recently cut part of its workforce. On one team of 8 people, they cut 5. Now, the oil & gas sector has had some extra challenges this spring, so you might think it makes sense to let people go. But how do they recover when things improve if they have less than half the people they did before? Who’s doing the work? Where’s the expertise? If you think they’ll just hire more people, consider the damage they have done to their employment brand; high performers may hesitate to join a company that is so willing to cut people.

Also, you may not be able to find the right people to hire. While you may think unemployment is going to rise and there will be plenty of people looking for work, a report in the Business Times in Singapore shared that tech talent remains in high demand now, so depending on what kinds of employees you think you’ll find later, they may not be available.

You might reach a point, of course, where the only way you can stay in business is to cut people. If you are at that point, then you need to do what you need to do. But you should let that be your last resort. You need to take a long-term view here.

Try instead to reduce the costs of your workforce. Your employees would rather stay employed with a 4-day workweek and a 20% pay cut, or reduced benefits.

With that last point in mind, be ready to restore benefits. During the Great Recession, many companies asked their employees to make a temporary sacrifice. Unfortunately, as things improved, a lot of those companies forgot about reinstating pay and benefits that people thought they were giving up temporarily. You will lose people in the recovery if you do that.

In order to recover, you need to take a long-term view about your business. Your people are the key to your recovery, so think about how to keep them. You may find that layoffs are necessary, but let that be your final option.