5 Recession-Proof Industries in 2023

Industries that see fewer losses or even greater gains when the economy sours are overall recession-proof or recession-resistant. Let’s figure out which fields can remain stable even in economic crisis and the advice for CXOs of businesses.?

1. World economy in flux before the edge of the 2023 recession

The DC WorldBank declared in June that the world is approaching a lengthy phase of weak growth and high inflation. Some experts from World Bank also hold expectations that there is a total economic growth through 2022 to hit 0.1%, with this sliding to -0.4% throughout 2023.?

The reasons analyzed are the impacts of the Covid-19 pandemic’s aftershock and Russia’s invasion of Ukraine. In particular, in energy-importing nations, higher energy prices will reduce real incomes, increase production costs, tighten financial conditions, and limit macroeconomic policy. The Covid-19 Pandemic is not the end of the world. Another crisis is on the way to shed a shadow on the world.

2. Industries during economic instability

In the economic fluctuations, let’s find out how industries react to market changes.?

Travel

According to November 2022 data from the study, 92% of Americans have travel plans for the next six months, which is a tie for the highest level of travel seen since the beginning of the pandemic. The travel industry is still forecasted to receive positive recovery after Covid-19.?

Based on the forecast in the report by the UN Tourism , travel in Asia-Pacific is expected to rocket in 2023 and be followed by 2024. Overall, 50% of travelers from Singapore, Malaysia, Indonesia, and the Philippines intend to travel in 2023. 68% of Singaporeans surveyed said they are ready to travel in 2023.

@TheEconomist 2022 predicts that air travel turns profitable as international arrivals soar by 30%. But they stay below pre-pandemic levels; many would-be business travelers opt to meet remotely instead.

The reason why many economic experts still hold confident predictions about the travel industry is because of the change in customer insight. Customers now have some changes in their options to deal with the economic crisis. A recent survey conducted by Seven Corners Travel Insurance found that most travelers (57%) preferred to alter their vacation plans rather than cancel them because of any reason. Shorter Stays, Off-Season Travel or Budget-friendly destinations will be the more economical choices for travelers. The travel demand always exists.?

Food service and Restaurant industry

Food service operators will feel a stinging financial pinch given that most currently problematic costs will remain problematic into 2023. But, at the same time, the industry is forecasted to grow in real terms in both 2022 and 2023.?

Ultimately, the consumer determines food service industry performance. Over the foreseeable future, it is highly likely that consumers will feel greater economic pressures due to higher prices, rising interest rates, energy costs, a depressed stock market, and durable goods shortages. However, consumer food service behavior may not change dramatically compared to behavior during previous recessions.?

At present, consumers report that, while they have reduced their use of food service visit frequency from the highs of summer 2021, they continue to spend when they do eat out. Although occasions are down, consumers choose not to deny themselves restaurant experiences and satisfy their cravings.?

The chart has shown that the potential of foodservice and restaurant industry. The rate gradually increases yearly during the period of from 2005 to 2027, except for 2 years of Pandemic lockdown. The rate indicates little and stable increase in revenue from restaurant each year.?

Healthcare industry

According to OECD - OCDE 2022 analyst, the public plans to maintain or increase spending in order to tackle a backlog of non-Covid care. It is expected that total healthcare spending (public and private combined) to rise by 4.9% in nominal US-dollar terms in 2023. There will be pockets of strong growth in the healthcare sector, particularly in the Gulf countries, which are benefiting from high oil prices.

The chart illustrates that the spending on healthcare reaches its peak in 2021 because everyone pours money on medical services during Covid-19 and then sharply decreases in 2022 when the pandemic seems to stabilize and increases gradually in 2023.?

According to Forbes 2022, Healthcare is a good choice if you want to find an industry to invest in in 2023. Healthcare will always be a priority because we cannot ignore the realities of falling ill, and we’ll always have to take care of ourselves and our loved ones. People will see doctors and purchase basic medications regardless of a recession. Healthcare ranges from medical services to essential over-the-counter products you pick up at your local pharmacy.

There is a constant rise in Pharmacy sales in all regions of the world in 2023, showing the potential growth of this industry.?

Technology industry

Gartner predicted in July 2022 that global IT spending would increase by 3% to $4.5 trillion. Although the rate of expansion is moderating, the market is still robust. Spending on hardware was down by 5%, whereas spending on software and IT services increased by 9.6% and 6.2%, respectively.

The vice president of research at Gartner, John-David Lovelock, stated that for businesses and organizations to remain competitive, they needed to invest in technology and that is reason why technology can be consider as a rising star no matter how tough the recession will be.?

According to The Economist 2022, recession risks and rate increases do not prevent software spending from rising by almost 12% in 2023. Recession risks and interest-rate hikes will not deter its spending in 2023. Companies will increasingly tap technology to predict demand, track supply, and secure data. Gartner , a consultancy, expects tech spending to rise by more than 6% from the year before, propelled by firms’ need for software and its services.

Communication service industry

The communication services sector is a broad one. It includes telecommunication companies, social media and internet search companies, streamers, and video game makers. Some of its biggest names on social media services are Facebook’s Meta , 谷歌 's parent Alphabet, Verizon , and Netflix . dentsu , an advertising giant, expects global advertising revenues to grow by more than 5% in 2023, to almost $780bn.?

The growth of communication or social media cannot be limited in recession because the connection between people is stronger than ever in this flat world.?

3. Technology Outsourcing: A Cost-saving tactic for market leaders during recession

Though being recession-proof industries, the business will face up to the press of the overall market. Those above predictions cannot be assured 100% and no one can tell what happens, especially with the worst scenario, “stagflation” (stagnation and inflation occur at the same time).?

To prepare for any situation, companies of all industries are recommended to find strategies to cut down unnecessary expenditures. With a technology future in the world, all fields are shifting to applying savvy technology via hiring technology outsourcing teams to save personnel costs, a better approach to customers, and give out a more competitive price for products. With the same performance quality, the outsourcing team can charge your business at a cheaper price, which can save a large amount of money.?

With the upward trend in technology spending, IT outsourcing spending is expected to exceed $1.3 trillion by the end of 2023. Hiring offshore developers is one of the best options for SMEs to shorten the development timeline and access to IT talent pool at a reasonable price. The capital of the outsourcing world is now located in some outstanding countries such as India, China, or Vietnam with better and better conditions of collaboration.?

The technology wave in business operations is more vibrant than ever for its cost-saving?benefits for companies, especially the upcoming 2023 recession. Do not be out of this trend and prepared for your entrepreneurs with savvy technology approach at a budget-friendly price through IT outsourcing.?

Wrap-up

Being an expert in Travel, Food & Beverage, Healthcare, and Social Media fields, we, Adamo Software have helped out clients around the world with mobile app and website development projects. We proudly witness the revenue growth of our customer's thanks to our technological participation. If you want to search for a trusted technology outsourcing partner, we are willing for a free consultation.

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