Small business owners should hold off making redundancies if they want to remain efficient and able to cope with the economic downturn.

That's the view of HR consultancy Willerby Hill, which claims that staff expertise and skills are most needed during a downturn.

"Apart from depriving yourself of prized assets that may be vital to weather hard times, you could be delivering competitive advantage to business rivals by letting go high calibre players whose training and development you financed," said Rob Coates, managing director.

"The fact is that, whatever the short to medium-term trends, the UK workforce is ageing and shrinking rapidly, with decent staff increasingly aware of their value and far more ambitious.

"As such, the employment market is more predatory than ever before and businesses should be positioning themselves as top employers in their sector and geographic area so that they attract and retain the best workers."

If there is no alternative to making staff redundant, Hull-based Willerby Hill recommends employers adhere to the following tips:

• Have a strategy of complete honesty and openness
• Communicate with everyone: not just those affected, but those left in post
• Always ensure that when questioned you can justify your rationale
• Talk to a HR expert and develop a well planned process for before during and after any action has taken place
• Make sure that headcount changes will actually achieve the financial savings needed to avoid repeating the exercise
• Consider redundancy as a last, not first, resort
• Ensure that managers have the skills, training and support needed to manage the process sensitively and efficiently
• Build plans to ensure the long-term of the team
• View redundancy as a process for redesigning how things can be done better, not just ‘chopping away' a cost
• Don't avoid difficult conversations with your people; they have fears, concerns and questions that must be addressed