Boosting morale: just because times are tough doesn't mean the workplace has to be glum. (Management Advice).

A sluggish economy has thrown many companies into survival mode. Reports of sweeping cutbacks, hiring freezes, and downsizing abound. And while they may be necessary, such actions have weakened employee morale.

A recent survey from American Express Incentive Services (AEIS) of St. Louis, Missouri, revealed that most U.S. workers don't expect a stable economy for 2002. And after surviving the job cuts of 2001, 83% of respondents said they did not make any New Year's resolutions related to their current jobs.

But if their company sponsored an ongoing incentive program, 68% of those polled said they'd be "very likely" or "somewhat likely" to set, and work toward, job-related goals.

"American workers were battered by the 2001 economic downturn, and they're unmotivated and skittish about 2002," says Darryl Hutson, AEIS' CEO. "Now that the workforce has shrunk employers will need to focus their efforts on keeping their smaller, harder working groups of employees motivated."

If morale at your company is low, try these steps to get it fired up again:

* Play Up Your Company's Strengths. Ron Mays, president of Montgomery Jet Center, an aircraft sales and management firm, in Montgomery, Alabama, says his 17-employee team is kept abreast of the company's progress. "Once they see the viability of the company, they realize what a great place this is to work and forget about their concerns over losing their jobs or getting furloughed, as they would with the big airlines," says Mays, whose clients include entertainers, politicians, and clergy members.

* Focus on Productivity. During times of business uncertainty, the rumor mill turns faster than ever, often resulting in lower employee productivity. Daphne Moses Houston, president of SEE Solutions, a Dallas-based consulting firm, says small businesses can head off rumors by "over-communicating" the company's vision, sales volume, and financial stability to employees. In turn, company executives should ask employees for honest feedback regarding their jobs and take their responses to heart.

* Reassess Compensation and Benefit Plans. At The Wright Solutions Inc., a Lanham, Maryland, provider of management consulting and information technology services to the federal government and government contractors, co-owners Calvert and Lee Wright continually review compensation and benefits plans for their 11 employees. Recently, the pair negotiated a 15% company discount from Avis car rental for employees, moved to a better health insurance plan that offered a wider network of doctors at a lower rate, and upgraded their company-provided long-term disability and life insurance policies.

"We feel that if employees see us working to improve their benefit structure, they'll realize that we're not going to fold up and that we're going ahead with business as usual," says Lee Wright.

* Ask Employees for Help. Now is the time to ask staff members for their ideas, says Joyce L. Gioia, president of The Herman Group in Greensboro, North Carolina, and co-author of How To Become an Employer of Choice (Oakhill Press, $30). "Ask them if they have ideas on how to save money, or streamline processes and system," says Gioia. "We'll soon see people changing jobs at an unprecedented rate, so now is the right time to show your employees how much you appreciate them."

* Make Time for Fun. Your sales figures may be off for the year, but that doesn't mean you can't have some fun with your team. Schedule an outside activity such as bowling, miniature golf, or a spring picnic, Gioia says. Let the employees pick the activity and plan the event, then watch as friendships develop and goodwill prevails. "A day of fun will result in shared memories," says Gioia. "Such memories provide a wonderful foundation for stronger relationships."