Charles Dickens once started a novel with the following words: "It was the best of times; it was the worst of times... it was the spring of hope; it was the winter of despair." He could have been describing today's economy.

Small firms, especially, struggle with changing market conditions. How about the local business that manufactures airplane parts? In an upbeat economy, inventory may be flying off the shelves. But if OPEC decides to raise oil prices or a significant segment of the public decides to avoid air travel, the firm's highly skilled machinists may find themselves in the unemployment line. Or take a small construction firm. Sales revenues can be influenced by a wide variety of conditions, including lumber prices, interest rates, and gyrations in the global economy.

Uncertain market conditions can affect the productivity of even the most stalwart and loyal employees. Workers who face indefinite futures may find it difficult to stay focused. A major challenge for managers, throughout the ups and downs of business cycles, is motivating employees and keeping them on track.

How do you ensure that your workforce remains productive and positive during these volatile times? It's a tall order — but not an impossible one. Here are three suggestions.

• Keep it real. Denying the problem won't make it go away. If your company is losing sales and your workers may face layoffs, don't pretend everything's just fine. Open the channels of communication even wider. Solicit solutions from your staff. Employees have a vested interest in keeping the company afloat. They'll often provide some of your best advice.
• Shift the focus. Pessimism breeds pessimism. To counter negativity, discuss new opportunities. Analyze businesses in your industry that are showing a profit, even in a down market. Shine the spotlight on them; then go and do likewise.
• Show appreciation. No one likes insincere kudos. But when the work or attitude of an employee deserves honest praise, don't pass up the opportunity. Let your workers know they're making a difference. Even if your firm can't offer cash incentives right now, let your best employees know that their efforts haven't gone unnoticed. If you can honestly do so, hold out hope for future rewards as market conditions improve.

To some of your staff, today's volatile market may seem like "the worst of times." Keep them motivated now, and "the best of times" may be just ahead.