Even in good times it requires a lot of effort to be a really great people manager.
However - good times usually mean growth and profitability, which afford managers the opportunity to reward their people. Reward through cold, hard cash - bonus and raises - but also good times allow managers to show employees’ career development as the organization grows.
In tough times managers need to go back to fundamentals.
First - be a great communicator. During tough times be as transparent as possible with the state of the business and roles and responsibilities in the organization. This is especially important if tough times for your company involve a lay-off. Often I have seen where so much focus has been put on preparing for and executing the layoff that the management team has forgotten the "survivors". After a layoff if you are not communicating, then your staff is going to waste a lot of time wondering what their role is in the new organization and whether they have a future.
Second - seek for improvement opportunities in tough times. When things slow down it can actually be a good opportunity to re-engineer processes that are impacting productivity or employee satisfaction. That way, when things ramp up again, you will be ready for it.
Third - focus on employee development. When things slow down, look for opportunities to develop skills which are missing in your team. It is an investment in your future, but also is a reward outside the cash and promotions which employees really do value.
Finally, there is an old and over-used cliché which goes "when the going gets tough, the tough get going". During tough times, really focus on momentum. Ask yourself - what can you do to keep the "get going" in your team?