If you've budgeted for and are still planning on bringing your people together in December or January for an annual holiday event, you are in the majority.  However, that majority is shrinking due to the struggling economy.

As CNNMoney.com noted yesterday, a survey of over 100 companies by executive search firm Battalia Winston Amrop found that 81% of them plan to host parties this year.  This is down 4% from 2007, and is even lower than in 2001 – after 9/11 – and during the recession of 1991.

Not surprisingly, those organizations that do plan to host parties this year are trying to find ways to cut the associated costs.  In their just-released "pulse" survey of over 450 companies in the last month, global professional services firm Towers Perrin found that more than half (58%) say they are "somewhat or very likely to scale back this year's holiday party and other employee events to save money."

Before you jump on the bandwagon of the 19% of businesses that won't host parties this year, take a step back and think about how that would impact your employee engagement activities and workplace team building.  Do you host other all-employee events throughout the year?  If the answer is no, it may be vital to the camaraderie of your staff for you to bite the bullet and host a holiday party again this year.

Yet, as with employee recognition generally, you can find ways to do it "on the cheap," as they say.  Here are 12 ideas to get you there (courtesy of the Associated Press, Funny Employee Awards, U.S. News and World Report, and The Canadian Press):

1. If you were budgeting for an off-site event, hold it on site and donate some of the remaining funds to charity(ies).  If you donate to more than one, survey your employees informally to see which ones they would prefer.  Hold on to the rest of the funds in your budget.
2. Do your suppliers or vendors provide anything your employees would want as gifts?  If so, contact them to see if they would offer your staff discounts or freebies on their products, and distribute them at your party.
3. Save money and reduce the possibility for a workplace-related accident: cut the booze from the budget.  Or, if the party is off site, make it a cash bar.
4. Make the party potluck instead of catered.  This offers the benefit of getting employees to share their recipes with one another, fostering open communication.
5. If you decide to have your party be catered, do some research – perhaps call some of your suppliers – and look for catering companies or hotels that are offering great deals to fill up their bookings.
6. Appreciated almost more than a staff party these days is paid time off.  If your people aren't that excited for a holiday get-together, they will be for that – and you don't incur any additional costs.
7. At your party, in lieu of traditional gifts, create funny or personalized (or both!) awards.  This book by comedian Larry Weaver, which includes sample award templates, offers a starting place.
8. If your workplace has done a "secret Santa" in the past, consider reducing the amount employees spend on one another this year.
9. If you practice open book management, or otherwise communicate most of the key financials to your employees, they will know if you're having a down year.  If this is the case, it will be that much easier to tell them frankly that you have less to spend this year on a holiday event.  You might, then, encourage them to create a committee to brainstorm, create, and execute their own event that's highly tailored to your culture.  You still get the morale boost – and increased productivity that can result – out of the deal.
10. On the subject of holiday party committees, you stretch your dollars further by having them create do-it-yourself gifts such as mix CDs or photo albums.
11. If your party will be on site or otherwise cost-slashed, you may consider taking part of the budget and giving it to employees to help with their holiday expenses.
12. Finally, for those who still plan to host an event off site, a twofer: Hire a planner who is tasked with cutting costs, and then schedule your event for January, when the holiday rush is over, enabling your planner to better negotiate rates.

Are you already using one or more of these ideas?  Do you have others you are using and would recommend that are not on this list?  How do they fit in with your overall employee engagement best practices?  I'd love to hear your stories.