Recession? What recession? Let's party!

Party on, colleagues.

Though the economic downturn has caused many companies to scrap their annual holiday parties this year, there are plenty that will pop some corks and a few that hope to make this year's bashes better than ever.

Big bash: Mechanical bulls, samba dancers

"Everyone always wants to have the best," said Erica Maurer, an event planner at EMRG Media in New York City. "If you can pay for it, you're going to try to get it."

Still rockin' around the Christmas tree

Some people may cringe at the idea of celebrating in this economic environment, but one expert suggests it's a good idea to get co-workers together, recession or no recession.

"These year-end celebrations are an effective way of boosting employee morale, especially in tough economic times," said John Challenger, the president of outplacement company Challenger, Gray & Christmas.

Caviar taste, hamburger budget?

Yahoo's (YHOO, news, msgs) Sunnyvale, Calif., employees will celebrate despite recent announcements that the company will slash 1,500 jobs and that founder Jerry Yang will step down as chief executive officer.

"To ensure the best possible rates, the venue was booked and paid for months ago, so the savings would be minimal if we were to cancel at this date," Yahoo spokeswoman Kim Rubey told CNN. "We also feel it is very important to show appreciation to our employees, who have worked extremely hard and who have made incredible progress during a challenging year."

It might be hard to come up with toasts. Yahoo's market capitalization has shrunk to about $13 billion from about $38.4 billion over the past six months, and the stock has fallen 64% over the past year.

What gets cut first?

Tough times have put a damper on the holiday spirit in the financial sector, but there are plenty of companies going ahead with their parties, including Knight Capital Group (NITE, news, msgs) and a number of hedge funds. Knight's party will be for employees only at the Lighthouse at Chelsea Piers in New York.

We crashed a holiday party that made all hints of a recession quickly fade away. The information technology company for the financial services industry wasn't any cutting corners: It had samba dancers, a celebrity DJ and, despite the bear market, a mechanical bull.

Required to party

Some companies will party because they have to: They've been locked in on the arrangements for months.

Tell us: Is your company throwing a holiday party -- or were you Scrooged?

The partying is still going strong at one of New York's most glamorous venues, the Rainbow Room.

"The economic downturn hasn't hit us so badly so far," said Stefania Gironbelli, the director of communications for Cipriani, which owns the Rainbow Room.

Here's some proof: The Rainbow Room has 75 events booked for December.

People book many months in advance for holiday parties, Gironbelli said. "We had a few cancellations, but it's not really a big number, and we still have a lot of financial companies booking."

Prices for events at the Rainbow Room vary, depending on whether it's a sit-down dinner or heavy hors d'oeuvres, and on how many people are attending, but the discussion starts around $200 a person, Gironbelli said.

Commitments to venues such as the Rainbow Room tend to be unforgiving. Where companies have signed contracts, they can either go ahead and celebrate or stay late at the office and pay the tab anyway.

BYOB to the office party?

Some companies are planning to go ahead and party, but to cut costs.

Challenger, Gray & Christmas' annual holiday survey of about 100 companies indicated that 13% of respondents plan to reduce party spending, with budget cuts averaging about 53%. Only 4.3% of companies are increasing their party budgets this year, while 83% plan to spend the same amount of money as last year, according to the survey.

"Many companies will find that holding a more low-key or low-budget party is better than canceling the party entirely," John Challenger suggested.

Maurer, of EMRG Media, explained how companies are cutting back.

"We've seen a downward trend," she said. "Instead of it being a four-hour top-shelf open bar, companies will do it for two hours."

In recent years, Google (GOOG, news, msgs) has set the standard for extravagance in holiday blowout bashes. Last year, about 10,000 people attended the company's party at the Shoreline Amphitheater, near Google headquarters in Mountain View, Calif. This year the company is part of the trend toward more-economical celebrations.

The company will host smaller, more-team-focused parties within its departments, including volunteer activities, museum visits and smaller dinner parties, a company spokeswoman said.

Google shares are down nearly 58% over the past year.

Some companies are giving the money they would have spent on a party to charity.

Accounting giant PricewaterhouseCoopers canceled all holiday parties and is instead giving $1.5 million to needy charities across the country. It is also encouraging employees to put in company-paid community-service hours over the holiday season, a spokesman said.

Morgan Stanley (MS, news, msgs) has canceled in favor of a donation, too.

Estée Lauder (EL, news, msgs) scrapped its annual party for the media in New York and instead will send a donation to the nonprofit Dress for Success, an organization that helps young women with their careers.

"After much thought and consideration, we have decided that, at this moment in time, it is more appropriate to thank you and celebrate in another way," the company said in a statement.

One popular cost-cutting measure is the elimination of free booze. About 71% of the company parties will have open bars this year, down from 90% in 2000, according to a survey from executive search firm Battalia Winston International.

Ho, ho, no more parties

Overall, it's not a great year to celebrate.

Company-sponsored holiday celebrations will hit a 20-year low in 2008, according to Battalia Winston. In its survey of 108 companies, 81% of the respondents said they will host parties this year, down from 85% in 2007.

"Over the past 20 years, the number of holiday parties has always mirrored the health of the economy," said Dale Winston, Battalia Winston's CEO, in a news release. "This year, the holiday mood is somber as concern about the economy continues to impact companies and their employees -- so much so that the number of parties has reached a historical low."

As bad years go, this one is worse. Fewer companies will throw parties than in the down days of 2001, when 83% of companies hosted holiday parties. During a recession in 1991, 82% had parties.

In good years, like 2006, 95% of companies threw holiday parties.

Challenger, Gray & Christmas said only 77% of surveyed companies are hosting parties this year, compared with last year, when 90% of companies threw holiday celebrations.

Here are some other ideas:

Viacom (VIA, news, msgs) canceled its holiday party and instead gave employees extra days off. Employees will get Dec. 22 and Jan. 1 as extra vacation days.

Viacom shares have tanked 65% over the past year.

Walt Disney's (DIS, news, msgs) ABC News canceled its parties in New York, Los Angeles and Washington, D.C.

"We report every day on the economic climate and the effects being felt throughout the country. We are not immune from the downturn," ABC News President David Westin said in an e-mail to employees.

Disney stock has lost more than 33% of its value over the past year.

MediaBistro, a Web site for media professionals, invited workers whose parties had been canceled to commiserate together at an event last week. And Kahlua, a coffee liqueur maker, even offered $10,000 grants to five small businesses to let their previously canceled bashes live on. The winners were chosen Dec. 12.

And of course, it's no surprise that many of the big financial companies are not celebrating this year.

American Express (AXP, news, msgs), UBS' (UBS, news, msgs) Wealth Management division and Barclays (BCS, news, msgs) have all ixnayed parties amid the market turmoil.

Fashion designer Marc Jacobs axed his "Rock and Roll Circus"-themed holiday gala, which was to have been held at the Rainbow Room.

"Due to the financial climate, I had to make the decision to cancel the 2008 holiday party," Jacobs' business partner, Robert Duffy, wrote in an e-mail to employees. "Hopefully it will be reinstated next year."

Here's to a happy new year.

Produced by Darragh Worland

Published Dec. 16, 2008