"Companies Pushing Workers Over the Limit"
All work and little play make Kate a resentful employee.
It also makes her an anxious, more mistake-prone worker. And as a human resources professional at a small marketing company, she sees other employees at her firm reaching their limits.
Kate, not her real name, estimates her workload has risen about 30 percent since the recession began in 2007 because the company has grown but avoided hiring more HR staffers. The heavier load, she says, has led to errors in her work and stressed out Kate to the point that she started seeing a counselor and taking anti-anxiety medication.
She's not the only one getting fed up with the firm's increased work expectations. Kate has seen higher absenteeism, more employees asking for referrals to counselors and rising turnover—it reached more than 30 percent in 2010.
"I hear people talking to each other," says Kate, who spoke with Workforce Management on condition of anonymity for fear of harming her relationship with her employer. "It is much more stressful than it was a few years ago."
Kate and her co-workers are living the quiet flip side of the jobless recovery. Call it the "work-more economy." Many workers are taking on extra responsibilities and in some cases doing two jobs for the price of one. While politicians and pundits fret about unemployment and underemployment rates, growing numbers of employees are under pressure to do more. And the situation threatens not just workers' sanity but companies' long-term success.
In particular, pressure-cooker work climates threaten long-term productivity, employee engagement, corporate reputation and talent retention.
The work intensification trend has much to do with companies trying to navigate an uncertain business environment. Employers are giving employees more duties to fill the void created by laid-off colleagues, hiring freezes and new business growth.
In some ways, asking more of the existing workforce makes sense. Companies are preserving cash to prepare for future economic shocks. Hiring more workers too soon risks future layoffs. And higher expectations on the job can be a good thing for both workers and companies.
But there's a tipping point. And the data—including Workforce Management's own survey research—indicate many firms are going too far with their demands.
In a survey of 600 U.S. workers that Workforce Management conducted with Workplace Options, a Raleigh, North Carolina-based provider of employee assistance program services, 55 percent of respondents said that their job responsibilities had increased as a result of the troubled economy. More than a quarter of workers (27 percent) said that their duties had doubled. Among those with extra work on their plate, 51 percent said the added duties have had a negative effect on their well-being.
The Workforce Management-Workplace Options survey, conducted in July, involved a random sample of working Americans from various industries, including retail, financial services, manufacturing and health care.
Companies are not eager to discuss the work-more economy publicly. Several major employers contacted by Workforce Management declined to be interviewed for this story.
There's some evidence that companies are starting to pay attention to the dangers of overworking employees. But many organizations, it seems, fail to recognize the risks. "Work-related stress" was the reason top-performing employees in the U.S. most frequently cited for why they would leave their organization, according to a recent report by consulting firm Towers Watson & Co. and professional association WorldatWork. However, when employers were asked about reasons high performers would jump ship, stress didn't even rank among their top five most frequent responses, according to The 2011/2012 Talent Management and Rewards Study, North America.
That disconnect helps explain why more organizations are struggling to hold on to key talent. The percentage of U.S. companies that are having difficulty retaining critical-skill employees has risen from 16 percent in 2009 to 31 percent in 2010 to 36 percent in 2011, according to Towers Watson's report.
High-potential employees also are itching to leave oppressive workplaces. In 2005, just 1 in 7 high-potential workers were looking for a new job, according to research from the Corporate Executive Board Co., an advisory firm. By 2011, the number had jumped to 1 in 4. Companies in recent years have heaped additional duties on their most promising employees without giving much in the way of support or extra rewards, says Brian Kropp, a managing director at the Corporate Executive Board. Future leaders will "take one for the team" once or twice, Kropp says, but they have their limits.
"There's only so many times you can do it before you're just tired and worn out," he says.
THE ECONOMIC EQUATION
"Preventing Employee Burnout: Customized Solutions"
The Great Recession of 2007-09 knocked the U.S., its companies and its workers for a loop. The economic rebound that officially began in 2009 has made the "jobless recoveries" after the recessions of 1990 and 2001 pale by comparison. Still, the recovery has meant better times for businesses.
Since the third quarter of 2009, the U.S. economy has been growing. What's more, corporate profits have been climbing. According to the U.S. Commerce Department, corporate profits rose roughly 30 percent in 2010 and continued climbing in the first three quarters of 2011—by some $40 billion in the third quarter alone.
All the revenue and profit growth is partly a function of higher productivity—better use of equipment, upgraded computer systems and improved business processes. But it also comes from squeezing more work out of workers.
Towers Watson's recent study of 316 North American companies found that nearly two-thirds of respondents have expected employees to work more hours than normal during the past three years. A majority sees this trend continuing for some time.
Human resources professionals in particular are feeling pressure to speed up and do more. Workforce Management recently surveyed 713 HR professionals on job intensification issues. Three out of four said that their workload had increased since the recession.
STORIES FROM THE TRENCHES
"Perhaps Your Workers Are Entitled to New Titles"
For Melvin Williams, vice president of human resources at Administrative Services Inc. in Bethesda, Maryland, working extra hours has become the norm as his department has shrunk from six to two people over the course of the year. ASI provides back-office business support to a number of state health and human services agencies.
Although the company's overall workforce dropped from 400 to 200 people, it still means extra time at the office.
"For the past eight months I've been putting in extremely long hours," says Williams, who responded to the Workforce Management poll of HR professionals. "I average 60 hours a week. Usually, I get in at 9:30 and leave at 8 or later."
Longer days and ratcheted-up duties can be positive. Many workers, having watched laid-off colleagues struggle to regain employment, are grateful they're busy. New duties also can expand worker skills and responsibilities in a way that fosters professional growth. In the Workforce Management-Workplace Options survey, of the employees who reported an increased workload, nearly a quarter said the change had improved their well-being.
But many workers do not welcome the work-more economy. For example, 55 percent of HR professionals handling extra work say it has harmed their quality of life.
Williams falls into that camp. The extra hours at work have caused tension at home. "It's blown the hell of out my relationship. My wife tells me, 'There's no time for us anymore. All you do is work,' " he says. "I tell my wife we have bills to pay."
Kate, the HR official at the marketing company, recently took her first vacation in more than two years. And it was hardly a getaway. "My boss said, 'You need to carry your phone,' " she says. Kate checked her work messages daily, something she resented having to do.
Her colleagues face similar pressures to extend work into personal time. Not long ago, Kate spotted a co-worker at the mall. The colleague was on the phone with a client who was yelling at her. "We have people working all weekend," Kate says. "So it's tough."
THE NEW (AB)NORMAL
"Worker ‘Gas Tanks' Close to Empty"
Worker stress reflects not only heavier demands in recent years, but the fears and difficulties of the Great Recession that preceded the recovery as well as ongoing economic uncertainty. In effect, employees have been under sometimes-severe strain for roughly four years.
Bigger workloads might be easier to shoulder if employees were getting raises, as well. But by and large they aren't. In the Workforce Management-Workplace Options survey, just 30 percent of those employees reporting an increase in job duties said they got a pay increase as well. And government data show that inflation-adjusted average hourly earnings fell 1.6 percent from October 2010 to October 2011.
Still, some observers say workers should get used to the present business as usual. Given doubts about the government's ability to reduce unemployment rates anytime soon, employers may be able to make always-on "superjobs" the standard rather than the exception.
Companies have seen a spurt in productivity, but it may not be a lasting one. Wayne Hochwarter, a management professor at Florida State University in Tallahassee, surveyed more than 700 full-time workers in 2011 and found that employees in a demanding work environment said their job performance had risen. But their anxiety levels at work and home also rose, while their job satisfaction fell.
Especially when increased demands come with factors like layoff fears and poor communication by the boss and company, heightened worker productivity is likely to be short-lived, Hochwarter says. "The toll on the human system leads to deteriorating performance and effort," he says. "The person is left with an empty tank."
"EAPs: First Responders in a ‘Work-More Economy' "
Hochwarter's point is echoed in a recent survey of about 1,000 employees by ComPsych, a provider of employee assistance program services. Almost 1 in 3 (29 percent) of employees come to work at least five days per year too stressed to be effective, up from 19 percent in 2010, according to the study, which polled mostly U.S. workers. Overall, 66 percent of workers surveyed reported sustained, high stress levels. Workload is the top cause of stress, ahead of both "people issues" and lack of job security, according to ComPsych.
Engagement—an employees' willingness to go the extra mile for their employer—also is at risk in more demanding workplaces. Most reports show a drop in engagement from before the Great Recession, including Workforce Management's recent survey of HR professionals. Of the respondents who said their organizations had increased workloads with a negative effect on employees, 80 percent saw a decline in employee engagement.
Perhaps not surprisingly, retaining employees is a growing challenge. An August survey of 631 U.S. employees found that 38 percent of U.S. workers are actively looking for a new job, up from 36 percent in January. The survey was commissioned by employee recognition software provider Globoforce.
Employees with the most potential are the most eager to escape their employers—and they are beginning to do so, says Kropp of the Corporate Executive Board. Promising employees often are given herculean tasks but not much help or extra pay.
"We tend to put them in the hardest jobs we have, and we tend not to support them," Kropp says. "In many ways we go too far."
Should the economy improve and job openings increase, key defections from firms that crack the whip too hard almost certainly will increase. Dean Debnam, CEO of Workplace Options, says employers must balance the need to run lean in these uncertain times with the need to prepare for future growth. "You've got to not 'eat your seed corn' by stressing out your staff so they're ready to leave," Debnam says.
The perils of overworked employees are starting to dawn on companies. In its Talent Management and Rewards Study, Towers Watson found that most U.S. companies are concerned about the long-term effect that changes they made to remain profitable are having on employee work-life balance. In addition, U.S. employers are more concerned today than they were in 2010 about the effect of organizational changes—such as staff cutbacks and increased workloads—on employees' productivity and willingness to take risks.
The HR professionals Workforce Management surveyed in September and October also revealed serious misgivings about more taxing workplaces. Eight in 10 said their organizations had increased job duties compared with before the recession, and more than half of those said that the heavier workloads are not sustainable in the long run.
MOVING PAST THE WORK-MORE ECONOMY
Some of the solutions to the stressed-out workforce are straightforward, though they come with costs.
The most obvious answer is hiring more people. Consider personal-care products-maker Seventh Generation Inc. Over the past few years, employees at the Burlington, Vermont, company have been under pressure in part because of strong business growth. In 2009, for example, the company's former CEO acknowledged that "our work/home balance is clearly out of whack."
But since then, Seventh Generation has increased its workforce by about 25 percent, to 115 employees. "The level of anxiety is clearly less because we have more help to bear the burdens," says John LeBourveau, Seventh Generation's vice president of human resources.
Perhaps not coincidentally, Seventh Generation's ranking on a list of the best employers in Vermont rose from fifth in 2010 to second in 2011.
Seventh Generation's sales fell slightly in 2009. Although LeBourveau declined to state financial results for the past two years in detail, he said sales have been growing consistently. Hiring has played a role. "The addition of new talent and capability was a big contributor to our company's success," LeBourveau says.
More companies may follow Seventh Generation's example in the months ahead. U.S. employers expect hiring to increase slightly in the first quarter of 2012, according to a study released in mid-December by employment services company ManpowerGroup.
Another response to an overburdened workforce is to turn to contingent staffing. That's been happening to some degree, as seen by more temporary help placements and growing staffing industry revenue. Temporary help services employment in the United States has risen from 1.8 million workers in November 2009 to 2.2 million a year later to 2.3 million in November 2011. Research firm Staffing Industry Analysts, a sister organization to Workforce Management, estimates U.S. staffing industry revenue growth of 10 percent in 2011 to $113 billion.
Giving workers something in return for above-and-beyond efforts also can help. To keep top performers engaged, Towers Watson officials call for customized rewards and recognition plans. Raises may be in the cards for workers next year. According to consulting firm the Hay Group, employers plan median pay increases of 3 percent in 2012. In addition, promotions to new posts can win over employees who've taken on extra duties and learned new skills.
One respondent to Workforce Management's poll of HR professionals suggested a comprehensive response to the work-more economy. "Restore pay increases, hire staff, be more prudent about cutting waste, establish action plans for engagement at all levels, increase recognition," the respondent said when asked what their employer should do in the near term about increased workloads. "Restore trust."
For Kate and her co-workers at the marketing firm, it may be too late to restore trust. The speed up and stress have proven to be too much. "I would like to leave," Kate says. "I think a lot of people are feeling that way."
Senior writer Rita Pyrillis contributed reporting to this story.
Ed Frauenheim is Workforce Management's senior editor. To comment, email email@example.com.