Layoffs, underemployment and a still-meager safety net aren’t hurting only U.S. workers. The failure to provide much economic security for average Americans is likely to wound companies and the economy overall. It’s probably doing so already.
What I’m getting at is the way shell-shocked, struggling individuals may make less-than-optimal choices because they’ve become so risk averse. When people pick jobs out of fear or an obsession with financial safety, they often end up in positions where they don’t thrive. And by passing on a job that would have been a better fit but may have entailed a bit less money or more risk, they deny that firm an engaged, enthusiastic employee. It’s suboptimal all around.
Even top performers are saying security is a top priority. In fact, they want it more than do employees overall, according to a recent survey by consulting firm Watson Wyatt Worldwide. Job security was cited as a reason for joining an organization by 37 percent of top-performing employees.
That made it the second-ranking reason after “nature of work” for top performers. Thirty-three percent of all employees cited job security, tying for second place. Employers, meanwhile, appear clueless about this stability focus: Security didn’t make the top-five list for employers when asked why employees join an organization.
The recent career deliberations of a friend flesh out the point. He had two job offers in hand: a stable job he didn’t think he’d love and a position at a startup that is riskier but the kind of work he’s been fantasizing about. He eventually went with the startup, but came very close to turning down his dream job.
In particular, at one point he felt he couldn’t take the post without a guarantee of severance pay in case the job fell through. This demand, which the startup would not agree to, is unusual for midcareer business consultants like my friend.
But it is understandable given his recent economic experience. After losing his job nearly a year ago, he has been unemployed or underemployed as an independent consultant despite holding an advanced degree with a focus on China from an elite university. Without work, he has faced the loss of a cherished private school for his kids, home foreclosure and strained relations at times with his spouse.
And yet a dispassionate look at my friend’s work situation showed him getting an increasing number of consulting projects, two recent full-time job offers (the ones he was weighing) and growing economies in both the U.S. and China. His prospects would be good even if the startup flopped in a few months.
In other words, he was approaching his job choice with the scars of economic insecurity distracting him. And they came close to keeping him from a choice likely to benefit both him and the startup.
The severance issue was not my friend’s only concern with the startup job, but it was a major one. Eventually, he dropped that demand and took the leap. But how many of the country’s millions of unemployed and underemployed are going for the safer bet? How many will go for the safer bet in the months and years ahead?
Companies overall were quick to ax employees during the recession. And they are rehiring slowly.
If economic life for Americans is akin to climbing a mountain, we’ve allowed that journey to become very hazardous, very slippery. It’s easy to lose your footing or get knocked off your feet and tumble down far. Firms want people who are eager to take risks and rise to new heights. But don’t be surprised if battered and bruised Americans instead seek refuge in low-lying caves—to the detriment of all.
Looked at one way, a raft of recent data about what employees want suggests they are hopelessly schizophrenic.
But it’s also possible to read the research as showing workers to be entirely sane—and asking for things employers either can’t fathom or don’t want to know about.
Let’s look at job security first. According to a recent Watson Wyatt Worldwide survey, job security was cited as a reason for joining an organization by 37 percent of top-performing employees, making it the second-highest-ranking reason. But research from the Corporate Executive Board indicates that once workers take a spot in a firm, organizational stability is not one of the most important drivers of employee engagement.
Indeed, employees say they want excitement. In a Salary.com study published this year, 35 percent of employees named “boredom” as a significant factor in an employee’s decision to look for a new job, enough to make it the fourth-highest factor. But Corporate Executive Board data show that employee engagement is deflated by disruptive change such as massive restructuring, and even more so by the anticipation of such change.
Employees also say they want a caring, encouraging employer. In a recent Randstad study, 80 percent of American employees said their ideal employer “cares about their employees as much as their customers,” putting that response in a tie for first place. And 75 percent of employees said that “recognizing and rewarding employee successes” was an important leadership practice.
That ranked as employees’ top answer for leadership practices. But right behind it was a nod to standards: 74 percent of employees said that “holding people accountable for their behavior” was an important leadership practice.
Given these responses, do employees collectively suffer from multiple personality disorder? I think not. Taken as a whole, what workers are getting at is a common-sense desire for a baseline of economic stability as well as a supportive yet challenging work environment.
These goals can be better understood in the context of economic and cultural trends going back 30 years. Economic risk has shifted to workers and families from business and government since the 1980s. Layoffs, pay cuts and roller coaster retirement accounts during the past year have added to the financial anxiety.
Employers don’t seem to get this picture of what workers want. In the Salary.com study, only 20 percent of employers thought boredom was a significant factor in an employee’s decision to look elsewhere—a difference of 15 percentage points from employees. And in the Watson Wyatt report, job security didn’t turn up among the top five reasons employers gave for why employees join a firm.
I’d bet the disconnect is partly ideological. Many company execs adhere to a pull-yourself-up-by-your-bootstraps mentality, downplaying the role of the group or the need for stability. It also may be that companies consciously want to avoid opening the door to an earlier era where their flexibility to hire and fire was limited.
In any event, some companies seem to be sticking their heads in the sand about security. Adam Zuckerman, a consultant with advisory firm Towers Perrin, says a lot of companies don’t ask directly about security when surveying employees. Another business consultant involved with engagement issues, Laurie Bassi, says she has talked with company leaders who didn’t want to ask their employees about job security.
“This is kind of like going to the doctor and saying, ‘I don’t want you to do that cancer test, because I just don’t want to know,’ ” Bassi says.
The attitude of denial suggests to me that business leaders, more so than workers, may need a head examination. In a world where engaged employees are increasingly critical to business success, a wise company will want to think clearly about how to win over its workforce.
Under the contract, thousands of recruiters in cities and districts across China will use London-based MrTed’s software to better connect employers with workers in the private sector.
“For the employer, it’s a recruiting service,” says Jerome Ternynck, CEO and co-founder of MrTed. “For the employee, it’s a placement service.”
Recruiting software products such as MrTed’s TalentLink do such things as manage job requisitions, track résumés and rank applicants against job openings.
Ternynck says the project in China is focused on “talent,” which refers to a class of workers distinct from farmers and civil servants. The goal behind the software effort is to speed up the time it takes to return “talents” to employment from an average of four months to three months, Ternynck says.
Although exact terms of the contract weren’t disclosed, Ternynck says it will bring MrTed annual revenue in the seven figures in U.S. dollars. The deal amounts to a feather in the cap for MrTed. Ternynck’s firm prides itself on its global capabilities, and calls the Chinese effort the largest-ever implementation of talent acquisition software provided over the Internet.
According to U.S. government estimates, China’s urban unemployment rate was 4 percent in 2008. But if the country’s large population of migrant workers is included, the total unemployment rate may have been as high as 9 percent.
Labor unrest in China can get ugly, and potentially represents a threat to the authoritarian government. In this light, the deal with MrTed is a forward-thinking move. I’m also not aware of many other deals by government agencies along these lines. Ternynck says MrTed was tapped for a similar pilot project in France not long ago, and showed decent results. But the effort died partly because of bureaucratic infighting, he says.
If so, it wouldn’t be the first time promising technology for boosting employment was unplugged for suspect reasons. In 2007, the Bush administration killed public job board America’s Job Bank without a thorough explanation. The absence of the site hamstrung an effort at the beginning of the recession to help Americans get back to work.
Not only will more jobs restore a sense of economic stability and peace of mind to millions of out-of-work Americans, but it will also help make the nascent recovery more sustainable.
China is taking action to combat unemployment. America can too.
There’s been talk of late of the withering effects of corporations on workers’ souls.
It’s true that many jobs in corporate America are draining and can challenge one’s ethical code—telemarketing posts come to mind. And during this recession it appears many firms acted in shortsighted, callous ways that have helped kill workers’ spirits.
But I don’t think large companies are beyond redemption. In fact, the seeds of renewal are at hand for a better place to work for employees and managers alike.
Among the chief critics of the corporate workplace is Matthew Crawford. Crawford owns a motorcycle repair shop and writes about the virtues of manual labor and the moral perils of “knowledge work.”
In an essay published earlier this year in The New York Times Magazine, Crawford makes some interesting points about the way working as a mechanic prompts attentiveness, receptivity and humility. His earlier work as a writer of article abstracts and as leader of a Washington think tank, by contrast, pressured him into misrepresenting others’ ideas and fitting facts into foregone conclusions.
“Mechanical work has required me to cultivate different intellectual habits,” he wrote. “Further, habits of mind have an ethical dimension that we don’t often think about. Good diagnosis requires attentiveness to the machine, almost a conversation with it, rather than assertiveness, as in the position papers produced on K Street.”
But many workers in modern corporations have to pay close attention to business operations or market trends to succeed. And they are keenly aware they can fail with a new software product or ad campaign or manufacturing process.
As Kelefa Sennah suggested recently in The New Yorker, a retail marketing specialist tweaking a display rack is interacting with the physical world not too differently from the way a motorcycle mechanic does. “Why shouldn’t a retail display rack count as a tool, in Crawford’s sense of the word?” Sennah writes. “It’s a physical device meant to perform a particular function, and the shop’s cash registers generate a fairly accurate record of how well it succeeds.”
The real question with work, Sennah argues, is whether it is dull and repetitive, not whether it is manual.
Crawford’s vision for work that is absorbing and meaningful, ultimately, is the same one companies have for their workers. Firms want engagement, given that passion and commitment lead to better business results.
Engagement appears to have slid during the recession. A recent report from consulting firm Watson Wyatt Worldwide found employee engagement levels for workers overall dropped 9 percent since last year. Engagement fell close to 25 percent for top performers.
But there is still hope for corporations and workers, it seems to me. Regulatory, demographic and cultural trends are pushing firms to become more careful about job cuts, more socially responsible, more transparent, more democratic and more sustainable. Companies out ahead of these forces include Indian technology services provider HCL and online retailer Zappos.com, whose egalitarian, high-performance culture helped persuade Amazon.com to buy it.
U.S. workers themselves haven’t given up hope on companies. A recent report from staffing Randstad finds that Americans’ ideal employer cares about its employees and delivers on its promise to customers. The report also shows Americans want leaders who hold people accountable.
Caring, integrity, accountability. What workers want in organizations are soul-nourishing characteristics. Will companies fulfill those wishes?
Recent reports about workplace morale make it clearer still that the pendulum has swung too far in the direction of the disposable employee.
Employees feeling more secure on the job are much more satisfied with their work, according to a study published last month by job board SnagAJob.com. The survey of about 1,000 U.S. workers found that 52 percent reported a decline in job security compared with a year ago—and of those, just 49 percent expressed happiness with their jobs. Of those who think their jobs are more secure, 70 percent say they are happy at work.
Job happiness is a close cousin to employee engagement—the commitment employees feel to their employers and how much extra effort they give. Employee engagement data in recent months has been mixed but on the whole indicates a decline. And drooping engagement weighs on the bottom line.
Earlier this year, the Corporate Executive Board said the percentage of employees showing high levels of discretionary effort had dropped from 17.2 percent in 2005 to 6.5 percent, and that the decline in engagement is decreasing overall productivity by 3 to 5 percent.
A new report from staffing firm Randstad, on its surface, finds a countervailing trend. Employee morale in the U.S. is at its highest since 2004, says the survey of about 2,200 employees and some 830 employers. What’s more, 57 percent of employees say they are loyal to their firms, up 8 percentage points from last year.
But Randstad finds rockiness amid the rah-rah. Just a quarter of employees say their companies are loyal to them. And, the report notes, a morale boost is typical in a recession.
“This isn’t really a picture of satisfaction,” the study says. In the wake of widespread layoffs, “remaining workers are happy to have their jobs, but they feel the loss of their workplace families,” the report says. “They are optimistic about their futures, but the feeling is slipping every year.”
Americans’ resiliency has been battered by three decades of firms treating employees as disposable, as author Louis Uchitelle puts it.
It’s as if workers want to love their employers, but keep getting spurned by firms fundamentally focused on short-term results in a cutthroat global economy.
It’s a testament to Americans’ hopefulness and sense of dignity that, if anything, workers want more from workplaces these days. The Randstad survey found that 80 percent of employees say their ideal employer “cares about their employees as much as their customers,” up from 66 percent last year. That was the top response, tied with “delivers on its promise to customers,” which was up 15 percentage points from last year. It seems that in the wake of fraud in the housing and financial fields, workers are putting a higher value on a firm’s integrity.
Even if we’re headed toward organizations with a smaller “core” of employees, those workers likely will perform best with a degree of job security and a culture of true respect for customers and workers.
Another way to frame the issue is to move to seeing employees as “recyclable.” That is, don’t trash them to make the quarterly numbers. Do your best to keep them, and keep helping them upgrade their skills to fit your changing business needs.
Companies hoping to thrive in the recovery ahead would do well to get out in front of the pendulum’s return. Ever more data indicates the era of the disposable employee is coming to an end.
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