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Employee’s Well-Being Linked To Layoffs

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The Gallup organization has a remarkable track record in conducting global surveys and offer insights on how common factors impact employees in similar ways regardless of geography, ethnicity, culture, and other distinguishing characteristics. Gallup is also at the forefront of examining what used to be considered “soft” issues related to the human experience that have an impact on the more traditional “industrial” metrics like output, productivity, absenteeism and the like.

Recently released Gallup research points to a connection between an employee’s perceived sense of well-being (Gallup’s index measures the difference between whether employees feel they are “suffering” or “thriving”) and whether or not their employer is either hiring or laying off workers. I’m sure many of you will consider this obvious. Nevertheless, it is interesting to see what we consider to be an intuitive truth laid out in scientific detail.

The Details from Gallup

“Worldwide, workers who say their employer is currently letting workers go are less likely to be ‘thriving’ than those who say their employer is currently hiring, according to Gallup surveys conducted in more than 100 countries in 2008 and 2009. The global data reveal that workers who believe their companies are hiring new workers are 27 percentage points more likely to be thriving than suffering, nearly double the gap for workers at companies laying workers off (14 points). Those who say their company is not changing the size of its workforce fall about halfway in between, with a 20-point thriving gap.”

The Shifting Currents of Employee Mood

Okay, that makes sense. Employees are more likely to thrive when their employer is hiring. Gallup speculates, and we at Engagient would agree, that there is likely a connection between an employee’s perceived sense of job security and whether or not they are thriving. Job security is one of the more prevalent and obvious ways that an employee would assess their overall level of safety. When people don’t feel safe, for whatever reason, they have less productive “bandwidth” (working memory) to dedicate to the task they are working on.

Perhaps the most relevant point here is that you will never be able to get employees engaged in the workplace if a large part of their experience is a felt sense of risk around the security of their employment. It would make sense then, that’s the mood of employees — as an expression of their felt emotions — would decline if they felt at risk. In fact, Gallup found exactly that in their research. In addition to the findings indicating that employees are less likely to thrive if their employer is not hiring, Gallup also found a significant drop in mood of employees for the very same reasons. If an employee’s firm is hiring, there was a 39-point gap between employees reporting only “happiness and enjoyment” versus those reporting only “stress and worry.” That gap drops to 25 points for employees working in firms that are laying people off.

Gallup explains further, “Taken together, these findings suggest a pervasive effect of harsh economic realities (perceived ones, at least) on well-being all over the world. …the present findings suggest a direct connection between well-being and felt economic security. Thus, from the standpoint of well-being, the current economic crisis may have as much to do with worries about what will happen tomorrow as it does with economic problems today.”

BEST PRACTICE TIP — At Engagient we know proven ways to improve employee mood, regardless of the economic conditions. If a company is either laying off or has a hiring freeze, taking specific actions to reassure employees becomes critically important. We already know that simply having a job in an economic downturn is not reassuring to employees. We need to do more to provide employees with the conditions that they need to be truly engaged on the job. The impact on perceived job satisfaction, productivity, profitability, and the customer experience all hang in the balance.

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The following comments are for Engagient's Employee Engagement Seminar for Managers

We were trying to get the buy-in from our Management team, prior to rolling out a new Performance Review Process and move the management style away from the industrial age style in an attempt to get our employees more engaged.  For the last 45 years we have been working under the old world style of management and old habits die hard.  The Engagient seminar on Employee Engagement was exactly what we were looking to install at Perfect Plastic Printing.

Don presented the information with a passion and energy that impacted every participant.  The information presented represented the results of research and science as opposed to just one more consultant’s opinion.  This made the buy-in so much easier.  The combination of instruction and small group exercises kept the class from getting tired and kept the information geared more toward our business as opposed to generalizing information.  Don was extremely knowledgeable on the subject and this was apparent when he answered participant questions.  He kept the conversations light and humorous, but had you believing that getting your employees more engaged is crucial to surviving in business today.  The feedback from the Management team on the seminar was all positive. Don was one of the best presenters that we have experienced at Perfect Plastic Printing.

--Carl Valenti
Director of Facilities
Perfect Plastic Printing
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