How can organisations manage job insecurity and employee behaviour during challenging times?

job insecurity

By Saloni Bhatia, Psychology Researcher

The last few years have transformed the ways in which people work. The rise in automation, digitisation, and outsourcing have threatened and made several jobs redundant. The year 2020 in particular, has been challenging for many as we navigate Covid-19 related uncertainty. This global crisis has also significantly affected the world of work. While it has propelled flexible and virtual working, it has also led to hiring freezes, furloughs, and layoffs. These outcomes have been stressful for many, including for those who are still employed.

Job insecurity can be defined as “the perceived threat of losing the current job in the near future[i]. Environmental factors such as economic conditions or organisational changes, as well as individual level factors like personality, gender, or even workplace relationships can influence this experience of job insecurity[ii]. The ongoing pandemic has created a great deal of job insecurity for people as they witness redundancies, decreased company performance, and simultaneously experience uncertainty around their own work future.

What are the organisational consequences of job insecurity?

Job insecurity can lead to voluntary resignations and turnover intentions[iii] which can be harmful for organisations. It can also result in a reduction in organisational citizenship behaviours (OCBs). OCBs are voluntary and positive behaviours that employees engage in at work that are not required of them or part of their contractual role (e.g., helping a co-worker meet a deadline). Job insecurity is linked to OCBs because it affects motivation and job satisfaction levels[iv]. Another outcome is the rise in counter-productive work behaviours such as bullying and decreased safety compliance[v]. Finally, job insecurity also has detrimental health outcomes impacting both mental and physical health by causing problems like emotional exhaustion, burnout, and poor sleep quality[vi],[vii]. This is important because poor employee health is associated with huge organisational costs due to lost productivity[viii].

Organisations can help stem job insecurity through several ways:

  1. Measurement – Studying employee experiences at work (e.g. through surveys or interviews) is an important first step. Examining the presence of job insecurity and how it may vary for different groups in the organisation can help understand work performance and productivity as well as support the creation of more targeted interventions.
  2. Communicating transparently – Research suggests that one way firms can control job insecurity is through timely and open communication of their future plans[ix]. This can be done by organising company-wide and one-on-one meetings (where feasible), or by sending out newsletters and emails. These can provide employees with clarity and reduce feelings of uncertainty.
  3. Providing upskilling and reskilling opportunities – Covid-19 has hit certain groups hard. For example, blue collar workers[x] and workers without university degrees[xi] are more likely to experience job insecurity as compared to white collar and highly educated workers. Mapping the skills they will require in the future, organisations must tailor development opportunities offered to their workforce. Such initiatives make employees feel valued in the organisation, reducing insecurity and increasing engagement.

 

For organisations to view job insecurity as a purely subjective experience that they have no control over would be erroneous. The employee disengagement associated with job insecurity can have serious organisational costs. However, through improvements in organisational practices and cultures, these can successfully be overcome.

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In Diverse Company offers a holistic approach to employee engagement which ensures that engagement is measured throughout the year through its platform Include LXPTM, keeping a constant check on engagement and inclusion and allowing leaders to act in the moment. Our engagement model looks at engagement across a range of areas – surveys relating to the employee life cycle, business topics, events that may impact engagement – thus allowing an organisation to identify trends, insights and most importantly action plans that will result in increased employee engagement.

If you want to know more, email our team at info@indiversecompany.com.

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[i] Vander Elst, T., De Cuyper, N., Baillien, E., Niesen, W., & De Witte, H. (2016). Perceived control and psychological contract breach as explanations of the relationships between job insecurity, job strain and coping reactions: Towards a theoretical integration. Stress and Health, 32(2), 100-116.

[ii] Shoss, M. K. (2017). Job Insecurity: An Integrative Review and Agenda for Future Research. Journal of Management, 43(6), 1911–1939.

[iii] Sverke, M., & Goslinga, S. (2003). The Consequences of Job Insecurity for Employers and Unions: Exit, Voice and Loyalty. Economic and Industrial Democracy, 24(2), 241–270.

[iv] Mahmoud, A. B., Reisel, W. D., Fuxman, L., & Mohr, I. (2020). A motivational standpoint of job insecurity effects on organizational citizenship behaviors: A generational study. Scandinavian journal of psychology.

[v] Lee, C., Huang, G. H., & Ashford, S. J. (2018). Job insecurity and the changing workplace: Recent developments and the future trends in job insecurity research.

[vi] Lee, C., Huang, G. H., & Ashford, S. J. (2018). Job insecurity and the changing workplace: Recent developments and the future trends in job insecurity research.

[vii] Virtanen, P., Janlert, U., & Hammarstrom, A. (2010). Exposure to temporary employment and job insecurity: a longitudinal study of the health effects. Occupational and Environmental Medicine, 68(8), 570–574.

[viii] Hafner, M., Van Stolk, C., Saunders, C. L., Krapels, J., & Baruch, B. (2015). Health, wellbeing and productivity in the workplace: A Britain’s Healthiest Company summary report.

[ix] De Witte, H., Vander Elst, T., & De Cuyper, N. (2015). Job Insecurity, Health and Well-Being. Sustainable Working Lives, 109–128.

[x] Goldin, I., & Muggah, R. (2020, October). COVID-19 is increasing multiple kinds of inequality. Here’s what we can do about it. Retrieved from https://www.weforum.org/agenda/2020/10/covid-19-is-increasing-multiple-kinds-of-inequality-here-s-what-we-can-do-about-it/

[xi] Makortoff, K. (2020, April). Workers without degrees hardest hit by Covid-19 crisis – study. Retrieved from https://www.theguardian.com/business/2020/apr/20/uk-workers-without-degrees-face-deeper-job-insecurity-amid-coronavirus-pandemic

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