1. Business Ideas
  2. Business Plans
  3. Startup Basics
  4. Startup Funding
  5. Franchising
  6. Success Stories
  7. Entrepreneurs
Product and service reviews are conducted independently by our editorial team, but we sometimes make money when you click on links. Learn more.
Start Your Business Business Ideas

Employee Concerns About Recession Affect Businesses


Business owners have serious reason to be concerned about the emotional well-being of their employees, new research finds. As employees become increasingly anxious about job security and financial worries during an economic recession, satisfaction with the job they have, commitment to their company and engagement with their work are all affected detrimentally. This trend could be self-fulfilling in that disengaged employees could have a negative impact on a company's products or services and lead to its decline which would inevitably see the company failing, according to the research.

The researchers have formulated a model of how such employee engagement can change during an economic downturn.

The model could help management identify and acknowledge the impact of employee anxiety and implement workplace actions that help staff stay engaged, committed and improve job satisfaction.

The researchers collected data at the height of the recession in 2009 from several hundred full-time employees in a range of jobs. The workers reported concern about whether or not they would keep their jobs and whether or not they would be compensated if their company did not survive the recession.

The team used a definition of employee engagement that says an engaged employee is one who is fully involved in and enthusiastic about their work. This might be qualified by adding that a fully engaged worker is prepared to offer discretionary effort or be willing to "go the extra mile,” the researchers said. They add that intuitively one would assume that workplace anxiety would have negative consequences on level of engagement and earlier research has supported this notion in recent years.

The research team recommends that managers acknowledge the impact of the anxiety generated during recessionary times and take actions to reduce the negative impact of workplace anxiety by providing employees with information related to the organization's current situation and each employee's status.

The research was conducted by Kenneth Green, a professor at Southern Arkansas University and Bobby Medlin of the College of Business at the University of Arkansas at Fort Smith. The research appears in the International Journal of Management and Enterprise Development.

Business News Daily Editor

Business News Daily was founded in 2010 as a resource for small business owners at all stages of their entrepreneurial journey. Our site is focused exclusively on giving small business advice, tutorials and insider insights. Business News Daily is owned by Business.com.