Article: How can you manage recession-related stress in your workforce?


How can you manage recession-related stress in your workforce?

Recession can cause immense stress among employees, what can companies do to resolve this

Stress is currently the second biggest cause of employee absence, second only to musculoskeletal conditions


Higher absenteeism is a common manifestation of increased stress among employees


In these tough economic times when earnings fall and money troubles increase, people in all walks of life suffer the consequences. This includes the whole spectrum of employees - from those earning the minimum wage to those who get bumper bonuses. Individuals who are concerned about the future of their jobs and financial security are under a great deal of stress. Earlier this year in a US study entitled ‘The Hits Just Keep Coming: How the Recession is Affecting Families and work’, Wayne Hochwarter found that more than 70% of men and women cited the recession as having considerably increased the stress levels of employees. Moreover, 55% reported that management had become more demanding over the same period and as many as 80% were nervous about their long-term financial security.

Stress is currently the second biggest cause of employee absence, second only to musculoskeletal conditions. The WHO recently predicted that levels of stress and mental health problems will soar over the coming years as a result of the recession.

Signs to look out for:

In light of such research and predictions, no manager can afford to ignore the effects that recession related stress has on their staff. With many companies downsizing and/or restructuring employees are faced with a constant barrage of changes to which they are expected to adjust - new job descriptions, amended company policies and procedures, higher workloads together with an all-encompassing apprehension about their future. It should come as no surprise then that such overwhelming pressures adversely affect employees’ motivation and morale. This can lead to chronic underperformance which in turn can threaten the organization’s need to stay competitive, effective and cost efficient – a must if it is to survive in a hostile economic environment.

It is therefore very important for managers to look out for any indication of such problems in order for them to be suitably dealt with. Some of the things to be aware of include:

  • Higher Absenteeism: This is a common manifestation of increased stress in employees who are unable to cope with a pressurized working environment. Individuals take more days off work citing various reasons. A rise in the incidents of sick leave both in its frequency and duration is another warning sign that cannot be overlooked. Medical experts say that health complaints such as headaches, muscular tension, insomnia, anxiety and depression could all be related to stress.
  • Presenteeism’: Some employees worried about keeping their jobs often end up going to work even when they are sick because they feel they have a greater need to perform. This not only has a detrimental effect on productivity but also results in them infecting other people. A Cornell Chronicle article published in 2004 estimated on-the-job productivity losses from ‘presenteeism’ to be as high as 60% of the total cost of worker illness. Another side effect of this could be a rise in on-the-job accidents if employees are not physically or mentally capable of performing their duties.
  • Workplace conflicts: The strain of having to perform in a stressful situation sometimes also shows up as increased friction and disagreements with colleagues and/or management.
  • Inability to perform: One can also see how overwhelmed, stressed out employees would not have the interest and energy in achieving their workplace goals. They would be more focused on trying to cope with the various current and future changes that might be coming their way.

What measures can managers take to minimize employee stress?

In times of recession it is doubly important for managers to be aware of any changes in employee behaviour. A close eye needs to be kept on staff motivation, attendance and timekeeping, as well as their level of performance. Any fluctuations need to be looked at and steps taken in time for any issues to become real problems.

In fact the measures outlined below should be considered by most organizations going through or even planning any sort of upheaval or change - if they want to prevent such issues arising.

  • Communication: A news vacuum is where most rumours start and often these rumours assume the worst and therefore have a negative affect on staff morale. A fear of the unknown is a major part of how people react to change. Managers need to ensure that they have a factual, open and frequent communication strategy which helps to minimize speculation and anxiety. Ask the employees what information they want and the best ways to get it to them. Ensure that you keep them in the information feedback loop as far as possible – taking the unknown out of the equation will go a long way in making your workforce comfortable with change.
  • Participation: Autonomous, closed door management practices lead to resentment and lower motivation. That is why in tough times it is all the more critical to have a participative style of management with employees having a sense of ‘ownership’ for some decisions and the results that occur. The more decision making authority individuals have in their work – the more in control they feel. This goes a long way in minimizing the stress they feel in difficult situations.
  • Knowledge: Managers and employees alike should be made aware of the effects of stress and how to deal with it. Running company wide training programmes on the topic would go some way in empowering employees to cope with some of the negative consequences. Such training programmes also show the employees that the organization is taking the issue seriously.
  • Clarity of Goals: In times of change employees’ often feel that their managers’ expectations are unclear with their individual roles becoming less defined. This, coupled with the perceived pressure to perform ‘better’ than usual, is a major factor in increasing employee stress levels. Management therefore needs to ensure that all personnel have clearly spelled out tasks and goals in line with organizational expectations.
  • Recognition: It is necessary to give full recognition of individual achievement, especially in an environment where employees are unsure of their new roles. This does not need to be in a financial form - appreciation and praise on individual accomplishments goes a long way in winning employee engagement.
  • Strengthen Relationships: Research by Gallup Organization and other firms have shown that when employees believe their boss and their employer cares about them, they are far more productive and loyal. Team building and relationship building events cost relatively little but are likely to have a positive effect on employee morale.


Managers need to be aware of the effects the recession on employee stress levels. A successful stress management plan will ensure that all staff perform better and enable the organization to respond and adapt to the changing economic, social and political climate.

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Topics: C-Suite, Employee Engagement, #Culture

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