How to manage staff positively in an economic downturn

Monday, May 11, 2009

Public sector staff have good cause for concern as organisations look to make cuts, so managers should know how to respond to their fears and attempt to achieve a positive outcome, says Professor Ivan Robertson

Managing in the public sector is never an easy task, but the current economic situation makes it more difficult than ever.

One thing that is very clear is that those who remain employed have it better than people who have already lost their jobs because of the recession. There is a substantial body of research showing that becoming unemployed (when it's not voluntary) has damaging consequences to psychological health. It is also clear that, on balance, work is beneficial for physical and psychological health.

This point has been made in Dame Carol Black's review of the health of Britain's working population, as well as the government's recent response to this work. The recently published research from the Foresight project focusing on mental capital and wellbeing, maps out the benefits of building positive workplaces and the costs for employers and employees alike if the environments they provide are not conducive to positive mental wellbeing.

So what are the key issues for managers during these difficult times? First and foremost, of course, people may be concerned about the security of their employment and may worry about the possible ways in which their job could be forced to change because of underlying economic pressures.

At Robertson Cooper we frequently collect data on behalf of organisations about the factors that are troubling people at work. We already know that the key factors that influence people's mental wellbeing at work can be summarised quite concisely: relationships with others at work (including the boss); work overload; lack of control; unfair pay and benefits; problems with work-life balance; lack of resources or poor communications cover most of the main issues.

A quick look at some of the more recent results (from a sample of more than 20,000 people) produces some interesting insights in the current economic context. The results show that most people view their relationships with others at work quite positively. Only 9 per cent of people report being troubled by poor relationships with colleagues at work.

One possible area of concern for managers, which may be related to the economic climate, is how people feel about others pulling their weight. In fact, our results show that more than 50 per cent of people report being concerned, to some degree, that they do not receive the support from others (boss/colleagues) that they would like. As the impact of the credit crunch increases and workforces become leaner, people in many workplaces may be expected to do more – per-haps making it harder to be supportive and helpful to colleagues. Nearly 60 per cent of our most recent sample reported some concern that others are not pulling their weight, compared with closer to 50 per cent in the preceding eight months.

The results are from different organisations, so are not necessarily caused by changes over time. Nevertheless, this does suggest that ensuring that the workplace feels like an equitable place is an area where managers should work particularly hard during the recession.

As well as influencing how people feel about their colleagues, the recession could have an impact across all of the areas that influence people's wellbeing at work. Maintaining the capacity to manage effectively with limited, and perhaps decreasing, resources – without damaging the psychological wellbeing of their people – could be the biggest challenge faced by managers.

There is a great deal of research showing that managers can have a major impact on the psychological wellbeing of their people. It is perhaps obvious that extreme or abusive management styles could lead to psychological distress. What may be less obvious is that even relatively minor infringements of good management behaviour may also have a significant impact on the mental health of employees.

Even quite minor shortfalls in relation to workplace justice by a manager (reminding an employee of past mistakes, criticising him/her to others, or failing to listen to problems) can be linked to psychological distress and even to subsequent physical health problems. However, good leadership and management is associated with positive employee outcomes. Factors such as good communications and group maintenance are examples of good management practices that make a difference, but that may come under threat when times are tough.

Although the recession may bring particular challenges for managers, there are actually many positives involved in trying to sustain employee wellbeing. Challenge itself is psychologically healthy – so nurturing the wellbeing of employees will definitely not involve removing, or even reducing, the challenge from their work. Our survey results support this, with 90 per cent of employees agreeing, to some degree, that they would be prepared to take on more responsibility, or new tasks not in their job description, if they were asked to do so. In fact, research in organisations shows that when people see changes as challenging they actually lead to improved job satisfaction.

By contrast, changes that are viewed as threatening damage job satisfaction and lead to higher levels of distress and sickness absence. So, perhaps managers may be able to expect more from people during these difficult times if they play their own role effectively. The objective for managers, in this sense, is to ensure that the demands they make on people are seen as challenging rather than threatening; an approach that will yield better results and be good for organisations, managers and employees alike.

Professor Ivan Robertson is managing director of Robertson Cooper Ltd www.robertsoncooper.com