The impact of this Great Recession on the US workforce
It would appear that even in the best-case scenario, many workers will jump ship as soon as the job market rebounds – particularly in organisations that suspend good talent management practices during the recession, writes Allan Schweyer
In May and June 2009, the Human Capital Institute and Monster
Worldwide conducted extensive survey research into the effects
of the “Great Recession” on the American workforce. More than 700
companies and almost 5000 passive and active job-seekers partici
pated. Concurrently, the researchers undertook a thorough review
of available research focused on this recession’s impact on the work
force. A number of business and thought leaders also expressed their
opinions during a series of one-on-one interviews.
When combined, these quantitative and qualitative findings reveal
impressions of a US workforce being reshaped by powerful economic
forces not seen since the 1940s. The results of our research are like
ly to hold true, in varying degrees, to countries outside the US, es
pecially those where customs and workforce culture are very similar,
such as Australia.
Concerns and observations
Both employees and employers express valid concerns and obser
vations, including:
• Because of older workers delaying retirement, those entering today’s
workforce will accept jobs for which they are overqualified, stay in
entry-level positions longer and face slower career paths. Em
ployees have lowered expectations for rapid career advancement.
• Young workers believe they will find themselves the stewards of
their own form of retirement – a self-financed, long-lasting, grad
ual process.
• Workers of all ages and experience levels appear resentful or fear
ful of their employers, stressed, and less productive – and poten
tially distracted by active searches for other employment. They are
less loyal, unhappy, and resentful about economic prospects.
• Employers face heightened risk regarding top talent, and are more
concerned about attrition of these employees than they were be
fore the recession began.
• Workers and employers agree that pay remains the dominant mo
tivation for US employees, and this motivation is not altered by the
recession. Some younger workers appear drawn to opportuni
ties for “service” for the greater good.
• Young workers, especially those representing Generation Y, seem
particularly cynical and mistrusting of “Corporate America.”
• Many employees are working harder as a result of their belief that
management has exploited the recession and become less tolerant
of challenges to authority.
• Employers have benefited from the swing of the labour market
pendulum, many workers admit that they are “just happy to have
a job” in this recession.
Where to from here?
Is there a light at the end of the tunnel? Many workers are using this
downturn to learn new skills and prepare for career changes, or to de
velop their own self-employment or freelance opportunities. They have
faith that technology and small business entrepreneurs – not just gov
ernment actions – will help the economy recover. And employers who
can convincingly offer workers job security might be able to out-re
cruit and out-retain their competition later.
For employers, caution remains key, even as the economy im
proves. They must pay attention even to short-term shifts in work
force attitudes during this rough period, or face the possibility of a
broad employee exodus when conditions stabilise.
At least in the short term, our research clearly shows that work
ers of all ages and at all levels are highly stressed. They appear sus
picious, resentful and even fearful of their employers, to the extent
that they are, in some cases, less productive at work and in most
cases, actively seeking work elsewhere. Organisations that ignore
these warning signs are likely to be harmed as the recession recedes.
It would appear that even in the best-case scenario, many work
ers will jump ship as soon as the job market rebounds – particularly
in organisations that suspend good talent management practices dur
ing the recession.
If there is a bottom line, it is this: Through all economic cycles,
the best organisations continue to pay attention to talent manage
ment and employee engagement, even when they are required to
downsize. The best-performing organisations keep in mind the eco
nomic recovery while making the necessary adjustments to survive
the recession.
Allan Schweyer is executive director of The Human Capital Institute. HCI and Monster Worldwide will
publish a three part series on the impact of the Great Recession. The research will be available at
www.hci.org. This article contains excerpts from the research.
