February 10, 2009 in Features

Layoffs affect health of remaining workers

Study finds long-term effects

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Pfizer. Saks. Microsoft. The layoff announcements just keep coming. And they’re going to keep coming if the U.S. economy continues its alarming and deepening spiral.

More than 2.5 million Americans lost their jobs in 2008. And at least 2 million jobs are expected to evaporate in 2009, according to the Conference Board Employment Trends Index – upping the ranks of the unemployed and forcing laid-off employees to dredge their safety nets and call on every available support system. But laid-off employees aren’t the only ones who suffer from staff reductions.

Employees who remain employed are prone to greater role ambiguity and job demands that can, in turn, contribute to greater alcohol consumption and depression, according to a 2003 study on the physical and mental-health effects of surviving layoffs, published by the Institute of Behavioral Science. In addition, the study found that layoff survivors often experience worsening physical health: They eat differently, smoke more, suffer from neck and back pain, and increase their use of sick days. Workplace injuries also rise.

“None of the effects are good,” said Frank Landy, author of “Work in the 21st Century.” An organizational psychologist, Landy specializes in understanding the emotions of work. “Layoffs clearly have emotional and practical consequences for companies and workers.”

Those consequences are, unfortunately, long-term. The psychological fallout of surviving a layoff lasts six years, according to the study published by the Institute of Behavioral Science. And the effects of surviving multiple layoffs are cumulative.

“It only takes one action of distrust to lose basic confidence in the employer. It’s like a romantic relationship. Once the trust has been undermined, it’s very, very difficult to recover,” Landy said. “There’s no data that suggests workers become more resilient. ‘I’m a survivor, hear me shout’? It doesn’t happen.”

Even so, Evan Wagner is giving it his best can-do spirit. Usually, it’s with an ample assist from Diet Coke. The IndyMac Bank corporate communications director downs three cans of the stuff each morning to help him cope with the exhaustion and back pain he blames on overwork.

Wagner, 26, joined the company in mid-2006, when the housing market was riding high and the company had a work force of 10,000. Two waves of layoffs, two rounds of buyouts and one federal government takeover later, the company is down to 2,000 employees, leaving Wagner to “do the jobs once done by four people,” he said in an e-mail he was writing at 1 a.m. on a recent weeknight while sick with a cold. “I typically work six days a week these days.”

He hasn’t taken any vacation time in two years – a decision that “is half by choice and half by necessity. … It’s nice to know the cash equivalent of my vacation time is there for me when my job ends,” he wrote, adding, “The thing about being in a layoff environment is that you’re always waiting for the other shoe to drop.”

Lingering distrust is one of the final stops on the emotional misery tour taken by most surviving employees. First, there’s the disbelief, anxiety and desperation resulting from the initial layoff announcement. Then comes the sweeping sense of relief when one’s job is spared, followed, in rapid succession, by guilt, fear and stress.

In a volatile labor climate that’s rapidly shedding existing jobs across all sectors of the economy, and during which any available employment might be likely to bring less pay, that emotional trajectory is only amplified.

“One of the most important things for people to cultivate is a positive attitude – the realization that this is temporary. Because if you listen to all the bad news, it’s a self-defeating prophecy,” said Judith Hoppin, president of the National Career Development Association in Bloomfield Hills, Mich.

Working near the heart of the long-declining automotive industry, Hoppin has been dealing with surviving-employee situations for almost 20 years. According to Hoppin, an employee’s best courses of action are physical exercise, good nutrition and communication with management to figure out the company’s priorities. “What you’re really looking at is, ‘How do I survive? How do I help the organization thrive under the circumstances?’ ” she explained.

As for the employer, Hoppin said, “It’s in the company’s best interest to help employees who are left. If somebody’s anxious and depressed and fearful, they’re not going to be very productive. So No. 1 is, open communication about what’s happening in the organization: why the layoffs have occurred, what is the plan. And then providing stress management services for people who are still there.”

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