Stresses and Strains in the Business World
In the early phases of globalization, when the advanced countries dominated the global economy, there was not much fear that globalization would produce a race to the bottom or induce an interminable negative spiral. As emerging economies like India and China have come to exert an increasingly powerful influence, however, the atmosphere has changed. People in the advanced countries have started to realize that the process of globalization will not necessarily make their own prospects brighter. The dominance of China as the worldâs manufacturing powerhouse and the success of India as a center of service outsourcing pose particular threats to the established order. Evidently, global competition has become increasingly intense. The number of players in the global market has increased dramatically over past decades as former socialist countries and emerging nations have entered the capitalist economy. For companies, reducing costs and payroll expenses and improving quality are more urgent challenges than ever before.
Furthermore, companies have come under pressure to perform a growing number of roles for various stakeholders . Shareholders, clients, employees, and other stakeholders all make demands on companies, and society at large requires companies to fulfill numerous responsibilities. Nobody could have imagined these conditions forty years ago. Companies never had to face so many diverse demands then. Today, companies are required to achieve much higher levels of performance in order to survive as they are forced to meet the exacting demands of their various stakeholders and the wider society.
Many corporations in advanced countries have responded to the intensified global competition by adopting increasingly market-principle-oriented policies . These steps have included strategic alliances , outsourcing , diversification of work contracts, flatter management hierarchies, downsizing and restructuring , and greater flexibility. These policies have helped to improve results in many companies. But they have also brought wrenching changes to the employment situation and working conditions for many employees in the advanced countries. International competition and breakthroughs in IT have made managers more focused than ever on short-term returns. Together with new management techniques, these changes have made workersâ jobs more uncertain and contingent in almost every type of work.
Aiming for greater efficiency and seeking to cut payroll costs, many companies have reduced the proportion of permanent employees on full benefits, and instead increased the proportion of nonpermanent employees , including part-timers, fixed-term contract employees, and temporary staff. Companies have found they need to be able to adjust their workforce whenever necessary, in order to respond promptly to an ever-shifting business climate. Many companies have systematized non-regular employment as an important part of their recruitment policy to allow them to carry out such adjustments more easily. Many of the newly created jobs are overwhelmingly in these categories of non-regular employment. The change in employment patterns has had a significant impact on the structure of the labor market as a whole. The new economic environment in which free-market competition is being encouraged has produced a newly affluent class of people as successful entrepreneurs as well as a mass of workers without permanent jobs who move from one unstable, irregular, low-paid position to another. And in workplaces where permanent staff are being replaced by nonpermanent employees , remaining permanent employees often experience increased demands on their time and labor to make up for the insufficient knowledge or skills of the nonpermanent workforce.
Additionally, as noted above, many companies have worked to flatten their organizational hierarchies in an effort to become more competitive. This has led to the creation of decentralized units of profit and power within the organization as responsibility has been delegated down the management chain. In todayâs knowledge, IT, and service industries, this type of shake-up in the workforce often means a heavier workload and more responsibilities on employees. Today, the production process depends on the involvement and commitment of employees to a much greater extent than was the case in the past. Formerly, employees worked with their colleagues on a particular stage of the production process; they were one of the cogs in the wheel. Today workers are called on to think, to be engaged, and to produce results for the company on their own initiative. 1 This tendency is particularly pronounced in the knowledge, IT, and service industries.
In the ever-expanding service sector, many jobs now involve a new kind of psychological stress not found in traditional blue-collar jobs. In the service industry, personal qualities like politeness, courtesy, kindness, and helpfulness have become the means by which people earn their living. People in these jobs must commodify not only their time and labor but also their very selves, including their personalities. They must constantly work to maintain a cooperative and amiable attitudeâat least on the surface, and outwardly display the emotional state and expression that their customers and superiors require. 2 These conditions lead to stress and discontent.
Employees in managerial positions are also facing greater uncertainty. Until the 1980s, large companies in advanced countries were able to offer management-track employees what amounted to lifetime employment and a predictable route to promotion. This situation changed dramatically from the 1980s on. The competitive pressure of globalization has brought major changes to the unspoken agreements that previously defined the employment terms and practices among middle managers and other white-collar employees. The days of secure, lifetime jobs with predictable promotions and stable incomes are now widely believed to be a thing of the past. 3
The spread of E-mail and other IT tools has helped make work more efficient, but have also led to longer working hours. 4 These changes in the working environment have had an obvious impact on peopleâs attachment to work and levels of job satisfaction, as evidenced by the decline of employee motivation in many countries around the world. The following section takes a look at how workplace motivation has eroded around the world over the past few decades.
The Motivation Crisis
The Global Fall in Motivation: Objective Indicators
Workplace motivation has been on a downward trajectory in many countries over the past several decades, a trend that continues today. In a survey conducted by Gallup on 230,000 full-time and part-time employees in 142 countries between 2011 and 2013, only 13% described themselves as âengaged.â 5 In other words, fully 87% of respondents answered that they were either ânot engagedâ or âactively disengaged.â This phenomenon is found worldwide. The proportion of people describing themselves as âengagedâ in Gallup surveys was no higher than 30% even in the United States, the country with the highest rate among leading countries, followed by Brazil (27%), Spain (18%), United Kingdom (17%), Sweden (16%), Canada (16%), Germany (15%), France (9%), India (9%), Japan (7%), and China (6%) (see Table 1.1).
Table 1.1
Employee engagement by country
(Source Gallup, âState of the Global Workplace,â 2013)
Engaged (%) | Not engaged (%) | Actively disengaged (%) | |
|---|---|---|---|
United States | 30 | 52 | 18 |
Brazil | 27 | 62 | 12 |
Spain | 18 | 62 | 20 |
United Kingdom | 17 | 57 | 26 |
Sweden | 16 | 73 | 12 |
Canada | 16 | 70 | 14 |
Germany | 15 | 61 | 24 |
France | 9 | 65 | 26 |
India | 9 | 60 | 31 |
Japan | 7 | 69 | 24 |
China | 6 | 68 | 26 |
Trends to the Present
Europe and North America
The observation that workers are less motivated and engaged than they used to be is nothing new. The first studies noting a decline in positive attachment to work in advanced countries appeared in the late 1970s and early 1980s. The University of Michiganâs Survey Research Center reported a âsignificant dropâ in Americansâ job satisfaction levels between 1973 and 1977. The Centerâs director is quoted as emphasizing the findings âbecause itâs the first confirmed decline in the national level of job satisfaction.â 6 Similarly, a Harris Poll carried out in the United States in 1981 found that the levels of motivation and dedication had dropped significantly from ten years previously, and showed that workersâ own expectation levels regarding their job performance had also fallen. 7 A look at the results of Gallup surveys reveals that whereas in 1980, 88% of respondents agreed with the statement that âit is personally important to me to work hard and do my best at work,â by 1983 this figure had fallen to 57%. 8 In a Gallup survey on work attitudes carried out in the United States in 2001, only 30% of people described themselves as âengaged.â This figure has not changed significantly in the years since, and remained at 30% in the 2011â2013 survey, as already noted.
Similar developments can be seen in Europe. In the 1950s, a majority of people in what was then West Germany told a public opinion survey that they thought âindustriousnessâ was their most admirable virtue. By the 1970s, however, increasing numbers of people were more skeptical about working too hard, and more than half of young people admitted to feeling dissatisfied at work. 9 In a survey in West Germany in 1983, only 26% of respondents supported the work ethic statement that they always gave their best at work. 10 Further, in the 2011â2013 Gallup survey , ...