Thursday, May 22, 2014

Downsizing is bad for the health of employees who keep their jobs

Just been reading an article published in BMJ in 2004 on the impact of downsizing on the health of the employees who did not lose their jobs during a major downsizing.

It was a study from Finland across 10 towns following a major downsizing of municipal employees.

The results have significance for change managers today, particularly as the authors suggest that the findings may have been an underestimate of the impact on the health of the remaining employees.

This study is relevant today because while the number of employees were cut, the services provided by the municipality were not - does that have a familiar ring to it?

So job demands on the remaining employees increased, as did job insecurity but the sense of control among the workers decreased. in other words, a high work stress environment.

Their findings from their analysis of the data? There was an increase in sick leave and an increased risk of cardiovascular death among permanent employees who kept their jobs.

From the results they conclude downsizing may pose a severe risk to health.

Given the current increase in downsizing as a structural change to reduce costs in many organizations, this study underscores the need to use best practice change management practices under the guidance of skilled and effective change leaders.

In particular, leaders must understand the impact of change not only on the physical health of their people but as importantly on their emotional and mental health.

This is an equally if not more important cost saving measure in the long term, given the potential ramifications of ill health and death from poorly managed change not only on the survivors of downsizing but on the business itself.

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