The Rough Notes Company

April 11, 2005

 

Satisfaction (not) guaranteed

A negative shift in employee attitudes—combined with changing needs and preferences—forces employers to re-think workplace strategies

–Tamara Erickson
Executive Vice President
Concours Group

By Phil Zinkewicz

The daily newspapers, periodicals and television have been replete in recent years with coverage of corporate scandals such as Enron and WorldCom. We have read, heard and seen reports alleging that major corporate executives, either through negligence, mismanagement or out-and-out fraud, have driven companies down the road to bankruptcy while enriching their own coffers. We have seen regulatory, legislative and investor outrage over these developments. The litigation surrounding these events will likely keep lawyers rich for some time to come.

But what of the employees of these corporations? Or, perhaps more appropriately, what must employees of any organization be thinking as they watch their counterparts stripped of their jobs, their benefits and their pensions?

Workplace survey

A recent nationwide survey of more than 7,000 workers aged 18 and older, sponsored by 24 leading U.S. companies, reveals that more than half of American workers question the basic morality of their organizations’ top leaders and say that their managers do not treat them fairly. The survey is titled “New Employer/Employee Equation Survey” and was conducted by Harris Interactive, Inc., for Age Wave, an independent think tank that counsels business and government on issues impacting an aging society, and the Concours Group, a global consultancy advising senior executives.

Reacting to ongoing corporate scandals, accelerating outsourcing and continued downsizing, only 36% of workers said they believe top managers act with honesty and integrity. Even fewer, 29%, believe management cares about advancing employee skills, while one-third of all workers believe they have reached a dead end at their jobs.

“This survey, an unusually broad-based look at today’s workforce, indicates a dramatic shift in traditional workplace attitudes, preferences, needs and aspirations,” said Ken Dychwald of Age Wave. Dychwald said the wide-ranging survey covers workers’ views on work, engagement in the workplace, benefits, forms of compensation, employer competence and integrity, and retirement. He said also that, facing a growing shortage of qualified workers and an aging workforce, employers must move rapidly to develop strategies for dealing with these emerging multi-generational workforce issues.

Other key findings of the survey include:

• Small firm employees feel far more engaged in their work than their corporate counterparts.
• Older workers are the most satisfied, the most engaged in their work and the least likely to feel burned out.
• Younger workers are the most distressed and restless, and they feel the least amount of loyalty to their employers.
• Substantial numbers of employees feel dead-ended and are seeking changes at work or new jobs altogether.
• Job security, health care coverage and professional development are valued above additional compensation.

“Management gurus talk about the difference between satisfied customers and delighted customers,” Tamara Erickson, executive vice president of the Concours Group, said. “Today, one of the most important things employers can do is convert merely satisfied employees into enthusiastic, engaged employees. This survey provides many specific indicators of how to do just that, while also re-engaging management on behalf of the company and its workforce.”

More statistics

Ready for more statistics? Across the American workforce, only 45% of workers say they are satisfied or extremely satisfied (12%) with their jobs. At the same time, a much lower number actually feel very engaged by their jobs. Only 20% feel very passionate about their jobs, less than 15% agree they feel strongly energized by their work, and only 31% strongly or moderately believe that their employer inspires the best in them.

Managers were only slightly more positive about the organizations they are charged with leading than employees as a whole. While nearly two-thirds (63%) agree that they care about the fate of their organizations, more than one-third surprisingly do not, according to the survey.

The survey also shows that increasing numbers of employees are coping with burnout (42%), while only one-third (33%) believe they have reached a dead end in their jobs and 21% are eager to change their jobs.

Health care concerns

Given the rising costs of health coverage, it’s no surprise that one of the major issues facing corporate America is providing health coverage to employees, the survey notes. “The data suggest that these pressures are compounded by the fact that overall health care coverage is the number one employee priority—more important than future retirement coverage, prescription drug or other benefits,” the survey says.

This brings us to another recent study conducted by Harvard University legal and medical researchers. The Harvard study reports that hundreds of thousands of Americans file for personal bankruptcy each year because of medical bills, even though they have health insurance. About 30% of people questioned in the study said they filed for bankruptcy because of an illness or injury even though most of them had health insurance when they first got sick. Many lost their jobs and their insurance because they got sick, while others faced thousands of dollars in co-payments and deductibles and services not covered by their insurance.

Policy analysts say these findings underscore the limitations of the nation’s current system of providing health insurance largely through employers.

All of this is particularly bad news at a time when many employers, to cut down on health care benefit costs, are demanding that employees pick up more of the costs of their health care coverage via higher deductibles for both their health care services and prescription drugs.

“When employees see their health care costs rising and their coverage diminishing, they develop a jaundiced view of their top management, especially when they see how top management is compensated,” Bob Morison, executive vice president of The Concours Group told Rough Notes. “They are aware of the difference between CEO compensation and the compensation given to the average worker. They can do the numbers. There’s not that disparity between CEO wages and employee wages in any other country.”

Morison said that the Age Wave-Concours employee/employer equation study did not specifically break out the insurance industry, but he did say that some of the findings are probably applicable. For example, the study found that employees of smaller firms (e.g., agents and brokers) report far greater job satisfaction than do employees of large firms (e.g., insurance companies). They are more likely to feel “energized” by their work (44% vs. 28% at large firms) and “very passionate” about their jobs (53% vs. 36%), according to Morison.

“Despite the more generous benefits provided by large firms—bonuses, stock options, grants, etc.—employees of smaller companies are more engaged and are more likely to really care about the fate of the organization,” Morison said. “They are also more willing to put forth extra effort to help the organization succeed and agree that the organization inspires the best in them.”

These are sobering thoughts for all industries in general. Age Wave and Concours are currently constructing a model of the new segments of the American workforce based on the survey and aimed at helping employers understand and engage all of their different types of workers more efficiently. The authors of the study believe that, in the 21st century workplace, the ability to manage “diversity” of work style, work stage and attitudes toward employment will drive success in recruiting, retaining and motivating the most talented and productive employee base. *