Work Hard or Disengage in the Face of Job Insecurity?

Topic: Performance, Turnover
Publication: Journal of Occupational and Organizational Psychology (MAR 2010)
Article: A model for the effects of job insecurity on performance, turnover intention, and absenteeism
Authors: T. Staufenbiel and C.J. König
Reviewed By: Benjamin Granger

Job insecurity is in the air but how it affects performance is unclear. In a rather timely article on the role of job insecurity and predicting various workplace outcomes (job performance, turnover intentions and absenteeism), Staufenbiel and König (2010) collected data from 152 employees working for a German electronics wholesaler.

Past research on job insecurity suggests two basic reasons why job insecurity should relate to performance.  Interestingly, they conflict:

(1) Job insecurity leads to poor work attitudes (i.e., job dissatisfaction, lower organizational commitment) which then leads to a decrease in work performance.

(2) Job insecurity leads employees to ‘step up to the plate’ and increase their performance to avoid being laid off (i.e., good performance is considered a safeguard to being fired).

Although these lines of reasoning are at odds with each other, Staufenbiel and König argue that both processes can operate simultaneously and this is indeed what they found in their study. Specifically, their findings confirmed that job insecurity leads to reduced work attitudes, which in turn leads to a decrease in job performance, an increase in turnover intentions and higher rates of absenteeism.  However, job insecurity also seems to simultaneously push employees to increase their performance at work, be absent less often and be less likely to consider quitting.

While this may still seem odd, Staufenbiel and König found that this dual explanation for how job insecurity affects workplace outcomes is much more plausible than considering only its negative effect on performance.  It is important to note, however, that job insecurity’s negative influence on performance, turnover intentions and absenteeism is stronger than its direct positive effects on these important outcomes.

In conclusion, Staufenbiel and König warn against managers using job insecurity as a motivational tool (“get to work or we’ll find someone to replace you!”). While this may indeed get employees to step it up a notch in the short term, it can also negatively influence their work attitudes which have the opposite – and much longer lasting – effect on performance.

Staufenbiel, T., & König, C.J. (2010). A model for the effects of job insecurity on performance, turnover intention, and absenteeism. Journal of Occupational and
Organizational Psychology, 83
, 101-117.