Job Insecurity: Why It Matters and Is It All Inside Your Head?

Key Points:

Job insecurity is significantly related to a staggering 51 unique negative work and individual outcomes.
Cognitive job insecurity – thoughts tied to job insecurity – and affective job insecurity – feelings tied to job insecurity – are found to be related but different concepts.
Feelings related to job insecurity seem to be more strongly related to the majority of negative outcomes than thoughts of job insecurity.
People who make their job a central feature of their identity are more emotionally susceptible to negative outcomes than people who don’t tend to identify as much with their job when they perceive a threat to their job.

You’ve no doubt heard the news that layoffs are trending. All it took for companies to start laying off thousands was the shift in the economic outlook and anticipation of the monetary policy changes that were going to follow that shift. The layoff frenzy seemed to start at tech where X (formerly Twitter) announced layoffs right after the Musk buyout and META announced laying off thousands of its employees right after its disappointing quarterly results in 2022. Soon after the fresh announcements other tech companies took on the mantle and laid off thousands and thousands of workers. The layoffs within the tech sector were not isolated to tech and as fears grew it began to permeate to other industries as companies joined the bandwagon with their own hiring freezes and massive layoffs. And It doesn’t seem like the end is near though as the household names that once were praised for opting to benefits cuts to the CEOs also giving in and announcing their first layoffs. Looking at you Apple.

Although economic indicators are still remaining stable, it has put many people on edge and wary of a looming recession and fearful of the contagious effects of spreading layoffs. Unsurprisingly, this worry, anxiety, and stress can have a pronounced impact on organizations and the people that comprise them. This has been termed by both the research and and popular press investigating the phenomena as “Job insecurity”. It’s the perceived powerlessness to maintain desired continuity in a threatened job situation (Greenhalgh and Rosenblatt, 1984) and what can be more relevant than such perceived powerlessness in today’s markets where massive layoffs and hiring freezes are commonplace to such an extent that the companies that don’t participate in layoffs stand out and not the other way around.

On a personal note I am one of the many impacted by layoffs as I had my applications to my dream consulting jobs frozen twice as a fresh graduate from master’s. I speak from personal experience when I say that it has taken a heavy toll on me along with the millions of others who are impacted by hiring freezes and extra competitive job markets due to increasing layoffs. But enough about me this paper is about the heavy toll job insecurity has on people and whether perception of threats to one’s job is enough to be emotionally affected by it.

We all need to make a living to eat and keep a roof over our heads. Losing your job means loss of security and income. For obvious reasons, this can lead to a great deal of stress. This is so well established that organizational psychologists – the people who study human thoughts, feelings, and behaviours in relation to work – have proposed an entire theory around it: conservation of resources theory. This theory explains that the conditions in which psychological stress occurs tend to be when resources are threatened with loss. It’s with this specific theory in mind that Lavaysse and Jiang (2018) conducted the most inclusive meta-analysis to date on the subject of job insecurity and its relationship with various outcomes. The study had an enormous dataset including 535 individual samples collected from 457 research articles and investigated the relationship between job insecurity and 58 unique outcomes. Together, they found that out of the 58 negative outcomes, job insecurity was significantly linked to 51. But they didn’t stop there, they also explored the different forms of job insecurity and whether or not they impact people in different ways.

Job insecurity can manifest in at least two different forms

Perception of one’s job may not necessarily mean a negative emotional reaction that’s where affective job insecurity might come in. To make that distinction it is argued that Job insecurity can be broken into two constructs:

Cognitive Job Insecurity: the perception of a threat(s) of a job loss.

Affective Job Insecurity: the emotional reactions to the perceived threat to one’s job (e.g., concern, worry, anxiety, fear).

So, to test things further Lavaysse and Jiang repeated their analyses after breaking studies into groups that examined either affective or cognitive job insecurity, looking for differences in their effects.

The 51 Negative Outcomes of Job Insecurity

The study found that job insecurity is a two-part detrimental phenomena, linked with at least 51 negative work-relevant outcomes and found evidence that affective and cognitive job insecurity are, indeed, two separate concepts, each being uniquely related to each outcome in differing ways than its counterpart. Additionally, the study found that affective aspects of job insecurity tend to be more strongly linked with negative outcomes than cognitive aspects of job insecurity. And last but not least people who seem to live for their job more, tend to be more emotionally affected by perceived threats of losing their job than people who tend to have more and more varied passions and interests (known in the science as work centrality).

What are the take-aways for you and your practice?

Based on this research, HR professionals, leaders, researchers and policymakers should consider some of these practical recommendations.

In today’s on again off again hectic markets, increased persistent job insecurity might be a thing that we all have to live with. However, instead of exclusively focusing on addressing peoples’ perceptions of job insecurity (for example, by trying to make sure your people feel secure that their jobs aren’t at risk in the first place), it may be wise to also strategically address affective aspect of job insecurity (for example, by making greater concerted efforts to alleviate existing fears, worries, and concerns and by helping to pre-emptively promote emotional self-regulation among your employees well in advance of any whispers of layoffs reaching their ears.This way organizations may benefit by helping their people to cope with job insecurity emotionally. To give further advice, Incorporating mindfulness and expressive writing exercises can help employees cope with insecurity emotionally(Buhrfeind & Pennebaker, 1994).

Given that work centrality makes things quite a bit worse, it may be a good idea for employers to try to encourage their employees to engage in their hobbies and other passions and interests outside of work when longer-term projections of layoffs seem likely. It may also be wise to give these hard workers extra attention as well. For example, during layoffs or restructuring, organizations may ensure that employees with high work centrality are involved in emotion-focused interventions prior to problem-focused ones.

Social and financial support programs by governments and nonprofits might be instrumental in targeting work centrality by providing skills upgrading services and free or subsidized education to their people. By making professional advancement accessible people may feel that their options are less limited and be more secure in themselves to find new work should they lose their job, or to start a new career should it be something that they would want to pursue.

We hope this article has made you a bit more aware and informed about the many negative ramifications that precarious employment can bring. It may be worth considering how stable your employees feel in their jobs at present and what you can do to alleviate thoughts and feelings regarding job insecurity to promote a more healthy and productive workplace.

Trustworthiness score:

The trustworthiness of the study is moderate (80%). This means there is a 20% chance that alternative explanations for the effect found are possible.

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References

Jiang, L., & Lavaysse, L. M. (2018). Cognitive and affective job insecurity: A meta-analysis and a primary study. Journal of Management, 44(6), 2307–2342. https://doi.org/10.1177/0149206318773853

Greenhalgh, L., & Rosenblatt, Z. (1984). Job insecurity: Toward conceptual clarity. The Academy of Management Review, 9(3), 438–448. https://doi.org/10.2307/258284