Why a Quarter of Americans Don’t Trust Their Employers

Harvard Business Review

The American Psychological Association’s new Work and Well-Being Survey, released earlier this week, paints a hopeful picture about the state of American workers, with a few troubling caveats. I talked to Dr. David Ballard, the head of APA’s Center for Organizational Excellence, about employee-employer trust, how companies should tackle the issue of stress at an organizational level, and why we might be all wrong in the way we think about worker engagement. An edited version of our conversation is below.

Your baselines finding is that 70% of people are satisfied with their jobs. But what’s below the surface?

Our findings show we’re not at a crisis about job satisfaction, but that 70% number we float around doesn’t capture the full picture of what’s going on in organizations. There are some key areas in which people aren’t satisfied, specifically around growth and development opportunities and recognition. That paints a very different picture.

General Employee Satisfaction chart

The other important thing, and this isn’t a brand new finding, but whether or not employees feel valued is a huge differentiation. If you break the 70% down, 92% of employees who feel valued say they’re satisfied with their job compared with 29% of those who don’t feel valued. There’s a huge gulf in this area, and there are similar ones around training, development, and advancement.

Valued at Work Chart

When it comes to how employees feel about their employers, the big theme in this year’s study is trust — or a lack of it. What’s going on here?

We were interested in taking a look at the repercussion of the recession: The economy’s gotten better and the job market has allegedly gotten better, but quite a few employees are still really unhappy with many aspects of their workplace. We wanted to dig in more to find out what’s really going on.

Although almost two-thirds of employees feel like their company treats them fairly, other aspects don’t look so good. More than half feel like their employer isn’t open and upfront, a third feel that their organization isn’t always honest and truthful. One in four say they don’t trust their employer at all, and that’s a big deal.

Trust in the Workplace Chart

So how do you define trust?

Trust is really the expectation that workers can count on and rely on their organization. That involves a lot of things, including past interactions with their company, whether they feel like things are done fairly, openness in communication, whether their values are consistent with the company’s values, the reliability of the company, and their perceptions of their company’s motives.

Have these trends changed over time?

There are no specific trends we can track – this is the first year we asked specific questions about this trust – but we can look at related findings in past surveys. In 2009, for example, in the depths of the recession, more than two-thirds of respondents said their organization had taken steps as a result of the downturn to mitigate financial issues, including layoffs, cutting workers’ hours, reducing benefits and pay, forcing unpaid days off, and increasing workloads. In a survey a year later, in more than half of those cases, the cuts hadn’t been restored.

We know wages haven’t kept pace with improvements with the economy, and recent reports that CEO pay is 331 times that of the average worker haven’t helped matters. When your CEO is making as much in a day as you make in a year, and you helped your company bear the brunt of the recession, it’s easy to see how you might not be happy.

Employees are willing to pull together during difficult times, when things get better they expect to be recognized or compensated in some way.

How can employers gain this trust back, while also having, at times, to lay people off and instill policies that might not be popular?

When we looked at things that predicted trust, we found that there were three key things: employees’ perception of the level of involvement they have in their organization; recognition provided by their organization; and how well the organization communicates. These factors predicted more than half the variance in trust.

To better involve employees, companies can implement group problem solving, self-managed work teams, profit sharing and stock plans, and 360 performance evaluations. It’s not enough to just do the annual employee survey without letting people know what the results are and how changes based on them will be implemented. You need to give employees control and autonomy in what affects them every day.

In terms of recognition, employers must focus on monetary and non-monetary recognition, both formal and informal. Compensation is the most common type of work stress cited in our surveys year after year. Employers can reward people for high levels of performance, make employees visible for accomplishments, and implement peer recognition programs. Sometimes that’s more meaningful than praise from a manager.

Lastly, communication is critical, and it bleeds into all other workplace practices. Employers must support good communication between employees and managers, make sure everyone is familiar with the mission of the organization, and offer ongoing opportunities to give feedback to managers. Bottom-up communication is as important as top-down.

Importantly, communication isn’t just what you say – it’s what you do. For example, organizations sometimes implement wellness programs like a company gym. That’s great, but if employees never see a manager set foot in that gym, that’s a strong form of communication, too. Modeling behavior is very important.

It seems like the “how” is as important as the “what.”

During recessions, people ask whether healthy organizations suffered any damage. The answer: Yes. Even powerful organizations are at the whim of these larger things, and even companies that did all the right things had to make tough decisions. But what sets them apart is not what they did, but how they did it. The best organizations found ways to do tough things in ways that were healthy, fair, and as transparent as possible. It’s not that the bad stuff didn’t happen — it just happened better for the company and better for people involved.

Good companies used that as a chance to say, “we’re a better place to work” – and that actually helped them hire people in the end.

Switching gears a bit, only about 36% of survey respondents said they receive sufficient resources from their employers to manage stress. What can employers do better?

In our recent general survey on stress in America, 69% of adults said work is a major stressor. We dug into this survey to find what it’s about, and it comes down to two things: the actual availability of resources and the how their availability is communicated. This gets into what we talked about a minute ago — making sure employees know what’s there.

A lot of times that doesn’t happen. Employee assistance programs are underutilized in general, and most employees aren’t going to tap into them.

But even when organizations do try to address stress, they only tend to do it at the individual level. It’s like giving someone more armor, but sending them into the same battle over and over again. Organizations need to do better at addressing stress from a systems level to help individuals build better routines and habits into their workdays.

One company I know of has a psychologist who comes into the office every week – it has the effect of normalizing this behavior, making it OK for employees to go talk to someone about stress. This type of organizational intervention doesn’t happen nearly often enough.

Lastly, it’s important to note that being bored on the job can be stressful for workers, too.

Compared to other generations, Millennials report much higher levels of stress associated with many aspects of their jobs. What do you attribute this to? How can employers better understand and address these points of stress?

I wasn’t surprised to see that result.

Sources of Work Stress Chart

Yes, there are differences between generations. However, most of the time, the differences have more to do with the stage in life than the generation itself.

The most significant stress factors for Millennials were low salaries, a lack of opportunity for advancement, long hours – that’s not atypical of early career ladders. Couple that with the fact that this generation hit the job market at a terrible time in the economy, they’re getting a sour taste of what work looks like early in their careers.

As people age they get more resilient – not because of their generation but because of where they are in life. They can weather storms better and deal with stressors better. That comes with life experience.

That said, with any employee, you have to understand his or her needs and where the stress is coming from.

There are a lot of surveys on employee engagement, and yours found that more than 50% of employees are engaged, a much higher number than a recent Gallup poll. How do you account for these differences – and what can employers do to improve these levels?

It seems like every consulting firm has their own way of talking about it. The big differences are the way engagement is defined – everyone has totally different definitions so we’re often not even talking about the same thing.

The reality is that most of the time, the results that are being reported aren’t actually about engagement. If you look at the items in the survey, they’re taking items about job satisfaction, commitment, and motivation and repackaging those as engagement.

I think there is research on employee engagement that’s well done with validated measures, and the best is work by William Schaufeli and Arnold Bakker. They define engagement as a positive, fulfilling, work-related state of mind that is characterized in three buckets: vigor, dedication, and absorption in work. We use a short form of this definition in our research.

The reality is that, while it’s not a rosy picture, it’s a much more balanced picture that you usually hear in the media.

Employee Engagement Chart

The other key piece is that what engagement looks like varies from organization to organization. As a leader, you need to figure out what keeps employees engaged at your company, and understand how it affects performance. You can’t make someone engaged — it’s an internal state. But you can provide an environment and context that makes engagement more likely.

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