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Leadership
Why uncertainty can increase job satisfaction
Conventional wisdom suggests uncertainty undermines morale. Research shows it can have the opposite effect. Here are five actions leaders can take to build engagement and resilience when times are tough.
Rapid read:
- Research shows that downturns can boost feelings of appreciation and positivity towards employers and organizations.
- Investing in this positivity thoughtfully can bolster engagement, growth, and resilience, and lead to greater future retention when the economy picks up.
- Leaders and organizations should prioritize transparency, development, recognition, purpose, and building trust and belonging.
Uncertainty undermines wellbeing. It can erode engagement, decision-making and performance, flush meaning or pleasure from the work that we do and ultimately lead to productivity losses for organizations. But uncertainty can also produce unexpected outcomes.
Our research suggests that while no one welcomes economic instability or financial downturns, they can nonetheless have a surprisingly positive impact on the way that people feel about the work they do and the jobs they have.
The good news, the bad news and the job satisfaction
My colleagues from Oglethorpe University and Hong Kong Polytechnic University and I had a hypothesis: would periods of economic upheaval also breed greater job satisfaction? We reasoned that while uncertainty is undoubtably stressful, it might also prompt people to spend less time thinking about other possible jobs and more time making the best of the job they have.
To test this possibility, we analyzed decades of survey data from more than 23,000 full-time American workers who participated in the US General Social Survey between 1974 and 2016. We also examined responses from approximately 13,000 UK workers who took part in the British Household Panel Survey between 1991 and 2013.
Both datasets span multiple recessions and recoveries and offer a window into how  economic conditions on both sides of the Atlantic shape how people think about their jobs. The patterns were remarkably consistent. Job satisfaction increased when times were hard but fell when the economy improved.
Next, we ran an experiment to test our ideas in a more controlled setting.  We invited one group to read a newspaper article indicating the economy was floundering and the labor market was sluggish, while a second group read a report indicating the economy was prospering and opportunities were plentiful. When asked about their own current jobs, those who had been primed to believe that the economy was doing poorly reported greater satisfaction than those who’d read about the economy doing well.
These findings suggest that the way people think and feel about their work is shaped not only by what is happening inside the workplace, but also by external forces outside it. In other words, bad news outside of work can make employees more appreciative of the jobs they already have. But why?
Job satisfaction is to some extent relative. When the outlook is stable and opportunities feel abundant, we tend to compare our current jobs with other possibilities that might exist elsewhere. Could there be other organizations that pay better, offer faster progression or more fulfilling work? When opportunities feel scarcer, the comparisons change. Instead of looking around for a better gig, we focus on what we already have. The thought process shifts from, “Is there something better out there?” to, “I really am lucky to have this job!”
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Periods of economic uncertainty are ideal opportunities to invest in your people.
What does this mean for organizations and decision makers?
Periods of economic uncertainty can provide ideal opportunities to invest in your people. That might sound counterintuitive but think about it this way. When people are appreciative of the work they have and more positively disposed toward their organizations, efforts to foster trust, recognize effort, accelerate growth and development and provide a stronger sense of purpose, meaning and direction are likely to pay longer-term dividends in engagement, energy, and commitment.
That’s the kind of resilience that any business needs to weather this storm, and the next. It’s also the kind of attitude that will help ensure your talent sticks with you when things pick up. So how should you capitalize on this unexpected reservoir of goodwill? Where should you focus your attention?
If job cuts become unavoidable, be honest and explain not only what is happening but why.
Here are five priorities for forward-thinking leaders and organizations:
1 – Be transparent.
People carry worries about household finances, job security, and the wider economy with them to the office. You can help reduce that burden by being upfront and clear about how the organization is responding to external pressures. If job cuts become unavoidable, be honest and explain not only what is happening but why. Your employees may not welcome difficult decisions, but they are far more likely to trust and commit to leaders who communicate openly, treat people fairly and demonstrate respect throughout the process.
2 – Resist the urge to control.
When things are chaotic, we typically try to counterbalance that disorder by exerting additional influence over the things we can control. This can mean monitoring, intervening in tasks, and even micromanaging your team members. Resist that urge. Build on the positivity that your people are feeling by giving them development opportunities. Stretch assignments, mentoring opportunities, cross-functional projects or new learning experiences all send a powerful message that the organization is committed to their long-term success. If people are already feeling more invested in their jobs, this is a great time to strengthen engagement today and retention tomorrow.
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3 – Recognize contribution.
If job satisfaction is already strong, the benefits of recognition can accrue exponentially. Recognition doesn’t have to be financial. If you’re facing economic constraints, find different ways to appreciate and acknowledge the hard work and effort that your employees are making. In your one-on-ones, take time to acknowledge what your people might be achieving with fewer resources and how they are navigating difficult situations. Tell them how much you appreciate them for sticking with their objectives and priorities. Above all, be authentic. Recognition grounded in specific behaviors and genuine appreciation reinforces people’s sense that they are appreciated, valued, and making a meaningful contribution.
4 – Reinforce purpose.
When the future feels unpredictable and familiar routines are disrupted, people naturally look for something stable to anchor themselves. Strong values and a clear sense of purpose provide that anchor. They offer a framework for making difficult decisions, help people distinguish what matters most from what is merely urgent, and create a sense of continuity even when circumstances are rapidly changing. Shared values reduce confusion and help employees act with greater confidence even in the absence of perfect information. When everything else feels uncertain, purpose becomes a source of stability, resilience, and coordination, helping people move forward together rather than simply react to the latest challenge.
5 -Hire thoughtfully.
Uncertain times are also excellent moments to hire new talent, if you can do so. Not only are you likely to have access to an unusually strong pool of candidates, but in other work I have found that people who start their jobs in a weak labor market tend to start with higher job satisfaction. When alternatives are limited, new employees tend to value the opportunities in front of them more than unattainable alternatives. That makes this a good time to bring in and nurture new talent. Build trust from the outset, invest in development, forge a strong sense of belonging and ensure that people coming in see a future for themselves in your organization even when the economy picks up and other opportunities emerge.
Recessions, economic downturns, and periods of uncertainty can foster anxiety, discouragement, and a sense that events are beyond anyone’s control. When things feel unpredictable, it is easy to fall back on instinctive but limiting behaviors. Yet these are precisely the moments when leadership matters most.
As a leader, you cannot eliminate uncertainty. But you can affect how people respond to it. The choices you make, the behaviors you model, and the environment you create can help people remain focused, resilient, and connected to a sense of purpose, even when the path ahead is unclear.
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