Jeffrey Saltzman's Blog

Enhancing Organizational Performance

Posts Tagged ‘social safety nets

Unsupported by Evidence

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I was recently on a panel at a local meeting in NYC of Industrial Organizational Psychologists and after much discussion I made a statement. I said that as a field we have almost completely and utterly failed at bridging the gap between the science and research that we do, the evidence-based and experimental knowledge that we gain and those who are out there in the world writing about people at work or organizations in the lay press, or those in organizations, making day-to-day decisions about them which affect both the organizations and the people within them. After all most of the information about people at work is just “common sense” isn’t it? And I am a person and I work, so I guess that makes me an expert.

Unfortunately, much of that “common sense” is not supported by the facts and in some cases the facts support the opposite conclusion or the common sense is generated by those who have an agenda in which facts are simply inconvenient. Here are some of the more common statements that I keep running across that either have no basis in reality, are the opposite of the actual evidence, rest on very shaky expansions or extrapolations of a small kernel of observation, or are based on a small handful of people or organizations at one tail or the other of a distribution, but ignore the vast majority of those in the “fat part” or middle of the distribution.

  • Statement: People will find jobs once their unemployment checks run out, a social safety net is an incentive not to work.

o   Reality: The vast majority of people want to positively contribute to society, as it makes them feel valued. People want to feel valued, it is a universal. The data show that people would rather be overworked than underworked and the desire to work and contribute is not diminished in societies with strong social safety nets. Can you find people who fit the above statement? Sure, but not the vast majority.

  • Statement: The various generations want and expect different things from the work environment.

o   Reality: There is simply no evidence to support the notion that different generations want different things from work. Rather the differences often cited are driven by life stage and economic opportunity. In other words, give a person a mortgage and kids in college and job security becomes more important to them. A person right out of college with no responsibilities or financial obligations will act similarly regardless of which generation they come from. Because life stages take a rather long time to get though they give the appearance of being generationally driven.

  • Statement: People join companies and leave managers.

  Reality: Are there “bad” managers out there that have driven people out of an organization? Absolutely. But the majority of people join an organization and then leave when they don’t see a promising future for themselves within the organization. Sometimes that feeling is caused by a bad manager, and sometimes by the simply reality of a mismatch between a person’s career expectations and what the organization can offer. And sometimes it is simply a person’s life situation. The next time you are with a large group of people ask for a show of hands of how many of them left their last job because of a bad boss.

  • Statement: A good interviewer can determine if a person is a “fit” for an organization.

  Reality: We have known for a very long time that interviewers can actually diminish the ability to predict whether someone will succeed in an organization. An interviewer makes judgments that are often not based on job relevant characteristics.

  • Statement: Lie detector tests can determine if someone is lying and can be useful in making hiring decisions.

o   Reality: The evidence that lie detectors actually work and can determine if someone is lying is not there. And it is absolutely for certain that people with low affects can lie to lie detectors and get away with it. Lie detectors work on the notion that someone telling a lie will become more stressed and emotional and someone telling the truth will remain calm. The reality is that someone, even an innocent person, hooked to a lie detector and being asked about crimes will become stressed. (Generating false positives.) You might as well tie the person to a log and throw them in a river. If they float they are guilty and should be executed. If they sink and drown they are innocent, but unfortunately still dead.

  • Statement: Money doesn’t motivate people on the job.

o   Reality: Money is a great motivator (ask those on Wall Street). Money tends to show up on statistically generated lists of drivers of job satisfaction when people perceive themselves are being paid unfairly. When they perceive themselves as being paid fairly for the work they do, it tends to diminish in importance. People who claim money is not a motivator often seem to be people whose job it is to keep employments costs down.

  • Statement: It is good to regularly reorganization a company. It keeps people sharp; it keeps them on their toes.

  Reality: Organizations that regularly reorganize are consistently having people learning the ropes of new positions. In several studies it has been shown that better performance is achieved by people who have been in positions for longer periods of time then by people who are switched from job to job.

  • Statement: In business downturns, laying-off people is the best course of action.

o   Reality: If you can’t afford to pay people you need to get your costs down or you cease to exist. However, there is a good deal of evidence that shows that organizations that resist layoffs in down-cycles outperform as the economy recovers.

  • Statement: Women are more risk adverse than men, so if a job requires risk taking women are not a good fit.

o   Reality: It is pretty easy to find women who are more risk tolerant than many men. This is bias pure and simple and based on stereotypes.

Many of these statements are what Paul Krugman, the Nobel winning economist and NY Times columnist calls “Zombie Ideas”. Zombie ideas are statements that should have been killed by the evidence but refuse to die. From my perspective the field of Industrial Organizational Psychology, which is often concerned about publishing in scientific journals, (not that there is anything wrong with that), has a lot more work to do in getting our knowledge out into the mainstream and accepted.

© 2014 by Jeffrey M. Saltzman. All rights reserved.

Visit OV: www.orgvitality.com

Written by Jeffrey M. Saltzman

June 13, 2014 at 6:53 am

Drive to Work and Social Safety Nets

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Presentation to
High Level Conference of the Economic and Social Council, United Nations
July 9, 2012

What do we know about what drives people to work, to contribute to groups or organizations to which they belong? It turns out to be quite a bit. Beyond subsistence, one key component of what drives people to contribute through work is the need that people have to feel that their life, their existence is of value, that it has meaning. Humans, by-and-large, have a strong desire to feel valued, and part of what drives that sense of being valued is belonging to and contributing in a meaningful fashion to societal groups.

Societal groups, be they for-profit companies, charitable organizations, governmental organizations, religious organizations, sports teams, nation states or neighborhood beautification committees are all simply various types of organizations to which we belong. And certainly it is possible to belong to multiple kinds of organizations simultaneously.

That feeling of “being valued”, of being considered a worthwhile member of an organization is driven by the interactions that individuals have within the groups to which they belong and how members are rewarded by those groups for their contributions. Rewards at for-profit organizations for instance, involve salaries and bonuses, benefits, psychological recognition, opportunities for advancement, and developmental experiences.

Rewards for belonging to other kinds of societal groups may be very different. Almost 70 years ago, in the midst of World War II, President Roosevelt in his State of the Union proposed an Economic Bill of Rights, providing for a strong social safety net stating that true individual freedom cannot exist without economic security, independence, and that political rights, as characterized by the initial Bill of Rights, are inadequate to assure us equality in the pursuit of happiness. Among the rights included were:

• The right to a useful and remunerative job in the industries or shops or farms or mines of the nation;
• The right to earn enough to provide adequate food, clothing and recreation;
• The right of every family to a decent home;
• The right to adequate medical care and the opportunity to achieve and enjoy good health;
• The right to adequate protection from the economic fears of old age, sickness, accident and unemployment;
• The right to a good education.

Many of these economic rights and rewards are achievable when people gain decent employment. But one question that arises is if a social safety net is provided, regardless of employment status, does it affect people’s drive to work? A partial answer to that can be found by examining how satisfied people are when reporting themselves to be over-worked or under-worked on their jobs.

First a preliminary question. If you survey a cross section of employees from within a country, are the findings generalizeable or predictive of broader conditions within that country? A test of this was undertaken from June, 2008 to October, 2009 by surveying quarterly, 16,000 people across the 12 largest global economies using an index called Employee Confidence which I developed. In a nutshell, Employee Confidence examines two aspects of employee attitudes, confidence in their respective organizations and confidence in their personal situation.

By treating countries as large organizations, with each country’s respective head of state filling the role of CEO, research techniques such as survey linkage can be applied to entire countries. This approach allows you to “link” attitudinal data from employees to measures of performance at the country level, such as national or state unemployment levels and GDP growth, among others.

Perhaps not surprisingly, the results we would expect to find at an organizational/company level also apply when you sample a representative cross-section of citizenry and look at country-level performance indicators. For example, within the USA, for one over-sampled iteration, each state was treated as an organizational unit. Comparisons of citizenry attitudes by state on the Employee Confidence Index to unemployment levels by state showed that Employee Confidence was a leading indicator of what unemployment levels would be within that state the following month.

In other words, the strongest relationships found were between Employee Confidence attitudes now, and what officially reported state unemployment levels would be 1 month from now. This relationship was marginally stronger than the relationship between current attitudes compared to the previous month’s unemployment levels and current attitudes compared to current unemployment levels.
Additionally at the country level, Employee Confidence was found to be strongly related to change in GDP growth during this timeframe, with employees in India, Russia, China and Brazil achieving top scores and employees in Japan, Italy, France and Spain scoring the lowest. The rank order correlation was found to be .87 between Employee Confidence at the country level and GDP growth.

This would seem to give some indication that asking a cross section of employees about their levels of Employee Confidence might be a leading indicator of whether unemployment levels among citizens and potentially other economic metrics such as national GDP were heading upwards or downwards in the near term.

Now, given that the evidence suggests that certain citizenry attitudes at a country level can be used in a similar fashion to employee attitudes in predicting organizational performance, we can begin to draw some conclusions using employee survey data not only about “people at work” but also about “people as citizens”.

For instance, one study I undertook looked at the relationship between workload and satisfaction. Employees who consider their workload to be “about right” tend to be the most satisfied with their jobs, while those who say they are underworked are less satisfied than employees who complain of being overworked.

This study examined the level of job satisfaction of more than 800,000 employees at 61 companies worldwide. Of the companies surveyed,
• 75% had operations in North America,
• 11% had operations in Europe,
• 14% had operations in Asia.

Employees participating in the survey were asked to rate their overall satisfaction with their jobs, and their perceptions of their workload. Respondents who described their workload as “about right” rated their job satisfaction at an average of 73 percent favorable, while employees who said they had “too much work” rated their satisfaction level at 57% favorable. By contrast, those who said they had “too little work” had the lowest average job satisfaction rating of 32% favorable.

By slicing the data geographically we can examine how workers in different parts of the world felt about their workloads and how that relates to job satisfaction. Employees in North America who said they had “too little work” had an average job satisfaction rating of 36% favorable, whereas European workers in this category had a satisfaction rating of 12% favorable, and Asian employees a rating of 13% favorable.

Job Satisfaction and Perception of Workload are not related to the degree in which a society spends on Social Safety Nets. For instance, according to the OECD in 2012 the USA will spend 20% of GDP on social spending, while in Europe, in general, greater amounts are spent on social safety nets, and in Asia, with the exception of Japan, which will spend 23%, spending on social safety nets is generally lower.

Some conclusions that can be drawn by looking across these studies include:
• Given the linkages found between country level performance metrics and employees attitude data, there does seem to be generalizability between employee attitudes at work, and given a large enough and a representative sample, citizenry attitudes at a country level.
• And while we did not survey people working in sweatshop-like conditions, people tend to be most positive when they have about the right amount of work to do, but on a whole, prefer being busy over not having enough to do. One could surmise that among people who are not given enough to do, there is a tendency to feel that their contributions are not valued.
• The notion that creating societies with strong social safety nets, as has been done in some European countries to a greater extent than in the USA, diminishes the desire to work does not bear out.

So where do statements such as, “those lazy people will find jobs once their welfare checks run out”, come from? There is a tendency for humans to make decisions and draw conclusions representing their world-view based on heuristics, or rules of thumb and to consider only evidence that supports their point-of-view. The down side of this evolutionary derived shortcut to speedier human information processing is that it can play into stereotypes, bias and bigotry.

Let’s apply some evidence-based decision making to the notion that by having a safety net that societies are creating benefits that are so generous that those who are unemployed will have less of a desire to work.
• The evidence suggests that the majorities of people are happy when working, and in fact are happier when they feel that they have too much to do rather than too little.
• The evidence suggests that in societies with strong social safety nets that there is no diminution of satisfaction for the majority of workers that the work itself brings.

It is possible to go into the general population and at the extremes of the distribution find individuals who fit the worst-case scenarios and stereotypes of people who prefer not to work, living off of social safety nets, but they are exceptions rather than the rule.

In sum, based on a review of multiple databases that include both the private and public sector, the evidence is clear, most people want to work, to do a good job at work and want to feel that they are contributing in a meaningful fashion and this is independent of geography and the type of social safety net that is in place.

© 2012 by OrgVitality, Jeffrey M. Saltzman. All rights reserved.
Visit OV: http://www.orgvitality.com

Desire to Work, Unemployment and Social Safety Nets

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Some of the research I have done over the last few years treats countries as nothing more than large organizations, with each country’s respective head of state filling the role of CEO. This approach has enabled me to apply the research techniques developed over the last few decades, such as linkage, on measuring organizational performance to entire countries. Not surprisingly, the results we would expect to find at an organizational level, say a public or private entity within a country, also applies when you sample a representative cross-section of citizenry and look at country-level performance indicators such as GDP growth or corporate bankruptcy rates. I developed an index a good number of years ago called Employee Confidence, and since June 2008 was measuring it quarterly on 16,000 people in the 12 largest global economies.

Within just the USA for one study, I treated each state as the organizational unit and made comparisons of citizenry attitudes to unemployment levels, and by looking at the change in attitudes over time, was able to get some indication of whether the citizenry attitudes were a leading indicator of what unemployment levels would be or a lagging indicator. The largest correlations between citizenry attitudes and unemployment came when linking together attitudes at time 1, with the following month’s unemployment level. In other words, the strongest relationships found were between attitudes now and what officially reported unemployment levels would be 1 month from now. This relationship was marginally stronger than the relationship between current attitudes compared to the previous month’s unemployment levels (postdictive – unemployment levels, the month preceding the measurement of the attitudes), current attitudes compared to current unemployment levels (concurrent points in time), and current attitudes compared to unemployment 2 months out. This would seem to give some indication that asking a cross section of citizenry about their levels of Employee Confidence might be a leading indicator of whether unemployment levels and potentially other economic metrics were heading upwards or downwards in the near term, and this leading indicator can be available before officially reported economic figures.

I recently co-authored with Scott Brooks, a book chapter, appearing in Going Global, for the Professional Practice Series, for the Society of Industrial and Organizational Psychology which documented some of the major findings from this body of research.

Now, given that the evidence suggests that certain citizenry attitudes at a country level can be used in a similar fashion to employee attitudes in predicting organizational performance we can begin to draw some conclusions not only about “people at work” which has been done countless times, but about “people as working or unemployed citizens”.

For instance, a good number of years ago I looked at the combination of workload and employee satisfaction or morale in the workplace. Here is an excerpt published in Executive Viewpoints on that work. “Employees who consider their workload to be “about right” tend to be the most satisfied with their jobs, while those who say they are underworked are even less happy than employees who complain of being overworked”.

“The study looked at the job satisfaction levels of more than 800,000 employees at 61 companies worldwide. Of the companies surveyed, 75% have operations in North America, 11% have operations in Europe, and 14% have operations in Asia. Employees participating in the survey were asked to rate their overall satisfaction with their jobs, as it relates to their workload, on a 100-point scale. Respondents who described their workload as “about right” rated their job satisfaction at an average of 73, while employees who said they had “too much work” rated their satisfaction level at 57. Those with “much too much work” had an average satisfaction rating of 42. By contrast, those who said they have “too little work” rated their job satisfaction at 49, and those who complained of having “much too little work” had the lowest average job satisfaction rating, of 32. The survey also identified variations in the way workers in different parts of the world felt about their workloads.

“Results showed that employees in Europe and Asia were about three times less likely as North American workers to say they were satisfied with having “much too little work.” Employees in North America who said they had “much too little work” had an average satisfaction rating of 36, whereas European workers in this category had a satisfaction rating of 12, and Asian employees a rating of 13. The study also showed that employees in Europe and Asia who claimed they have “much too much work” were somewhat less satisfied with their jobs than their counterparts in North America. While North American employees who said their workload was much too heavy had an average job satisfaction rating of 44, European and Asian employees with “much too much work” rated their job satisfaction at 34 and 25, respectively.”

Some conclusions that can be drawn looking across these studies include:

  • There is some generalizability possible between employee attitudes at work, and given a large enough and a representative sample, citizenry attitudes at a country level.
  • People tend to be more positive when working productively and on a whole would rather be working harder than not having enough to do. When they do not have enough to do, either at their employer or when unemployed, there is a tendency to feel that their contribution is not valued either by their employer or society.
  • The notion that creating societies with strong social safety nets, such as unemployment insurance, as has been done in some European countries to an even greater extent than in the USA, diminishes the desire to work does not bear out.

There is a tendency for humans to make decisions and draw conclusions representing their world-view based on heuristics, or rules of thumb. The down side of this evolutionary derived shortcut to speedier human information processing is that it can play into stereotypes and even bias and bigotry if one is not careful.

And there is a tendency on the part of organizations to also simplify their need to process information, which requires an expenditure of energy (i.e. resources) by creating rules which are broadly applied to those who reside within the organization. Unfortunately, these rules are often derived to control the outliers in the organizational distribution, the worst case scenario, rather than the vast majority who are in the “fat” part of the distribution.

Lets apply some evidence-based decision making to the notion that by extending unemployment insurance, we as a society, are creating benefits that are so generous that those who are unemployed will have less of a desire to work.

  • The evidence suggests that the vast majority of people are happiest when working, and in fact are happier when over-worked rather than underworked.
  • The evidence suggests that in societies with strong social safety-nets that there is no diminution of the happiness and satisfaction for the majority of workers that working and working hard brings.

It is possible to go into the general population and at the extremes of the behavioral distribution find individuals who fit the worst-case scenarios of people who do not want to work and would rather collect money from the in-place social safety nets, but they are nowhere near what the majority of us want and what makes most people feel good about themselves. Based on a review of multiple databases that include both the private and public sector, the evidence is clear, most people want to do a good job at work, want to feel that they are contributing in a meaningful fashion, would rather be overworked rather than underworked and their frustration levels and eventual withdrawal from the organization can be driven by their inability to do so.

© 2010 by OrgVitality, Jeffrey M. Saltzman. All rights reserved.

Visit OV: www.orgvitality.com

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