3/4 of Americans Fear Losing Jobs Amid Looming Recession

With many economists warning of an impending recession, along with inflation at a 40-year high, it’s no surprise that around 80% of American workers fear losing their jobs.

Research carried out by US staffing services company  Insight Global, reveals growing concern among full-time employees at all levels about job security, financial preparedness and communication transparency from company leaders. With the ‘Great Resignation‘ in the rearview mirror, the ‘Great Apprehension’ brings to light a widespread sense of job insecurity.

THE GREAT APPREHENSION

With the first half of 2022 focused on The Great Resignation, the latter half introduces The Great Apprehension. This is where many American workers are hoping for the best, but planning for the worst. The survey results found that:

• 78% of employees are worried about losing their job if there is a recession. Almost a quarter (23%) of American workers indicating they are extremely worried about losing their jobs.
• Managers (49%) more often than non-management employees (34%) indicated higher levels of anxiety regarding losing their job if there is a recession.
• 56% of American workers say they don’t feel financially prepared for a recession; or they don’t know how they would prepare for a recession, with women feeling the most unprepared at 64%.

RECESSION FEARS

For those adults, especially older Millennials who were working during the Great Recession of the mid-to-late naughties, the thought of another recession triggers professional fears.  

• Among American workers who were employed when the Great Recession began, more than half (53%) say they still feel anxious about job security or say the fear of being laid off is often in the back of their minds. These fears are even more common among Millennials (60%); many of whom were in the early stages of their careers during the Great Recession.
• Only a quarter of American workers employed during the Great Recession (25%) say they have several backup plans prepared should they be laid off.

RECESSION-LED LAYOFFS

The survey’s findings signal that the ball may be landing in employers’ courts, with nearly nine out of 10 managers in the US stating they would be likely to lay off employees should there be a recession. And employees’ growing concerns for their jobs are making them more willing to take a pay cut to avoid a potential layoff.

• 87% of managers say they would be likely to lay off employees should there be a recession.
• More than half (54%) of American workers would be willing to take a pay cut to avoid being laid off if there were a recession.
• More working men (63%) than women (46%) would be willing to take a pay cut to avoid being laid off.
• Over half (52%) of US staff do not feel their job is recession-proof or are unsure if their job is recession-proof.

ALTERNATIVES TO LAYOFFS

“It’s unfortunate we’re already seeing some companies turn to mass layoffs because I believe layoffs should be the absolute last resort,” said Bert Bean, CEO of Insight Global. “Instead, I encourage leaders to consider other solutions; such as building a plan that avoids layoffs and helps you grow through a recession. Get your employee base executing on that, because when you bounce back from a recession, you’ll need your people more than ever.”

When the Covid-19 pandemic began in 2020 and it took its toll on the global economy. Insight Global committed to a “no layoff” policy, which Bean says it will continue in the event of another recession. “I realise not all leaders have the will to do this, but if you do, you will be shocked and amazed by the performance of your people when they feel this kind of safety and loyalty,” said Bean.

TRUST & CONFIDENCE

Workers are confident in their leadership’s ability to lead them through a recession; however, trust in communication is lacking. 

• Nearly half of employees (47%) do not trust that their employer would adequately communicate its plans should there be a recession. Additionally 66% of managers do not trust that their senior leadership would adequately communicate its plans should there be a recession.
• Two-thirds of managers are confident (67%) that the leadership at their organisation could lead their organisation through a recession. And, 58% of employees in non-managerial positions indicate the same levels of confidence in leadership.

“As we’re seeing in the headlines, even major companies that have experienced astronomical growth over the last several years are not immune to financial challenges,” added Bean. “If a recession strikes, I’d hate to see that result in more layoffs. If your company hasn’t established a recession plan yet, do it now. Communicate it with your employees and start acting on it.” Learn more about the survey results here. 

New research has highlighted the significant impact of the spiralling cost of living crisis on employees’ home and work life. Click here to read more.