For Americans Facing Job Loss, Financial Strains Only Scratch the Surface
NEW YORK, April 8, 2020 /PRNewswire/ -- In the week ending March 28, over 6.6 million people filed for unemployment – the most initial jobless claims in U.S. history. The financial consequences of unemployment are extensive – for these workers and for the country. But it's worth pointing out that the effects of job losses are not solely monetary.
Research by Stephan Meier, the James P. Gorman Professor of Business at Columbia Business School shows that jobs provides purpose, a feeling of competence, the sense of being useful and the connection to other people that cultivates a sense of belonging and community. Whether someone works behind a bar, as an actress, or as a building maintenance person, a job gives – beyond a paycheck – a feeling of being useful, mastery of a craft or skill, and structure in the day. Thus, when someone loses a job, they lose much more than crucial income and benefits like health insurance. They lose a source of fulfillment and purpose – meaning that these newly-unemployed workers will be suffering much worse than financial strain.
While policymakers can help with loss of income, they are not well equipped to help compensate for loss in meaning. Non-profit organizations and volunteer opportunities, on the other hand, might be able to provide short-term meaningful tasks for those facing unemployment. Writing letters to lonely and isolated elderly, or other tasks that can be done at home but have a purpose, might provide some compensation for the loss of meaning at work. The toll of unemployment during this pandemic-fueled recession will be mental and emotional in addition to financial, and it's worth considering the scars that will leave when the economy is up and running again.
The pandemic is also reshaping the structure of work, transitioning jobs from communal offices to days spent at home behind a computer. A non-trivial aspect of the American economy is having in-person interactions with others. Even with the security of a steady paycheck, those working remotely may be feeling a lack of motivation and incentivization as well. Unfortunately, video conferencing or house-party social work events cannot replace real-life interaction with coworkers. Companies and policymakers will have to address how productivity might suffer during this phase, recognizing the mental toll on employees.
The longer the coronavirus lockdown lasts, the higher the psychic cost will be for millions who are missing the meaning that they gain from work. But all is not lost. The coronavirus shut down could help workers to gain a new appreciation of personal interactions in our workplaces – potentially increasing our productivity and fulfillment upon our return. What's more, firms are likely learning how to optimize their workflow using technology, while employees are gaining sense of autonomy over the structure of our days – potentially resulting in healthy new habits when we're back in the office. The coronavirus pandemic may increase meaning at work in the long term.
But until then, companies and employers strategizing how to preserve mission and revenue and, policymakers looking to provide critical relief to millions of newly unemployed Americans, must be mindful to incorporate compassion, empathy and acceptance as they plan for the future of their workforce.
To learn more about the cutting-edge research being conducted at Columbia Business School, please visit www.gsb.columbia.edu.
SOURCE Columbia Business School
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