Critical Discussion of view Employee commitment during econonic Downturn can assured by steady income INTRODUCTION As we all know

recession is the time of the economic downturn. It impacts not only organizational employers and employees but also day to day life of a common man . Recession entered with job insecurity,job scarcity, joblessness and lots of other chronic consequences. Lets ha e a glance ,what is this Recession. RECESSION !ational "ureau of #conomic Research cites that $A significant decline in economic acti ity spread across the economy lasting more than a few months% is called recession. &!ational "ureau of #conomic Research "ureau,'(()*. +he scenario can be e,plained by recent recession , as now a days there are scarcity of jobs in the market and job shedding in arious public as well as pri ate organizations. +his also create obstacles in indi idual employee-s personal, financial and professional growth in one organization . !ow the issue is that, the recession influences employee .s commitment, and can it be assured by steady income. "efore going ahead one must understand what is commitment / CO IT ENT who are committed to an

0ommitment is dedication to a particular organization, cause, or belief, and a willingness to get in ol ed. 1eople organization or effort truly belie e that it is important, and they show up, follow through, and stick with it &2arren,34)4*. 5yers and Allen &'((6* ga e their iew on three components of commitments they found the employee who $want to% stay in organization, they ha e attitude towards a target &the organization*,and the employees

who ha e $need to% and $ought to% they ha e beha ior to just stay in the organization 7ere we are talking about continuance commitment which is $need to% stay in a job during recession but it doesn.t insure long term commitment in the same job, that means after recession ,it will depend upon the positi e relationship , moti ation. 0ommitment is one of the biggest weapon to show loyality towards a organization ."ut it also depends upon the moti ational le el and situation,if a employee is not moti ated towards the work, he will enjoy his job for few days and then left the job. Ahmed et al. &'(3(* in a study looked at nurses working in #ngland and nurses working in 5alaysia. +aking cultural conte,t into consideration, the study showed a positi e correlation between intrinsic moti ation and commitment. 8uring the times of economic downturn people remain committed to the organization because of family commitments and need of security,they works hard and stay committed to meet their ends. 9ob insecurity is also a crucial reason, plus job scarcity in market also moti ates him to do the same job . +herefore, after cutting off income or steady income, their commitment remains positi e towards the organization . "ut there are multiple other factors that influence job satisfaction of an employee like relationship with employers, effecti e management , psychological contract, trust towards organization,loyalty,well renowned company etc. :ne of the biggest factor which has huge effect on the issue is type of employee ,whether the employee is working as semi skilled ; skilled ,middle le el or lower category,+emporary;permanent. A study done by 8e0uyper &'((4* also found that job satisfaction and organizational commitment were highly correlated with being a permanent worker in which type of large ; small organization. #mployee,s moti ation le el , needs and goals are also important for staying in the same organization .

RE!IE" O# $ITER%TURE "roadly in current situation it seems to be the correct statement. # ery body nowadays is scarred of loosing job and e eryone has financial and family commitments and after what is happening in #uro<zone, according to ""0 news, in =reece and >pain there is ?( @ unemployment rate among young adults of 3)<'? age group. In this period employer may think that if they pro ide the steady income to their employees the loyalty to the organization is assured as they ha e little chances of finding newer options elsewhere. "ut if we talk about highly and rarely skilled workers whose skills are in high demand e en in recession, the loyalty can ne er be assured by just income for them. 0lassic e,ample is !7> where it is difficult to recruit and retain high end medics like AA# consultants, child specialist, anesthetist and also skilled senior nursing staff, though it is a good job and income is secured. +he effects of the great recession towards job commitment of nurses, is polled by !ational 0ouncil of >tate "oards of !ursing in '((6 and '((4. +he study was performed on 336,'?6 registered nurses in '((4, where 4( percent of them began their work in hospitals and were e aluated in terms of job satisfaction and desire to stay at work. Results showed that nurses polled in '((4 claimed to ha e better working conditions and nurse<doctor links than their '((6 counterparts &"rewer, and Bo ener ,'(3'*. 5oreo er its a matter of fact that high skilled employees, are usually paid well and if they are happy to relocate they ha e better chances of personal and professional growth in those parts of world , where the affect of recession are less or limited. A study done by Ahmad et al.&'(3(* found support for the relationship between empowerment and job satisfaction an job commitment.

In a study by Lyons& '((6* says that there is not much difference between the commitment of pri ate or public or para public employees. 0onsequences of downsizing and restructuring , can be pro ed by a study done by 2orkpolis.com they reported that C(@ employees in 0anada eat their food on desk rather than going out for lunch to sa e time and this is all because of work load and downsizing. Increased workload as per employee , results in e,tra , long hours and increased stress, reduced the chances of staying committed to same employee for the longtime. &1rice,'((D*. +here is iew gi en by 2atson &344D* peak performance in short term requires significant le el of commitment, but this can be achie ed , when managers ensure employees for healthy longe ity . If it is lacking, the effects are insecurity and low moti ation . #mployment security is positi ely related to the employee.s long term commitment to the organization & 1ffefer,344)*. "ergeman &'((3* states that Eworkplace of today is one of increased workload and decreased job security and commitmentE.#mployees can also stay committed if they ha e confidence in there employer, but after seeing redundancy issues, the employees confidence le el is displaced and their trust is shaken. &1rice, '((D*. It is cited in a recent study by Liu &'(3C* that organizational trust is positi ely correlated to organizational commitment . A psychological contract , is also helpful in retaining employees ,it is a concept de eloped by Rousseau &344?* $the mutual beliefs, perceptions, and informal obligations between employer and an employee%.It is matter of fact that employees commitment depends upon, not only monetarily but psychological contract too. Feldhiem &3444*. It is stated by !iehoff,&'((3 * Erole of psychological contract helps in shifting, e,pectation of an employee from monetary demands to intangible demands such

asEtreatment of employees or degree of empowermentE..

%N%$&SIS %ND DISCUSSION "y re iew of literature,it is found that employee.s commitment towards organization , can be e,plained by 5eyers and Allen &'((6* +hree component model According to eyers and %llen '())*+ model t,ere are t,reecomponents of commitment 3. Affecti e commitment, which is called $want to% be committed '.0ontinuance commitment which is $need to% be committed C.!ormati e commitment which is $ought to% committed towards an organization 7ere it is found that during the time of recession ,commitment of employee is continuance commitment , $need to% stay in the job , rather than affecti e or normati e which is based on emotions and obligations. &5yers and Allen,'((G * "ut there are few psychologists >ollinger,etal. &'(()* according to them 5yers and Allen +hree<component model is more helpful in predicting turno er. >o they suggested #agly and 0haiken.s attitude<beha ior model from &'((G* they found that it is a better model for organizational commitment and it predicts arious other factors than beyond turno er. "ut still , 5yers and Allen model , is the leading model of organization ,because it ties three components all together &5owday, etal. &'((6*. It is clear by the +hree component model 5yers and Allen &'((6* that employee .s $need to% stay committed to a organization during the time of recession is crucial. 7e need job security, to support himself and his family , if he percei es that he can. t fulfill his needs , he feel dissatisfied and demoti ated. !ow lets discuss aslows .ierarc,ical T,eory'34?D*'%ppendi/ %

fig01+ it is the famous moti ational According to 5aslow in each human being, there is e,istence of fi e hierarchical needs, and e ery need has its importance in the hierarchy , if one need is satisfied other is dominant , the le el of hierarchy goes from lower le el to upper le el. 5aslow di ided the fi e needs into lower and higher order needs , lower order needs are physiological needs and >afety and higher order needs are social , esteem, self actualization, just ne,t to the basic needs. 8uring recession a employee needs financial safety and security to sustain his life and support immediate family and they are working hard ,If it is satisfied then ne,t le el of need is dominant , that organization beha e respect fully towards him , and during the time of economic downfall ,if the workers don.t ha e fear of loosing job they can contribute positi ely to the organization and stay long term committed to the organization. & 1ffefer,344)* then chances of lea ing organization is less in post recessional period. "ut %lderfer2s t,eory'13*3+ argued this iew of hierarchical theory by 5aslow , according to Alderfer hierarchy is replaced by #R= +heory is # is e,istence &physiological and safety need* , R is resistance &social and status need *,=rowth &self esteem and self actualization * according to Alderfer a employee focus on all three categories simultaneously there is no hierarchy , this says that a employee need for safety ,social acceptance and self respect all together .If a employee is committed towards the organization he must be treated like a human being not a machine , he must be gi en empathy and care,.=rdino ac &'(3'* stated $most of the companies preferred caring adaptations to cope with the recession4. so they can stay long .Increased workload as per employee , results in e,tra , long hours and increased stress, reduced the chances of staying committed to same employee for the longtime. &1rice,'((D*.

:ne of the theory called

cCleland t,eory of needs'1356+ ,e,plains that

e ery person has need of achie ement , need of power, and need of affiliation . It is theory which discuss , the basis that employees has need to power ,eg. if employers beha e nicely to him , in return he will stay committed , and also he has need of affiliation , friendly , trust and close relationship to employer. 9oaquin, &'(3C*, pro ed in a study,that employee.s is commitment percei ed by manager determine her;his le el of trust . !rooms e/pectancy t,eory '13*7+ '%ppendi/ 8 fig0( *it is based of effort,leads to good performance , performance leads to reward ,reward leads to fulfill personal goal. It is the chain of e,pectations, if any of then is unfulfilled job dissatisfaction occurs !ow how it is implied in economic crisis, as reward is not sure salaries are stagnant or cutting off , e ery employee is just working hard to stay stick to the job , because he is in secured of delayering , he has fear of he might be ne,t , his e,pectancy is just fulfilled by a little assurance from the employer that they will follow the psychological contract between employer and employe gi e him satisfaction like reward and fulfill his personal goal of respect and trust .!iehoff &'((3 * role of psychological contract helps in shifting, e,pectation of an employee from monetary demands to intangible demands such asEtreatment of employees or degree of empowermentE 9oaquin, &'(3C*, found in his study,that employee.s is commitment percei ed by manager determine her;his le el of trust. "ut on the other hand beha ior of management is like workers are just employee they ha e to work for sake of their safety as there is job scarcity in the market i. e. 5anagement using manpower by fearing them and employee needs are not fulfilled and e,pectations not addressed whene er recession will get o er they start quitting jobs. Hrooms theory also states that the

employee has percei ed alue and preferences. it means that during economic downturn if worker.s percei ed alue toward his job is to stay committed and work hard for the organization his preferences are to get a proper response need of affiliation , mutual understanding , between employer and employee . It is totally based on indi idual.s perception how a employee percei e his effort <performance<performance< reward < =oal. In recession its difficult to get reward on effort and performance , the employee.s work hard to stay in the job and in e,change of that they just need security and nice beha ior from employer as reward . & Lunenburg,'(33*. If employer breach their psychological contract they will become dissatisfied and they will also lea e job after recession gets o er. It is important to make close relationship ,to attract and retain high quality employees and to manage Ie,ibility.

1sychological contract, to e,plain psychological contract lets see Iceberg model '%ppendi/ C fig09+, it says that work and pay are abo e the water which come under written contract, but under the iceberg there is a big area which is hidden and comes under unwritten contract . #mployee inputs are performance, commitment, loyalty,management ,leadership and in e,change . #mployer rewards security , safety, training ,promotion,respect ,status etc. It is found that, Iceberg odel of psyc,ological contract employee side security and safety is dominant,and in employee side commitment , loyalty ,management is important. 7ence it is pro ed that if employees are secure in there jobs during this crucial period of recession , and management is helpful ,they will stay long lasting in the organization,and stay after recession too. 2atson &344D* peak performance in short term requires significant le el of commitment, but this can be achie ed , when managers ensure employees for healthy longe ity .

"ut it is also criticized by :o,ari window model; Luft &346C* it depends on leadership of manager,if they are autocratic and unfair, workers become job dissatisfied 9ohari window model also stress on constructi e communication , trust can be more helpful in this endea or ie retaining employees Liu &'(3C* that organizational trust is positi ely correlated to organizational commitment. =uest '((D , e,amined,a %nalytical framewor< ;for psyc,ological contract and employee relations,ip '%ppendi/ D fig07+;in which he showed that #mployee relations , are linked with promises,inducements and obligations,in response that a state of trust is de elop,which leads to moti ation and job satisfaction. "ut again it depends upon working hours and shifts of employee ,it also depends upon management they are supporting it or not and cultural issues are also there. If talk about !etherlands there is less freedom and laws are strict .It could be helpful in those countries where there is more freedom to act . CONC$USION It is to be concluded that #mployees job security and 0ommitment is positi ely correlated to employer.s; management.s attitude and strong psychological contract between them ie. employer and employee, during the time of recession and post recessional period. RECO END%TIONS %ND SU==ESTIONS

E >$O&EE2S >ERS>ECTI!E Communication #mployer must be more in two way communication. >ositive %ppraisals #mployers must try to cheer up employees by gi ing them good appraisals

and keeping them moti ated. "e and Our Company Instead of me and my in talks employer should use we and our company. it gi e in sensation of belonging and being part of company. #eeling of %ffiliation A simple smile on the face gi es positi ity to the workers which help them to relie e stress in their life due to recession and they feel managers are affiliated to them. Stress management 8uring the time of recession workload and stress is high , stress management workshop in the end of each month is helpful to manage stress. Trustwort,y attitude 2orkers or their representati e should be in ol e in decision making and workers should be informed of financial situation of firm. E >$O&ERS >ERS>ECTI!E #mployee.s must work hard so that company do well , during economic downturn and cooperate with employer in understanding current situation and help them in difficult decision. >o that when recession is o er both can reap benefit of the effort. RO$E O# .R Role of ethical 7R practices is ery important to moti ate employee in this period. Jnethical practices may retain employee during bad economic period due to fear of loosing job but once climate is better company will lose them and it will be difficult to replace them.

%>>ENDI? %

#igure 10

aslow .ierarc,icy of Needs >elf Actualization #steem >ocial >afety and >ecurity 1hysiological needs

%>>ENDI? 8

#igure (0 E/pectency T,eory 1 Individual Effort Organi@ational performance ( >ersonal rewards 9 =oal

10Effort->erformance Relations,ip (0 >erformance- reward Relations,ip 90Reward-personal goals Relations,ip

%>>ENDI? C

figure 90 Ice 8erg

odel Of >syc,ological Contract

"or< >ay
performance EAuity commitment security results safety loyalty respect management training leaders,ip promotion tolerance status Employee 2inputs2 Employer 2rewards2

%>>ENDI? D

#igure 7. %nalytical framewor< ;for psyc,ological contract Employee relations,ip

Outcomes 8ac<ground of #actors >olicies ConseAuences %ttitude 0ommitment

Individual
Age =ender #ducation #mploye< ment contract Organisation >ize ownership >trategy, Jnion 7R 1olicy >syc,ological Contract Reciprocal 1romises and :bligations State of >syc,ological Contract 8eli ery of 8eal +rust Fairness

9ob satisfaction
9ob moti ation >ecuriy

#mployee Relation ship

ConseAuences

Attendence >tay;Kuit 9ob 1erformance

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