- The labor market remains unsettled, and employees are quitting jobs at record rates.
- Employees are more committed and engaged when they work for managers who trust them.
- In contrast to transactional psychological contracts, covenantal relationships increase employee loyalty.
- Managers should look for ways to reduce employee loneliness, which has only increased during the pandemic.
It is a new year, but whether you refer to it as the “great resignation,” “great reshuffle,” or “great reallocation,” the labor market remains unsettled. Quitting is at record high rates, and many employees are retiring early, starting small businesses, or moving on to organizations that offer more flexibility, more meaningful work, or more equitable pay and benefits.
This presents a challenge for managers who seek to retain their employees and keep them engaged at a time when many organizations are already short-handed, and their workforce overextended. Of course, there are no easy, quick-fix solutions for a problem of this magnitude. But recent headlines suggest that many organizations must resolve to abandon practices that tend to push employees away and to embrace practices that will contribute to a more attractive workplace for employees and better address their needs.
Here are three resolutions worth considering:
1. Convey Trust.
Over 60 years ago, Douglas McGregor suggested that there are Theory X managers and Theory Y managers. Theory X managers believe that employees are untrustworthy and dislike work, which means it is critical to control, threaten, and continually monitor them to ensure their work will be completed. In contrast, Theory Y managers subscribe to the view that employees are generally trustworthy, willing to accept responsibility, capable of self-direction and self-control, and often derive satisfaction from their work.
In spite of evidence that a Theory Y mindset is a more thoughtful and effective way of managing employees, Theory X practices are still prevalent in many organizations. For instance, a recent article in The Wall Street Journal noted that when Tiffany & Co. called corporate employees back to its headquarters, their badge swipes were monitored to ensure that employees were in compliance (and to investigate further if they were not).
More generally, the surveillance of employees working from home is increasingly common since the start of the pandemic, and sometimes this monitoring occurs without their knowledge. Although employees may not always react negatively to being monitored, especially when they are aware and understand the need for surveillance, such practices can undermine perceptions of fairness and trust.
The larger issue, though, is that adopting a more trusting view of employees is long overdue and especially critical now; indeed, employees are more productive, more helpful, and less likely to quit when they work for managers who trust them.
2. Develop Covenantal Relationships.
As I have noted previously, too many employers have developed transactional relationships with their employees that are based largely on economic exchange. This is unfortunate given that many employees are looking for a relational psychological contract, which is characterized by social exchange, involving mutual trust and consideration.
More specifically, employers should seek to cultivate what researchers describe as a covenantal relationship with their employees—a specific, deeper relational contract where there is a mutual promise between employees and employers to cooperate and stay together for the benefit of both parties.
Research has shown that workers are more likely to perceive a covenantal relationship with their organization when they have meaningful and satisfying work; are given autonomy and regular feedback; and believe their organization values quality, innovation, cooperation, and employee participation.
Studies have also found that a covenantal relationship is also more likely to develop when employees believe that they are working in an organization with an ethical work climate that emphasizes social responsibility and cooperation. Importantly, covenantal relationships lead to higher levels of employee loyalty to the organization, which is likely to manifest in the form of higher engagement and lower turnover.
Of course, by definition, covenantal relationships are a two-way street, and organizations must hold up their end of the bargain to elicit this kind of loyalty. But organizations that do should be better positioned to navigate turbulent times like the one we are experiencing now.
3. Reduce Workplace Loneliness.
Even before the COVID-19 pandemic, Surgeon General Vivek Murthy had described loneliness as an epidemic, with important implications for the workplace. Of course, employees can feel lonely even when working alongside their coworkers, but with employees increasingly working from home, loneliness is even more prevalent.
Research has not only found that loneliness adversely affects physical and mental health, but it also indicates that lonelier employees find it difficult to connect with their colleagues and their organization, which results in lower job performance.
Of course, the organizational environment often influences how lonely people feel at work. Indeed, almost 40 years ago, Jerry Harvey noted that “the anguish of ‘corporate life’ stems from the competition, loneliness, and alienation that individuals often feel in the midst of a crowd that, ironically, was assembled for the purpose of cooperation.”
He advocated for the elimination of zero-sum reward practices that pit employees against each other (e.g., forced ranking performance evaluations) and encouraged companies to reward employees for cooperative behavior. Managers can also fight loneliness by devoting more time to one-on-one interactions with employees and by creating more opportunities for employees to connect.
Further, lonely workers tend to feel less isolated when they work in a team that displays caring and compassion; however, being part of a team that displays hostility and irritation can make employees feel even less connected. Therefore, fostering a supportive team culture is another avenue for combatting workplace loneliness.
The labor market remains unsettled, and employees continue to seek better situations. Recent headlines, though, suggest that many organizations are falling short in their efforts to create environments that will attract and retain workers. By resolving to abandon a Theory X mindset and to convey trust, develop covenantal relationships with employees, and reduce workplace loneliness, managers can take evidence-based actions that may not only help them now but also better position them for a post-pandemic world of work.