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What's Keeping You Up?

New survey by Human Resource Executive® finds HR leaders' stress levels have risen dramatically since the recession began. CHROs chime in on the reasons why.

Thursday, September 2, 2010
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These are the times that try HR leaders' souls.

Morale at many companies has plummeted since the recession began. Top talent is on the verge of jumping ship. Relentless downsizing has hurt -- often significantly -- the ability of organizations to achieve their goals and objectives.

But, though HR is often held accountable for these failings, there is only so much its practitioners can do about them. And that may explain why nearly 80 percent of HR leaders report their level of stress has gone up during the past 18 months, according to a new survey by Human Resource Executive® entitled "What's Keeping HR Leaders Up at Night?"

The survey found widespread concern about the ravages of the recession -- including the impact on HR leaders themselves. A third of the 802 HRE readers who took the online survey reported that their level of stress has increased "dramatically" -- a strong word that may speak volumes about the state of HR today.

"When employee engagement and morale drops, if you're an HR professional, at the end of the day, people are going to associate it with you because that's your role," says David Rodriguez, executive vice president of global human resources at Marriott International, based in Bethesda, Md. "And the less an HR leader is able to influence this, the more stressed he's going to be."

Rodriguez, one of five HR executives we asked to share their thoughts about the survey results, says morale at Marriott has remained high through the recession, and he personally has not felt greater stress since it began. But, he says, it's to be expected that -- given the impact of the downturn -- many HR leaders are having a difficult time these days.

The survey paints a bleak picture. Only 30 percent of the HR leaders said employee engagement and morale were strong at their companies. More than half said they were worried about losing talent as the recovery takes hold.

Neither finding, of course, will come as much of a surprise. Many workers fear for their jobs, and those who have survived cutbacks are often working under difficult conditions -- doing the jobs of several people, for example, and making do with fewer resources. To add to the pain, many employers have frozen wages and cut back benefits.

HR leaders know they have their work cut out for them.

Asked to name the most significant challenges facing HR today, 45 percent of the survey respondents cited the need to keep employees engaged and productive, followed by the need to retain key talent as the economy recovers (34 percent) and the importance of developing leaders (33 percent).

John Murabito, executive vice president of human resources and services at Philadelphia-based CIGNA, says keeping employees engaged will probably be HR's top priority through the recession's end and into the impending recovery.

"Employees are very focused on keeping their jobs and, at the same time, they can be distracted by how the company is doing and how the country is doing," he says. "It can cause angst."

Elease Wright, senior vice president of human resources at Aetna, in Hartford, Conn., suggests leadership development ranked relatively high in the survey because HR leaders recognize that good leaders are essential to employee engagement.

At the same time, several HR executives interviewed suggested that the priorities that ranked highest in the survey -- engagement, retention, leadership development and others, such as aligning people strategies to business objectives and driving culture change -- reflect larger trends in HR that began well before the recession. Issues such as training, union avoidance and improving customer service, which ranked low in the survey, have taken on less importance, regardless of the economic climate.

"This is the nature of HR today," says Murabito.

Stressors and Strategies

Still, there was plenty in the survey to keep HR awake at night. More than half of the HR leaders reported that downsizing has hindered their organizations' ability to achieve its goals and objectives. And 11 percent said that ability was "significantly" hindered.

The HR leaders interviewed suggest that at least two factors may have prevented downsizing from having an even greater impact. Some companies, they say, may have begun the recession with an excess of employees, and so downsizing didn't hurt productivity. And generally, of course, companies need fewer employees as demand for their products or services goes down.

"Many businesses have been aligning resources to the market opportunities," says Rodriguez.

HR itself has been no stranger to the axe. Nearly a third of HR leaders reported that their departments were cut during the recession, and half said they don't have enough staff to handle the workload. This does not bode well as the country heads into a recovery.

Rodriguez notes that, even before the recession, trends such as globalization and restructuring were adding to HR's responsibilities -- though there was no commensurate increase in staffing. Now, after HR cutbacks at many organizations, the problem has been exacerbated. "There is a heavier workload than in the past, and people are working harder than ever," he says. "This is the new normal for HR, and across the organization."

And that means it's up to HR and other leaders to be more supportive of employees. "We ask people to do more, and what they want in return -- and what we owe them -- is to take the obstacles out of the way," says Rodriguez. "Leaders should be asking, 'How can we make things easier?' "

That may also help explain the chief methods HR leaders are using to keep employees happy.

Sixty-three percent of respondents said that, to boost employee retention over the next year, they plan to increase employee communication. That outpaced common best practices such as training and development (55 percent), assisting employees in career development (45 percent), and improving work/life balance (30 percent).

More resource-intensive measures, such as increased compensation (21 percent) and enhanced employee benefits (16 percent), were far behind.

This may be largely a matter of economics -- the cheapest approach may be to simply talk to workers.

"Companies are struggling to put money into benefits, compensation, pensions -- all the things they have done over the years to retain people from a financial standpoint," Murabito says. "We don't have those tools at our disposal now, so we have to ask, 'What is the best tool that we do have?' And it's showing people, on an individual level, how they're valued in the organization, and on a macro level, how they help their organization make a difference in society."

John McMahon, senior vice president of Melville, N.Y.-based Arrow Electronics, a global distributor of electronic components and solutions, echoes the sentiments of many HR leaders who maintain that communication is essential in today's economy.

"This is one of the critical components of employee engagement," he says. "We have to be open and out front about what we need to do to save as many jobs as possible. We have to talk about the good, the bad and the ugly."

Wright, of Aetna, says she believes the survey respondents ranked employee communication as the top retention measure because "it probably has the potential to have more of an impact than any of the other things listed. Communication is important under any circumstances."

HR's inability to take immediate action to tackle organizational challenges these days is a key reason the survey found so much stress in the profession, according to the HR leaders interviewed.

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HR executives "may not have the resources to do what needs to be done, and that causes stress," says Ron Tepner, vice president of human resources at Bridgestone Retail Operations in Bloomingdale, Ill. "You can talk about leadership development, but where do you get the resources and internal people to pull it off?"

That said, however, Tepner adds, Bridgestone is actually doing pretty well, as is his own stress level. "I give stress," he says with a laugh -- adding that he fully understands why so many of those surveyed did say they were affected.

Profession Still Satisfies

Tepner does note, however, that in responses to two other survey questions, HR leaders seemed more satisfied with their jobs. Asked to rate their personal level of work/life balance, 70 percent gave either a positive or neutral response. And asked whether they would recommend a career in human resources to one of their children, or the child of a relative or friend, just 14 percent said no.

"If only 14 percent wouldn't recommend a career in HR, how much stress is there?" asks Tepner.

Rodriguez offered another take on those responses. HR leaders are willing to recommend the profession because "they know these roles are going to be meaty -- that from middle manager to senior manager in HR, these are going to be fascinating jobs because of the kinds of things you get to do in your work."

Wright suggests that the apparent discrepancy between the high levels of stress and the satisfaction with work/life balance may be because many HR leaders are good at separating their work from their home life.

And, she says, while HR leaders may feel more stress because of the recession, challenges they face in a recovery and other factors -- such as new legislation and increased scrutiny from outside agencies -- the role of HR leader tends to be stressful in general.

HR leaders, she says, "are often the ones in the thick of things because they're facilitating change."

Still, she says, high stress levels in HR could be an indication of high stress throughout the organization -- and so should be watched closely.

"The HR person is the canary in the coal mine," says Wright.

CIGNA's Murabito says that, when an HR leader's stress is high, he or she should examine whether leaders in other functions are similarly beleaguered. "Sales and finance may say the same thing," says Murabito. "We need to be more concerned about the level of stress in the organization in general."

McMahon of Arrow offers still another reason for greater stress among CHROs, aside from the recession or recovery.

"The HR function and the CHRO are being asked to be more a part of the business, and they're being asked to deliver more than in the past," he says. "A lot of people in our profession are not equipped or prepared, or [even] want to be in at that level of the business, particularly when there is cost-cutting, and HR is being asked to do more with less."

Another key finding of the survey: Nearly 80 percent of HR leaders said they did not anticipate making any changes to their organizations' retirement plans in the next year. Wright says she finds that somewhat surprising, considering that companies may need to adapt their retirement plans to accommodate today's more mobile workers.

"Companies need to be thinking about how to be more efficient in attracting and retaining employees, and that's what benefit plans should be doing," she says.

The survey also seems to throw water on the longtime fear that baby boomers will soon be leaving the workforce, creating an alarming talent gap. Only one-third of survey respondents said they expected baby boomers to retire in greater numbers as the recovery takes hold. One reason, of course, is that many baby boomers have lost much of their next eggs as their 401(k) plans have suffered, and need to work longer.

Still, McMahon says, many baby boomers aren't leaving because their generation finds meaning in being productive. "There's a desire to stay in the game," he says.

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