Monday, June 21, 2010

Furloughs Theoretically Save Money but Empirically Cost Job Performance

Commentary
by Professor Tony Wheeler
Associate Professor of Human Resource Management

The current government budgetary picture in many states, if not most, and in many localities looks fairly awful. I won't focus on any particular state's budget woes because you can read any newspaper from around the country to get the details. Governments have three broad courses of action to close budget shortfalls: 1) Cut spending, 2) Increase revenues (e.g., taxes), or 3) A combination of choices 1 and 2. National, state, and local politics, obviously, affects the choices that governments will choose. As I discovered while doing research with a colleague, these political pressures even affect the research that nobody academics like myself attempt to conduct.

Especially when you want to understand the impact of furloughs on state employees.

For political reasons I cannot disclose in which state my colleague and I conducted our research, as my colleague, who collected the data, had to agree state anonymity. He also received a phone call from a lawyer in the DOJ of the state where we collected the data telling him to stop data collection and consult a university lawyer (a.k.a., cease and desist). So much for "academic freedom," human subjects approval from a sanctioned institutional review board, and the permission to collect data from 4 agencies within the state government. Luckily, we were allowed to proceed with our study after political pressure was applied from on high.

This little story should tell you about the use of furloughs to help close budget deficits: Politics, not empiricists, make the decisions, and politics and empiricism might be mutually exclusive. Why did this particular state allow us to continue with our research? Because in the midst of a political race, one side wanted to know the results of our study and the other didn't. What could we, nobody academics, possibly find that politicians seeking office would want to highlight in a campaign?

Simply, we found that as a furlough day approaches, employee emotional exhaustion, the key component of burnout, increases while job performance decreases. But it gets worse. The increased exhaustion peaks on the furlough day, remains high for a couple of days, and finally returns to pre-furlough levels a week or so later. All the while, employee job performance decreases until the exhaustion clears.

To further examine what happens during the nearly 3 week period bracketing the furlough (10 days before, 7 after), we also looked at how these exhaustion/performance effects might differ among employees. We measured employee predisposition to ruminate (e.g., constantly think about bad events) and employee positive recovery behaviors (e.g., doing things to get mentally get away from work). Unsurprisingly to us, employees who ruminated more over the impending furlough became more emotionally exhausted and took longer to recover from this exhaustion; consequently, these employees often had the biggest decrease in their job performance. Conversely, employees who reported taking steps to "get away" from work indeed had lower exhaustion, not as large of a decrease in job performance in the run up to the furlough, and faster recovery after the furlough. It's worth noting, however, that even these employees experienced increased exhaustion and decreased performance, too. It just wasn't as bad as those who ruminated.

What do we think happened here? Let's be honest about what a furlough is: a pay cut disguised as a day off. The more someone thought about this, the more upset they became and the less motivated they were to perform their jobs. For those employees who actively sought ways to "get away" from their jobs, the less impact the furlough had on them.

We viewed furloughs as a personal resource drain, and we recommended giving employees choices in this furlough (as some states do but the state we examined did not): Take the pay cut and continue working (after all, deadlines don't take days off and many furloughed employees work from home on their furlough days), choose the day of the furlough akin to a floating holiday, or schedule furloughs around holidays or weekends. Again, some states allow for these choices, but the furlough remains what it remains: a pay cut. And the work doesn't wait.

I excitedly presented these results to my LRS/MBA 573 course on Organizational Staffing, and the discussion quickly devolved into a discussion on the worth(lessness?) of government employees. Aren't government employees depressed anyway? I found this interesting and indicative of the pernicious effects of staffing practices like furloughs. On the one hand, many Americans view government employees as lazy at best and utterly stupid at worst. On the other hand, furloughs achieve exactly the results that confirm these stereotypes. We want better government employees but do things through policy to achieve the exact opposite; yet another example of the Folly of Rewarding A, While Hoping for B.

Is there any wonder politicians might be interested in our research?

(In case you're wondering, I did remind the class that I am a government employee who liked my job and wasn't depressed, but I don't think that stopped them from thinking that government employees were lazy and stupid!)

What we could not examine was how our results might link to financial or productivity outcomes at a more macro level. Unfortunately, governments have fixed budgets and metrics like sales or revenue in a for-profit sense are meaningless. We suspect that the decreases in employee performance affect the economic productivity of government organizations, which makes us question how much money furloughs actually save the government. Furloughs might make the short-term bottom line look better but ultimately do long-term productivity damage. This will have to remain a suspicion until we can find a government that tracks productivity and allows us to collect data. Good luck to us.

Saturday, June 5, 2010

“What Happens to ADHD Kids When They Grow Up?” They Go to Work

Commentary
by Professor Tony Wheeler
Associate Professor of Human Resource Management

I’m old enough to remember the days before the phrase ‘ADHD’ (Attention Deficit Hyperactivity Disorder) became a permanent fixture in the consciousness of Americans. Ritalin anyone? Like many of you, I’ve always wondered what happens to kids diagnosed with this disorder when they leave school. To be honest, I do not know if any of my undergraduate or masters’ students suffer from the disorder, and I always assumed that kids either learned to adapt to it or outgrew it. I do, however, hear stories that student pass Ritalin around the dorms to achieve the same thing that us geezers used NoDoze for, which makes me think that students used it recreationally instead of for its intended purpose.

But I digress. Why am I writing about ADHD on the SLRC blog? It turns out that about 50% of ADHD cases persist into adulthood, with about 4% of the US workforce suffering from the adult version of ADHD. Adult version meaning that it’s ADHD just with the word ‘adult’ in front of it. Persistent inattention? Check. Inability to focus? Check. Poor time management and organizing skills? Check. Tendency to procrastinate? Check. That’s ADHD, and researchers estimate that ADHD in the workplace accounts for an average of 35 lost days of employee performance per ADHD employee, costing an estimated $19.5B in annual employee productivity. And, don’t forget that ADHD is covered under the Americans with Disabilities Act. Yes, my technocrat HRM friends, that means reasonable accommodation.


A colleague of mine and I just finished a research project that examined how ADHD impacts employee performance. Primarily, we looked at how ADHD interacted with employee engagement to predict job performance. Work engagement is “a positive, fulfilling, work-related state of mind that is characterized by vigor, dedication, and absorption” (Schaufeli, Salanova, Gonzalez-Roma, & Bakker, 2002, p. 74), and highly engaged employees have abundant emotional, psychological, and physical resources at their disposal to meet the demands of their job. Engagement positively relates to employee job performance and organizational citizenship (extra-role) behaviors. Which brings us to ADHD.

We collected data from 3 samples of full-time employed working adults (several hundred employees working across dozens of occupations and industries), and we found that ADHD is like a broken “resource governor.” That is, when you are engaged in your job and have all of the resources you need to excel at your job, ADHD impedes affected employees from properly allocating their energies to do their jobs as well as they could or should.


We admit it’s a simple finding. But it’s an important finding with simple solutions. First, companies need to know and be aware that ADHD affects a portion of their workforce. Second, employees need to know and be aware, too. There is a social stigma surrounding ADHD, which prevents affected employees from seeking help. This costs employees their dignity and companies their profits. Third, the solutions are simple. Aside from available health insurance to see doctors who can diagnose and treat ADHD, companies can provide simple accommodations to ADHD employees: a quiet and uncluttered workspace, time management seminars or training, and a supportive environment. The relative costs are minimal compared to the substantial benefits.



Schaufeli, W.B., Salanova, M., Gonzalez-Roma, V., Bakker, A.B. (2002). The measurement of engagement and burnout: a two simple confirmatory factor analytic approach. Journal of Happiness Studies, 3:.71-92.