|Consumer debt has jumped 46% since the end of the recession even as one-third of U.S. workers fear for their jobs.
Because job insecurity is now a permanent part of the economy. That means more job stress as workers feel pressure to put in longer hours and forgo vacations, all to prove their worth to the boss.
There's no denying the upturn in employment after a prolonged "jobless recovery." The recession ended in November 2001; nonfarm employment kept falling through August 2003 and didn't surpass the pre-recession level till February 2005. But the economy is slowly, steadily adding jobs, and a record 143 million Americans now work. January's 4.7% jobless rate wasn't far from the 3.8% seen in the hiring frenzy of 2000.
35% 'concerned' about layoffs
Boom time? Not according to workers. An annual survey by ISR, an employee research and consulting firm, found that 35% of workers last year were "frequently concerned" about layoffs, the same as recession-year 2001. And a survey fielded for Hudson Highland Group, a staffing firm, found that 19.5% of workers last month worried about losing their job "soon," the best showing in a year -- but still a big number considering the relative health of the job market.
It's easy to see why workers are skittish. They face outsourcing, the China threat, plant closings and corporate cutbacks. The number of news stories citing "job cuts" increased last year for the first time since the recession; government data show "mass layoffs" -- cuts of 50 or more -- rose in 2005 after falling in the first three years of the recovery. All this may leave workers with "a general sense of unease," said Patrick Kulesa, ISR's global research director.
Wages aren't keeping up
Wages aren't keeping up. Salaries and wages rose by the smallest pre-inflation rate in 2005 (2.4%) since the government began tallying employment costs in 1975. After inflation, the average worker made less last year than in 2002.
Workers find themselves in a fix: Worried (probably too much) about layoffs, concerned (correctly) about losing ground to inflation, uneasy that new jobs may be even less secure and have lower pay and benefits. This helps explain why workers are in more of a funk than strong employment numbers would suggest, said Lee Price, research director at the Economic Policy Institute, a Washington think tank.
How do workers respond? By hoping they measure up. George Faulkner, principal with the consultancy Mercer Health & Benefits, notes employers have become more formalized in tracking productivity and job performance, meaning more pressure on the job.
Mandatory vacation time
Many workers are reluctant to take vacations, fearing the boss will view them as slackers -- or decide they're not even missed. A 2005 study by Universal Orlando Resort found about half of workers left vacation time on the table. That actually leads to some good news: Mr. Faulkner said employers, concerned about health and productivity if workers don't take time to recharge, are beginning to add policies mandating that employees take at least a weeklong vacation.
For now, there is no sign that job worries are translating into pared-back spending. The recovery was driven by consumer spending, financed with borrowed money and wealth generated from the now-flagging housing boom. Consumer debt has jumped 46% since the end of the recession, and all that spending and borrowing may exacerbate worker concerns: Americans can't afford to lose their jobs.
Brought to you by: The Trade Desk