AMA study: The costs of reduced employee loyalty

Reduced employee loyalty is costly to companies, but it appears that too many of them aren’t taking this seriously.

In an article for Workforce, American Management Association vice president Sam Davis reports on a new AMA research study showing that 52 percent of managers “see their employees as less loyal than five years ago.” He further notes that this perceived reduction carries negative costs: “A lack of loyalty can clearly be detrimental and result in loss of trust, higher absenteeism and turnover, shoddy work, gossiping, the formation of cliques and, in extreme cases, incite a mutiny.”

The December 2014 study included survey responses from some 1,200 North American executives, managers, and human resources professionals.

Unfortunately, the AMA study also suggests that a lot of employers aren’t taking the cultivation of employee loyalty very seriously. According to Davis, “One in five respondents said ‘yes,’ loyalty is a major focus at their organization. Some 56 percent said ‘no, not a major focus, but valued nevertheless’ and only 24 percent reported ‘no, it was never valued nor a major focus.’

Davis aptly states that “(e)mployees first need their basic needs met, such as fair compensation, a safe and nontoxic work environment as well as opportunities for career development.” Hallelujah! While it may be obvious that treating workers with dignity is the first step toward developing a loyal, engaged, and productive workforce, it doesn’t hurt when organizations such as the AMA repeat this obvious truth in hopes that maybe someday it will sink in to more of their members.

The other day I found myself grimacing at the cover headline of the current issue of The Economist newsmagazine, which blared “Watch out — The world is not ready for the next recession.” For so many workers, the recession that bubbled up in 2007 and hit with a vengeance in 2008 has yet to end. Here in America, the stock market has rebounded handily, but the labor market has never fully recovered all the good jobs that were lost, and compensation levels remain flat.

During this time, many corporations have continued to pay their top executives generously, often with hefty bonuses added on, and their wealthiest shareholders have done well too. In the midst of this growing gap between the most fortunate and everyone else, can it come as any surprise that a lot of workers aren’t exactly feelin’ it towards their employers? 

7 responses

  1. Reblogged this on Thrive_At_Life: Working Solutions and commented:
    You get what you give. If more employers treated employees as assets and treated employees justly, employers would get more loyalty. When there is an uneven exchange, stress in exchange occurs, causing one individual to have power over another (Emerson, 1976). Stated succinctly, the organizational culture influences the behavior of its employees interpersonally and towards the organization based on positively or negatively perceived organizational support, justice, and reciprocity.

    Emerson, R. M. (1976). Social exchange theory. Annual Review of Sociology, 2, 335-362.

  2. Many corporations benefited by the climate of fear as employers cut jobs and kept pay stagnant during the recession and afterwards. Attempts to re-ignite the housing market while ignoring the two -decade long over-valuation of real estate continue to repress housing sales. The false economy was bolstered by crook loans and moving debt by selling it as high-value debt-risk by encouraging home-owners to remortgage homes, often for trivial pursuits.

    You should be asking – who bought all that cheap real estate, when the market tanked and banks had to liquidate bad assets?

    Organized crime operating as corporate fronts bought it. They now control a sizable share of the housing and rental markets, and they aren’t above squeezing rents upward or ‘gentrifying’ neighborhoods to maximize profits, pushing middle and lower economic classes into precarious situations, because basic goods and services costs has remained high one year into a dramatic fall in fuel prices.

    The rich are getting richer, and the poor are realizing that they can’t make ends meet – legally.

    And that is the driver of a growing number of individuals joining the ranks of citizens willing and able, even eager, to enter into ‘citizen policing’ of workplaces, neighborhoods, even entire smaller and mid-sized towns, throughout the US.

    They are the snitches of organized crime, and they operate through ‘revenge-for-hire’ online websites, that sell bullying to anyone willing to pay.

    This is a form of modern hell that is far worse than simply facing a entrenched economic inequality – it is legal inequality, and the pushers are a growing cadre of peseudo-religious and supposed ‘constitutionalists’ who want the world remapped to their specifications.

    When you see your unemployed neighbors suddenly ‘blessed’ with brand new cars, mysteriously settled college and housing debts, by joining a cadre of similarly unemployed, but ‘busy’ friends who cruise communities and highways playing ‘community cops’, warning bells should be going off…

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