Job Insecurity: Toward Conceptual Clarity

Abstract

A model is presented that summarizes existing knowledge concerning job insecurity, points at its deficiencies, and identifies further research needed to understand the nature, causes, and consequences of this increasingly important phenomenon. Such knowledge is crucial because job insecurity is a key element in a positive feedback loop that accelerates organizational decline. Four recent phenomena in the United States have made job insecurity a particularly important variable for organizational scholars to understand. First, the prolonged economic downturn beginning in the mid-1970s resulted in the highest rates of job loss since the Great Depression of the 1930s. Second, there has been an upsurge of mergers and acquisitions since the mid-1960s. These events often result in job loss or a curtailment in the privileges and expectations of job incumbents. Third, the rapidly changing industrial structure-from a predominantly manufacturing economy to a service economy and from the predominance of basic industries to the rise of high-technology industries-has changed many people's assumptions about the stability of their employers. Fourth, the trend toward decreasing union representation of the U.S. workforce means that an increasing number of workers are vulnerable to the effects of unilateral decisions from which they have little recourse. These phenomena can be threatening to workers. The threat is experienced as some degree of job insecurity, which is defined as perceived powerlessness to maintain desired continuity in a threatened job situation. Furthermore, workers react to job insecurity, and their reactions have consequences for organizational effectiveness. Despite its increasing importance, job insecurity has yet to receive significant attention from organizational researchers. The variable has been included as a facet of job satisfaction in numerous studies-for example, Hackman and Oldham (1974)-but few scales have been specifically developed to investigate

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“…Furthermore, given the public nature of the allegations, even in a good market, finding another job could have been a tall order for me. Therefore, the threat of losing my job, which I loved dearly, indeed elicited the same reaction as an anticipated death, as Greenhalgh and Rosenblatt (1984) suggest.…”

“…Research has shown that because of the widespread value placed on work, being terminated from work can be traumatic (Spera, Buhrfeind, & Pennebaker, 1994) and can lead to mental illness, suicide, child abuse and hospital admissions (Brenner, 1976). Job insecurity has been defined as perceived powerlessness to maintain desired continuity in a threatened job situation (Greenhalgh & Rosenblatt, 1984). According to Ferrie (2001), job insecurity can be self-perceived or externally attributed, and self-perceived job insecurity is composed of individuals who report their jobs as insecure.…”

“…According to Ferrie (2001), job insecurity can be self-perceived or externally attributed, and self-perceived job insecurity is composed of individuals who report their jobs as insecure. While the severity of the threat to the work situation depends on the scope and importance of the potential loss, Greenhalgh and Rosenblatt (1984) have shown that the anticipation of job loss produces the same reaction as an anticipated death. They further explain that the scope of potential loss may depend on whether: (1) the anticipated loss is temporary or permanent; (2) the action causing the loss is layoff or firing; and (3) the change represents loss of the job itself or loss of job features.…”

“…They further explain that the scope of potential loss may depend on whether: (1) the anticipated loss is temporary or permanent; (2) the action causing the loss is layoff or firing; and (3) the change represents loss of the job itself or loss of job features. Related to Greenhalgh and Rosenblatt’s (1984) study, Ferrie (2001) posited that perceived job insecurity is considered a more potent stressor than an anticipated death. The literature has also shown that it is likely that individual differences moderate the relationship between experienced job insecurity and individuals’ reactions to it (DeFrank & Ivancevich, 1986; Greenhalgh & Rosenblatt, 1984), influencing how job loss or job insecurity harms psychological and physical health as well as influencing the coping strategies selected for dealing with the job loss (DeFrank & Ivancevich, 1986; Greenhalgh & Rosenblatt, 1984).…”

“…Greenhalgh and Rosenblatt (1984) further explain that the sense of powerlessness is an important element of job insecurity, and has been suggested to be exacerbated if: (1) the organization had no strong norms of fairness; (2) the employee had no input into decisions and no right of appeal; and (3) superiors are seen as arbitrary in their evaluations and even capricious in their decisions affecting employees. This also depends on the employee’s beliefs about the organization’s standard operating procedures for dismissing employees.…”