The Corrosive Effects of Employee Dissatisfaction

Combating the ‘contagion effect’ on happy workers

We know one of the major reasons employees leave their jobs is dissatisfaction. So, why is it satisfied employees also leave your organization? One answer to that question is negative attitudes held by co-workers, which work as a kind of acid on your happy employees, until they, too, become dissatisfied. This is one finding of a study from the Cornell Center for Hospitality Research that takes the unusual step of measuring the change in turnover and employee satisfaction across a period of two years.

All other studies of turnover take a snapshot of employees’ satisfaction at a single point in time. That is useful, but even more valuable for managers is to find out why turnover and dissatisfaction are going in a particular direction. The study was conducted by a team of three researchers: Timothy Hinkin of the School of Hotel Administration at Cornell University; Brooks Holtom of the McDonough School of Business, Georgetown University; and Dong Liu at the Ernest Scheller Jr. College of Business, Georgia Tech. They surveyed 5,270 employees in 175 business units of a hospitality industry firm that operates golf courses, country clubs, business and sports clubs and resorts.

What they found is that the trend is not your friend, because there is a “contagion effect” of employee dissatisfaction, particularly when the satisfaction levels of employees in a work unit are deteriorating. In a situation where your happy employees are caught in an operation full of gripers, the happy employees will gradually lose heart and decide to leave. When these formerly happy employees are your top performers, you’re losing good people because others are dragging them down. Even worse, chances are many of your unhappy employees would like to leave but cannot because they are not high performers.

The contagion effect also works in the other direction. If you have a dissatisfied employee who works with a group of happy employees, that person is likely to become relatively more satisfied. In a work unit with a mixed bag of happy and unhappy workers, Hinkin and his associates found no particular trend, and satisfied employees will generally stay that way. It’s only when they are faced with relentless negativity that their optimism fades, and turnover becomes very likely.

Most human resources managers keep track of employee satisfaction. In doing so, they need to pay attention to two measures. One is the trend of satisfaction, of course, but just as important is what the researchers call “dispersion;” that is, the concentration of dissatisfaction in a particular work unit. The most negative situation would be when satisfaction is deteriorating and there’s little dispersion. The result is likely to be increased turnover, of course, but that’s only part of the problem because this situation feeds on itself. When you assign new employees to such a unit, for instance, they are soon likely to lose their optimism and become as jaded as their more senior associates.

Hinkin, Holtom and Liu suggest that HR managers increase the frequency of their satisfaction checkups, monitor trends and work to offset concentrated negative attitudes, thereby eliminating a source of corrosion in your organization.

Glenn Withiam is director of publications for the Cornell Center for Hospitality Research.

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