We all know what a tsunami is, don’t we?
We’ve seen the horror of it visited on communities in Indonesia and Japan. We’ve witnessed the devastation it can wreak, where an unstoppable force inundates an area, sweeping everything in its path.
Imagine, if you can, the feelings of powerlessness such an event can cause.
Then imagine the tsunami was not a body of water, but something else entirely. Imagine it was economic in nature: a constant deluge of price rises, spiralling bills, energy price hikes, inflation and real wages that flatline.
What impact might that have?
To start with, let’s remind ourselves that human beings have a wonderful system that each of us has access to. This system creates all of the innovation and problem-solving we’re so good at. It enables us to deal with complexity and change in flexible, adaptable ways.
This system, the human brain and mind, also scans for danger 24/7, to detect and respond to threats and keep us safe.
Great, so we’re armed with a flexible, problem-solving, threat-response system that’s brilliant at change. No problem, then.
Ah, just hold that thought for a second.
Human beings are good at change, but context is key. Control and influence are critical to consider.
When we’re faced with an aversive situation like a financial tsunami, a seemingly unending rise in costs and bills, where our levers of control and our ability to influence the impact are limited or negligible, something else can happen.
This is where understanding the concept of learned helplessness is vital.
Seligman (1967) developed the concept from laboratory experiments measuring the impact of being unable to escape from stress. In essence, the inability to control or escape from a stressful situation produced a passive response, so that even when an opportunity to escape presented itself, the subject remained passive.
In humans, learned helplessness increases the risk of depression, anxiety and conditions including PTSD.
If you’re leading a business, I would hope that first and foremost you’d want to reduce the chance of learned helplessness arising, from a duty of care point of view.
If you need a business case, though, ask yourself: what might be the impact on productivity of staff who are overwhelmed by stress and feel passive in the face of the economic challenges around them? What happens when people are so stressed by financial threat that it affects how they show up and function in their role?
The data is there. When the Chartered Management Institute surveyed more than 1,000 managers and team leaders during the cost of living squeeze of 2022, 71% said they had seen evidence of it increasing stress and anxiety in their teams. Of those, 93% said it was affecting productivity, which amounts to 66% of all the managers surveyed. Forty-one per cent highlighted “more distraction, less focus and attention to detail”, 33% reported increased sick leave or absence, and 31% a reluctance to take on extra work (as reported in The Guardian, 11 December 2022).
So the impacts of financial stress show up in sizeable numbers, and whenever household budgets are squeezed, the pattern repeats.
Increases in sick leave and absence are the early sign. If the pressure continues, the potential for learned helplessness to embed is all too real. And while this shouldn’t need stating, learned helplessness and burnout (exhaustion, mental distance from the job, and a host of psychological and physical symptoms) pose significant risks to individuals and teams. As with any risk in a business, I would suggest they should be understood, mapped and managed.
In a period when economic headwinds are battering organisations too, it makes not just ethical but business sense to put some thought and action into how we support each other.
What, then, can be done?
To borrow from another older model, Maslow’s hierarchy of needs (1943): by understanding people’s need for stability and a degree of certainty around specific needs, we can approach support in a measured way.
Unlike a tsunami caused by the unstoppable power of the ocean, there are steps we can take as leaders to soften the impact of a financial one. I would suggest:
Support services for those who are finding things tough.
Clear guidance on the help that’s available.
Opening up discussion and creating the space to talk about pressure points, with leaders prepared and trained to step into uncomfortable territory, so that people trust their concerns and fears can be voiced and explored.
Financial wellbeing initiatives.
Proper compensation and remuneration, and using profit to benefit the organisation as a whole.
Evidence-based, properly trained and resourced psychological support.
All of this helps people find solutions and perceive a degree of control. By developing whole-person support, we don’t just enable staff to manage stressors and avoid learned helplessness; we also support business continuity and productivity in the process.