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The Work Effort and Job Security Relationship

Some companies have learned hard lessons that employees may not be
willing to be sufficiently flexible in their work assignments when their
employers have employment security policies.89 Unfortunately, high-
standards companies that provided such employment security in the past
may have endangered their own adaptability and survival through these
enlightened or progressive human resource practices. Not only have some
employees failed to reciprocate by making personal adjustments needed
for the welfare of the company, employees may become shielded from the
realities of the marketplace and too complacent in today’s era of intense
competition. Interestingly, with an appropriate level of job insecurity,
employees may work harder. A recent field study has found an inverted
“U”–shaped relationship between job insecurity and work effort. As
presented in Figure 1-1, effort increases as insecurity escalates from low to
moderate levels, but it declines with high levels of insecurity.90 The
implications for human resource investment policy are that there may be
trade-offs between the benefits of employment security policies and the
costs—to include the amount of effort that may be expected from
employees. However, this relationship is obviously only an average
tendency to which there are many exceptions.