These days, we’re all disgruntled workers

March 23, 2012

The average Goldman Sachs employee earns in excess of $350,000 per year, and we’re assured Greg Smith, who most visibly quit his job there last week, was paid substantially more.

And, in leaving his long-time employer, Smith didn’t abandon just a fat salary. To regain his career freedom, he knowingly forfeited a considerable sum in deferred compensation as well.

Most people in the world, of course, can only dream of being so highly paid for their work, so it’s a good assumption that a very large percentage of the working population has summarily judged Smith’s resignation as an act of complete insanity.

If they could coach him, they would say: “Go back to Goldman, Greg! You have a terrific deal! Subordinate your concerns about a declining corporate culture and profit-at-any-cost leadership. You have a penthouse to go home to at night!”

But this scenario is a complete fantasy. Regardless how little or much they are making, U.S. workers have begun to quit their jobs – in droves – to go in search of organizations, and leaders, they feel will better support their needs. As Smith’s actions show us, pay no longer is the driver of engagement or job satisfaction it once was.

Last year, a MetLife study published in USA Today showed that at least one in three U.S. workers was quietly planning their departure and already had begun looking for a new job. Stunningly, the report noted that most bosses were oblivious to how unhappy and inherently disengaged their employees had become, and would be caught flat-footed when their workers walked out.

Right after Thanksgiving, Time Magazine reported the first evidence that MetLife’s predictions might be right: “With 14 million people still unable to find work and job prospects seemingly bleak … in September, 2 million people gave notice.” Extreme unhappiness on the job was cited as the reason so many workers would take such a risk. Inherently clear was that a lot of people had lost faith in the leaders for whom they worked.

In just the past few days, payroll company ADP confirmed that employee turnover is building even greater momentum. “More people quit jobs in February than in any time since the start of the Great Recession.”

Having been an executive leader for nearly 25 years, I know what it’s like to read statistics like these and to dismiss them as unrelated to my team and business. I suppose it’s even human nature to go into some form of denial when first confronted with bad news. Here’s a good example.

After Greg Smith resigned, Goldman Sachs CEO Lloyd Blankfein and President Gary D. Cohn defensively characterized him as being “disgruntled.” Then they attempted to further discredit Smith by referring to him as just one of the firm’s 12,000 vice-presidents.

Acting on self-preservation instincts, we’re inclined to shoot our messengers and not fully digest and consider the information they bring to us. This time, especially, we’re advised to ponder and respond to the feedback.

While few of us noticed, employee satisfaction has been declining for at least a generation. New York’s Conference Board, a century-old non-profit research organization, began measuring worker happiness in 1987. Its discovery is that the percentage of contented employees has fallen every year since then – regardless of good economic times or bad.

People (human beings) have grown disenchanted with their jobs largely because their needs have greatly changed. What once inspired them to put their hearts into work no longer succeeds.

Dating back to the Industrial Revolution, people once secured jobs to provide for their most basic needs, food and shelter. In those days, and for decades to come, a paycheck was accepted as an entirely sufficient exchange for one’s efforts.

But as it has grown increasingly easier for most people to put food on the table and a roof over their heads, what makes people truly happy and engaged at work now has very little to do with pay.

Subsequent employee engagement research produced by the Conference Board reveals that over and above salary and bonuses, what inspires human performance in the 21st century workplace is emotional currency.

Business leaders – and CEOs – take notice. To keep your employees from leaving, and then to rejuvenate their on-the-job commitment, you’ll need to adopt entirely new practices – ones that authentically address what people now require from you:

Your people want to contribute to the success of an organization they respect; to work directly for an empowering and caring boss; to be given opportunities to grow and progress; to enjoy reasonable job variety; and to have their efforts authentically valued and acknowledged. And all across the world, these five things matter more to people than pay.

There’s more you need to know. Employees cite the absence of concern, care and connection from their leaders as the primary reason they are so unhappy. They want to be fulfilled by the work they do and to know their contributions matter. Therefore, when leaders fail to relate more personally, to understand and genuinely support their individual motivations and aspirations, workers wither.

There are some enlightened organizations that are well on their way toward realigning their leadership cultures and to more purposively supporting the higher needs of their workers. They’ve begun to weed out the non-collaborators, leaders who are unwilling to advocate for and even nurture the people they manage. This list includes Starbucks, Four Seasons Hotels, Wegmans Food Markets, Google, REI and privately held SAS.

Last year, Wharton finance professor Alex Edmans evaluated the stock performance of organizations named to Fortune magazine’s annual list of the “Best Companies to Work For” and proved that companies making the list from 1984 to 2005 outperformed peers by 4 percent per year. These companies are reinforcing our understanding of natural law: “To give is to get.”

Roy Disney once said: “If you want someone to care, capture their minds and their hearts.” The heart has long been ignored in business, but bringing it back into balance with the mind in how we lead people has become essential to the recovery, and ongoing success, of the American economy.

PHOTO: A protester demanding that Republican Senator Jon Kyl help cut the annual deficit sits outside his office in Phoenix, November 10, 2011. REUTERS/Joshua Lott


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[…] are.” And secondly, implicit in his resignation, and further backed up by statistics in this Reuters article, “over and above salary and bonuses, what inspires human performance in the 21st century […]

Posted by On Greg Smith and Goldman Sachs « Thoughts of a commentator | Report as abusive

This information should come as a shock to those who think this entire social system cannot end.

Mostly, American management does not care a whit about the employees under them or how well they do their jobs. All they care about is their own self-promotion, which is based more on politics and appearance than on reality. “Your job is to make me look good!” Who has not heard that?

Posted by txgadfly | Report as abusive

I would love employees to get really mad and stand up and say I’M MAD AN I’M NOT GOING TO TAKE THIS ANY LONGER. American “management” is a FARCE. What worker hasn’t figured that out.

Posted by cactus11 | Report as abusive

True leadership is an uncommon quality. By that I mean leadership where people so admire and respect the leader (manager) that they actually want to do things for him/her – more than required – that is what true leadership, rare that it may be, produces. Every leader/manager should ask themselves every day “Why should these people follow me?” – if your answer is “Because I’m the boss” – that is not a good answer.

Posted by SayHey | Report as abusive

While what the author says is true, there’s other aspects to this. I retired early from my job in Boeing because I got tired of the BS. Forcing me to sign the standard conflict of interest statement that someone who purchases for a company has to sign, except I had nothing to do with purchasing for the company (they were going to give me a week’s unpaid LOA for refusing). They have no right to pass on who my wife works for or what stock I own when I have no decision making authority for company purchases. Forcing me to sign the company’s code of conduct. I have no problem with the code of conduct when I’m at work but by signing it, the implication was that it would apply even when I wasn’t at work. Increasingly taking control over how I do my job away from me and giving it to people who, as a general statement, couldn’t do my job if their lives depended on it.

That and many more bits that they just kept adding on made me say screw it. I may be very good at what I do but I can also do other stuff and you can find some other fool who’ll put up with this crap.

Posted by majkmushrm | Report as abusive

My neighbor who works for Wegmans will be glad to know about the “new” perspective towards employees. He was promoted to a higher supervisory position and returned to his old position after the new one required 24/7 attention. Apparently, he’s not the only one.

On another note, I’m glad businesses are finally losing money (no OTHER reason they would notice anything) after at least a 15-year decline in business environments for regular workers. Corporate greed executives, superficial “managers” whose only skill is that of dishonest manipulation and crony coverup, declining wages, demands for unbelievable tolerance towards workers who don’t work but “buddy” the supervisors, dumbed down jobs with cookie cutter parameters, abusive and discriminatory work places (& they DO get away with it)all described as TEAM PLAYING for propaganda purposes. If there’s anything the younger workers know, it’s about making a statement; unfortunately, the majority seem to lack ANY WORK ETHIC at all.

Posted by Esmerelda5 | Report as abusive

“Management” has gotten increasingly clueless over the years. My current “site leader” is a corporate stooge from the HQ, which is 2,000 miles away. I can tell he feels as if he’s been shunted to F Troop, because he travels back to HQ every chance he gets. When he’s here, he stays in his office with the door shut. We’ve had two program manager slots open for over a month – where’s the people? It is obvious to me that aerospace is headed for a real crisis – why would any intelligent engineer get into a soul-sucking job where new fighters take 15+ years to go from drawing board to service, and when Boeing can’t even put together a new airliner without a 3-year delay and unsustainable cost overruns? In the next 10 years, well over 3/4 of my company will retire, and there’s no new blood coming in. Laughable “lean” processes make work increasingly paralyzed, idiotic corporate-mandated systems like SAP prevent middle-managers having access to information instead of making it easier (if you need a specialist to decypher some Germanic voodoo, it doesn’t improve life), and total lack of accountability (that’s true-speak for “shared respources”, where no one “reports” to a program manager) all combine to make the employees’ lives an exercise in frustration. You can keep it. If the economy ever improves, the executives’ heads will spin at the rapidity of people bolting out the door.

Posted by Quatermass | Report as abusive

Feedback here thus far, combined with e-mail responses sent me, reveal an amazing distrust of leadership. We have a serious leadership problem in the US for sure.

Posted by markccrowley | Report as abusive

It has been my experience that everyone from department heads to board chairpersons have no insight into the businesses they operate. Interchangeable pegs simply applying whatever they correctly or incorrectly read in the latest fad management book.

I stressed out to the breaking point when lean manufacturing and just-in-time inventory were being applied in a job shop where I was a purchaser. The sales department could change customer contracts as close as two weeks before the delivery date but the raw material had a six week lead time. I was forbidden to personally inspect the raw material inventory and the computer inventory was roughly 85% accurate. I was ultimately let go for “not being able to do my job…”


Posted by endtimes | Report as abusive

The deplorable excuse for an educational system in America has given undergraduate and post-graduate degrees to a few who really deserve them and to a large majority who are no more capable of passing real college level courses than my dog, who, wonderful and smart as he is, is not college material. Armed with these degrees they head directly into management positions of businesses, when if they were required to prove their abilities in the actual workplace before being promoted to management, they would never make it to a position having authority over anyone else. Once in place though, the schemes and rationalizations these so-called managers employ to keep their positions are truly amazing. This includes making life miserable for any one who is qualified for their job and has the audacity to aspire to it, or any one who makes them look bad, whatever the reason. Until this pattern changes good jobs in America will continue to be hard to find and employees will keep searching until they find something better or give up trying.

Posted by lhathaway | Report as abusive

“As Smith’s actions show us, pay no longer is the driver of engagement or job satisfaction it once was”

It’s called a Hygiene-factor by Frederick Herzberg and the research is about 40 years old. Maybe after driving WaMu off a cliff the management team could have found time to read a book.

Posted by ARJTurgot2 | Report as abusive

Great Article,it really gives us all a lot to consider. Having left my last job, in fact, all my past jobs, over dissatisfaction, I figure now the time to just lose the traditional gig and go into business for myself. I’m also a freelance writer, and this piece was encouraging.

Posted by JeanMarcS | Report as abusive