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Improving Morale Vital to Success and Survival

In an email exchange with a friend this week, the following dialog occurred:

A (an editor at a local newspaper in the UK):"Today is pay day and, as it is June, should have seen a small pay raise. However, our salaries have been 'under review' since April. They finally told us wages were being frozen in an email sent at 5 pm yesterday. Look, I know we still have jobs and all that, but what the hell?"

B (uh, me):"Well, having a job is a good thing given what's happening to newspaper circulation."

A:"One of our Board Members was invited to speak to the government Media Committee because our regional papers sell so well; funny how that wasn't reflected in our salaries."

B:"I guess you could argue that it was reflected in that your salary didn't go down. Most newspapers are cutting salaries and staff across the board, so getting the same isn't the worst thing that could have happened."

A:"Yeah, but we also found out at our monthly briefing today that the company has been donating money to the Conservative Party. How come they can give money to David Cameron (leader of the British Conservative party, and likely next Prime Minister) but not to me?"

The reason I repeat the transcript here is that it strikes me that it shows several themes that are becoming ever more noticeable as the current recession wears on—not to mention an almost textbook case of extremely poor leadership.

First, my friend's complaint struck me as unusual in that it was both justified and unrealistic. Justified in that he had every right to expect an announcement on his salary well in advance of being paid, but unrealistic in expecting any kind of wage increase in the current environment.

What really got me about the exchange, though, was the tone my friend employed towards the end of it. This is someone who works for a newspaper group that is comparatively successful (in that it actually makes money), who is a valued member of the company (and knows it), but who is becoming increasingly disgruntled in his job due to management decisions that never quite seem to have the best interests of the employees at heart. As a result, his morale is dipping and his company is risking losing his talents when the economy turns around.

This trend is one that I believe is building within the economy. A few months ago the majority of employees were terrified and willing to do whatever they could to save their jobs. Those who still have jobs today, however, have begun to realize that—short of another meltdown in the economy—they're likely to ride this thing out. As such, their fearfulness is disappearing and, along with it, their willingness to sacrifice much more.

Sure, they might be stuck working longer hours for the same or less money than they made last year, but the impression I'm getting is that more and more people are viewing that as temporary. As soon as the economy shows signs of life, they'll be looking to go back to the deals they had prior to the recession. Whether that's with their existing employer or a new one depends partly on how soon their situation is rectified, and partly on how they're being treated now. In my friend's case—effectively being told that his standard of living is of less importance to his employer than currying political favor with a party he doesn't support—that battle has already been decided.

Of course, there are many managers out there who realize the importance of keeping their employees happy—both for short-term morale and long-term retention—even during times where employees have nowhere else to go. And, as this piece in the Wall Street Journal shows, keeping morale up doesn't necessarily have to involve spending a lot of money. So, while saving on staff costs may be an effective way to ensure that your firm navigates this recession effectively, a small investment to improve morale may well be the difference between mere survival in the short-term, and ensuring the retention of the employees likely to drive your company's success over the years to come.

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Phil Stott is a staff writer at Vault.com in New York. Originally from Scotland, he has also lived and worked in Japan, South Korea and Eastern Europe. He holds an MA in English Literature and Modern History, and a Masters in Research in Civil Engineering, both from the University of Dundee.

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