Getting staff through economic hardship begins with better leadership

As interest rates rise and inflation creates added stress on employees, looking after worker wellbeing may fall behind as a priority.

However, leaders are the best equipped to assist and pull companies through these hardships, said business strategist Angela Vithoulkas. Those who don’t understand this can run the risk of damaging business efficiency.

“I’m a big believer in leadership from the top down. And I think if leaders and business owners and executive levels are out of touch with how their team is feeling and what’s impacting them, then not only does that cause a disconnect, but from a business aspect, it will impact productivity,” Ms Vithoulkas explained.

“So, if you don’t have motivation as a human, then you should have motivation as a financial participant in the success of the business that you’re involved in, both to safeguard your own economic future and that of the company. Right now, it would be rare to have people at any level that aren’t impacted by what’s going on.”

Compounding the anxiety caused by the economy is the continued issues the pandemic is causing. People are burnt out after dealing with the stress COVID-19 caused and have now been thrust into economic troubles.

“I have a very clear memory of the 80s, when we had interest rates at 18 per cent in business. I do not remember the amount of angst that was going on; my businesses were still profitable, we were still paying our mortgages and our business loans, [and] there was never a presumption that you couldn’t afford it,” said Ms Vithoulkas.

“Interest rates now are at 5 or 6 per cent, and people are panicking over that amount; you think we would have all lost it.”

Leaders have the influence to assist employees during these hard times and help pull businesses through. However, Ms Vithoulkas noted that many may be disconnected from the severity of these issues, which is why it’s important for them to remain aware of the challenges.

She continued: “It’s no secret that most upper senior executives and owners and above are better able to cope with the financial stress, they are probably better educated, have better job prospects, they’ve probably got some savings they can fall back on or ways of financially coping with what we’re all presuming is just going to be a bit sticky for the next 12 to 18 months.”

“However, that said, we’re all got an emotional toll from COVID-19. And we all know that the emotional stress has a way bigger impact than the financial. So, what we’re dealing with is businesses that have a lack of human resilience within their organisations, and not necessarily able to empathise or be supportive of others who are less fortunate.”

Some ways to help mitigate the stress that these times bring is to speak to staff and gauge their feelings. Listen to them and find out what can be done to assist. Limiting unnecessary spending can also be worthwhile.

“What your team members don’t want to see is lavish decisions within an organisation because they can afford it when they’re not passing on those financial gains to other people in the organisation,” Ms Vithoulkas said.

“$5,000 to someone who’s backed up against a wall right now could mean the difference between them sleeping at night and saving their marriage. Big organisations don’t think they owe anything to their employees because it’s not their fault about what’s going on.”

She continued: “But it’s not about portioning blame; it’s about making sure that your business is still there in 12 to 18 months, because when you lose productivity, and you lose a competitive edge, and you lose talent, you’re going to look at a five- or 10-year, tough cycle to come out the other end. So, I think that it’s disappointing that leaders who are supposed to understand the big picture and are employed to look ahead aren’t looking ahead from the human factor and what’s going on right now.”