What Is Job Insecurity?

A woman laying her head down on a laptop.

Is your organization paying attention to job security? It still matters to job seekers and employees. Here's what every leader needs to know about feelings of insecurity among the workforce and what can be done to address them.

Job insecurity can affect your employees' engagement levels, job satisfaction and even their performance. As the ADP Research Institute (ADPRI) People at Work 2023 report indicates, employees continue to rank job security second as an important job quality, with 43 percent saying it's a top factor right after salary.

And yet, the topic has been mostly overlooked in discussions around productivity, employee well-being and retention.

Once upon a time, employers commonly used the promise (and reality) of job security to attract job seekers and retain employees, often for decades. Likewise, job seekers sought out positions with organizations where they knew they could stay as long as they wanted.

But the employment landscape has changed over the past several years, and as more young people enter the workforce, trends will likely continue to shift as a result. However, job security clearly still matters to many people.

Here's what you need to know about how job insecurity may be affecting your workforce and some measures you can take to address it.

What is job insecurity?

Job insecurity is, at its core, a feeling, and thus it can be challenging to quantify or measure outside of listening to employee sentiment. Because it's based on experience and emotions, what constitutes job insecurity varies from one person to the next. The circumstances that might lead to one employee feeling high levels of anxiety around job security might not faze their co-worker in the slightest.

"An employee's feeling about their own job security is an incredibly personal thing," says Amy Leschke-Kahle, vice president of talent insights and innovation, ADP. "Identify the most critical one or two success metrics for the overall business and regularly update employees on how the business is doing. Each of us has our own life conditions and thinking patterns that impact how secure we feel."

It's not just about what's happening inside an organization, either.

"The economic environment as well as the employer's perceived market position are also factors," Leschke-Kahle adds.

While many of those external factors are outside business leaders' control, they can take steps to foster feelings of job security within their organizations. It starts with understanding the experience employees are having now.

Identify the most critical one or two success metrics for the overall business, and regularly update employees on how the business is doing ...

photo of Amy Leschke-Kahle

Amy Leschke-Kahle, VP of talent insights and innovation, ADP

Factors that can affect job security

As mentioned, the generational shift taking place in the workforce impacts feelings of job security as does an era of low unemployment rates and talent shortages.

"As the wave of baby boomers continues to leave the workforce, at least from a numbers perspective, and in areas where the talent pipeline isn't able to replenish the workforce," Leschke-Kahle says, "theoretically, it should help those who are still working feel more secure."

Employees' feelings of job insecurity vary depending on their work arrangements, too.

ADPRI found that more employees who work completely remotely report feeling insecure about their jobs compared with people who work on-site only (49 percent and 36 percent, respectively). While the benefit of location flexibility and other attractive qualities of remote work may offset those concerns for many, some remote workers may need more support to address their feelings of job insecurity.

Requiring your employees to work on-site may seem like an easy fix, but it's not the only (or even the most effective) way to help them feel secure. Instead, investigate remote workers' experiences on a deeper level, identifying which feelings stem from job insecurity and which stem from other concerns. Then, make a plan to address any problems you uncover.

What employers need to know and do

Communicating with employees openly, clearly and consistently is one of the most effective ways to nurture feelings of job security.

"The most important thing for employers to recognize is that their employees want clarity and don't expect 100-percent certainty," Leschke-Kahle explains. "They want clarity around how the business is doing, clarity about near-term initiatives to ensure the business is sustainable and hopefully growing."

Transparent communication with employees about the health of the business can help foster employee engagement and inspire a sense of purpose. Essentially, it helps employees feel like they're part of something larger and more meaningful — not just spinning as a cog in a machine.

And it's crucial that this communication isn't just talk. Leschke-Kahle recommends sharing hard data that illustrates the story.

"Identify the most critical one or two success metrics for the overall business, and regularly update employees on how the business is doing," she says. "Educate people on what the metric is and update on where the metric is — and do this monthly or quarterly for every employee, not just leaders."

Fostering security in an uncertain world

A pandemic and ongoing economic uncertainty created stress for many people. But as long as job seekers and employees value job security, leaders must be proactive in building organizational cultures where feelings of security are the norm, not the exception or something reserved for executives.

Creating communication strategies that operate in two directions is also crucial. Leadership can then understand employees' concerns and address problems before they become an organizational crisis. As Leschke-Kahle notes, employees value clarity more than certainty. So, look for ways to be open and honest about what's happening within the organization and how the organization is responding to external forces.

To find out more about job insecurity and other global workforce trends, check out the research in ADPRI's People at Work 2023 report.