Center for Advanced Human Resource Studies

A possible silver lining for companies in the midst of an economic downturn—study after study shows that worker absenteeism falls when unemployment rates rise.

This fact may not be much of a benefit to employers, though, reveals a new study led by Cornell ILR researcher John Hausknecht.

Additionally, the study reveals an even more troubling trend: worker absenteeism tends to creep up over the years, through good times and bad.

Employees spend more time on the job when local unemployment rates rise—but not all employees, according to the study, conducted by Hausknecht and two colleagues, Nathan J Hiller, professor, Florida International University, and Robert J. Vance, principal, Vance & Renz LLC.

The drop in absenteeism, they found, is concentrated among dissatisfied, uncommitted workers.  As a result, the company's least engaged and least productive employees are showing up more when the job market is bad.

Committed and Satisfied, but Absent All the Same

Is commitment the key to helping employers maximize worker productivity in a recession?

Not necessarily, say the researchers.

At first glance, absenteeism was lower for work units with high shared commitment regardless of satisfaction or employment rates.

The study also found, though, that absenteeism rates—even in high commitment units—still increased about five percent annually.  The study involved 12,500 employees in 115 work units of a state department of transportation.

"The largest increase for a single work unit over the six-year period was about 143%, while the largest decrease was about 26%," says Hausknecht. "Taken together, these rates suggest absenteeism increases relatively easily, while similar decreases are much tougher to achieve."

The slow rise in overall absenteeism rates may go unnoticed year to year. Taken over the long term, though, it substantially increases business costs (beyond baseline absenteeism costs).

The researchers estimated that "the organization sustained $6.25 million in absence-related losses in the final year alone (as compared to the initial year)."

Group Think: Justifying Absenteeism

With millions of dollars on the line, employers need to be more aware of what's causing this incremental rise in absenteeism. The study suggests that group culture and norms play a critical role.

First, people tend to overestimate the negative behavior of others and underestimate their own.

Next, they use exaggerated perceptions of group absence norms (e.g. "my coworkers are absent much more than I am") to justify their own absences—which edge up over time to meet the perceived group norm of higher absenteeism. Compounded over group members over time, absenteeism rises slowly, but steadily.

Unfortunately, this group dynamic isn't usually taken into consideration when employers address absenteeism. The study clearly shows that rising unit-level absenteeism goes beyond individual performance, commitment or satisfaction.
 
Yet, like much previous absenteeism research focused on individual behaviors and motivations, companies largely aim their interventions at specific employees who are frequently absent from work.

Practical Steps for Curbing Absenteeism in Any Economy

These research findings suggest organizations should rethink how they handle absenteeism.

First, the study shows it might be more valuable than previously thought for companies to closely monitor absence trends by unit. Once trends are identified, unit leaders can set goals for reducing or preventing increases in absenteeism rates.

Specifically, the researchers propose that targeted unit-level interventions and absence-reducing incentives are more efficient and less resource intensive than tactics aimed at individuals.

The implications of the study are especially relevant in a down economy—where work units are experiencing varying degrees of change due to fiscal challenges. Layoffs, forced part-time status or just a shared "sense of doom" can affect work-unit commitment and might increase the odds that shared norms of higher absenteeism get perpetuated.

While higher unemployment rates mean lower absenteeism in general, employers shouldn't count on that to either maintain a productive, committed workforce during a recession or address absenteeism over time.

The new study, entitled "Work Unit Absenteeism: Effects of Satisfaction, Commitment, Labor Market Conditions, and Time," is in the December/January issue of the Academy of Management Journal.

Download the ILR Impact Brief for more study details »