Leading Through Job Insecurity

Prior to 1959, the most common type of safety restraints found in automobiles were simple belts anchored in two locations that stretched across a passenger’s waist to keep them from being ejected in the event of an accident, but which left the upper body open to severe injuries such as whiplash. Today’s three-point safety belts, which prevent individuals from being thrown forward during a collision, were designed in 1959 by Volvo engineer Nils Bohlin. Though Volvo patented its three-point harness, in the interest of greater public safety, the company gifted the design to the automotive industry at large, free of charge.Volvo’s priority of automotive safety over its own profit completely changed the industry’s approach to seatbelts and has saved millions of lives since it opened its patent to widespread usage. As unemployment numbers within the US continue to rise and people grow increasingly concerned about layoffs, leaders at community financial institutions (CFIs) should consider focusing on how to respond so their employees feel more secure. Failing to do so could not only result in heightened anxiety and stress among employees but also poor employee morale and reduced performance. The Side Effects of Job InsecurityAccording to data from the Bureau of Labor Statistics, the unemployment rate within the US hit a four-year high in November 2025 at 4.6%, and economists predict much of the same for the foreseeable future. Not surprisingly, the American Psychological Association’s 2025 Work in America survey found that more than 54% of US employees are stressed about the possibility of losing their jobs. These fears are fueled by growing concerns that artificial intelligence (AI) poses a threat to many people’s job security. Such worries can have a negative impact on people’s performance at work, particularly in the form of stress, disengagement, narrower thinking, and aversion to risk. Anxiety caused by employees’ fears of being laid off can also pollute an organization’s culture, as employees shift their focus to protecting themselves and may withdraw or become less trusting. This has been termed “pre-traumatic stress disorder” in some circles of psychology, where anticipatory anxiety can deteriorate an employee’s personal life and health along with the professional focus. In many cases, employees concerned about losing their jobs become less innovative and more focused on looking for employment opportunities elsewhere, whether or not doing so is necessary. How To Reassure Your TeamWith rising unemployment likely to continue dominating headlines for the foreseeable future, the best thing that employers, particularly managers, can do is to acknowledge the elephant in the room. Since people typically assume that the worst will happen, addressing such concerns is important. One good way to broach the topic is to use headlines as a jumping-off point to ask employees how they are feeling and gauge overall morale within your organization. Staying connected to employees on a one-on-one basis is also important and demonstrates that managers care. Though managers typically can’t share everything that they may know about an organization’s staffing plans, demonstrating an understanding of your team’s stress regarding such possibilities can help to relieve some people’s anxiety. It can also be a good starting point for helping staff focus on the best way to approach their jobs moving forward. Similarly, if your CFI is changing its strategy, give your staff a voice. Ask employees their thoughts on how and where existing projects may align with any changes. Get their feedback on new ideas and how roles and responsibilities can shift in ways that still play to everyone’s strengths. This can instill a sense of control and ownership in employees and reignite their passion for the organization by allowing them to have input on the direction of their position. Some team members might just surprise you with skills and background that they haven’t had a chance to use in their current roles, but will fit well with your new strategy.Reassurance alone, however, only goes so far. While open communication and empathy help calm immediate fears, employees are more likely to feel secure when they can see how leadership is investing in their future. One way reassurance becomes tangible is through opportunities that allow people to grow, contribute, and envision a longer-term path within the organization.Investing in Employees’ FuturesEven if an organization doesn’t intend to scale back staff, job insecurity in the current market has heightened workers’ awareness of the importance of professional development. A growing number of businesses have embraced internal talent markets as a good way to enable employees to have a say in which skills they want to develop. Based on the findings of a study conducted by multiple universities, systems that allow employees to self-match the roles and skills they are interested in may not boost productivity within an organization as much as those that use company-dictated assignments, but employees perceive them to be 38% more valuable, according to Harvard Business Review. Such satisfaction enhances the likelihood that people will be more engaged in their roles and less likely to seek job opportunities within another organization. To ensure that internal talent markets are the most effective for all parties, CFIs might consider taking a hybrid approach to skill and role development, where the needs of both employers and employees are incorporated into matches. It is also important to ensure that any roles or assignments offered to employees are outlined clearly and in detail so that people understand where their existing skills best match up. Another approach to consider is offering incentives to get people to take on roles that may not be their first choice, but where their skills would best serve the company. For example, a system may inform specific employees that they would be one of the top candidates for a particular position and that if they were willing to take on that specific role, they would receive an additional benefit, such as a few extra vacation days each year. Internal talent markets don’t necessarily have to be so structured and formal. Mastercard offers employees a talent marketplace called Unlocked that is largely volunteer, where employees can take on responsibilities in addition to their main roles to acquire new skills or learn about different job functions. Through Unlocked, employees can volunteer their services for mentorships, specific projects, or open roles, based on their individual capacity and through ongoing discussions with managers about their development goals and priorities in these experiences. The system has benefited the company and employees alike by helping expand staff’s capabilities and encouraging greater idea sharing throughout the organization. As economic uncertainty persists, organizations can play a meaningful role in easing job insecurity by pairing honest communication with visible investment in employee growth. Doing so helps shift focus from fear to engagement and strengthens the organization over the long term.