Leading Your Co-Op During the Coronavirus Pandemic
The Virus and The Economy
This week (March 23-27) is likely to be very bad in the U.S. from both a virus perspective and an economics perspective. Goldman Sachs believes that unemployment claims this week could rise from about 280,000 the week before last to 2.25 million this week. Economists at Bank of America say it could be as many as 3 million. It is likely that total unemployment due to COVID-19 will ultimately exceed that of the global financial crisis, which hit “only” 9 million. In fact, if we are to believe the president of the Federal Reserve Bank of St. Louis, we could hit a total unemployment rate of 30%, which is considerably worse than during the Great Depression, which hit a maximum of 24.9%. Such dire predictions appear to rely on rather extreme estimates of the virus’ scope and the duration of the pandemic.
However, a number of very bright people are more optimistic, particularly related to when we will see improvement in the spread of the disease, which has clear economic ramifications. According to Dr. Campbell Harvey, a finance professor at Duke University who is also a research associate of the National Bureau of Economic Research and former president of the American Finance Association, we may be at an inflection point in about a week. That inflection point is the time at which the number new cases begins to decline. That is critical to our recovery, and it might be here sooner rather than later, based upon Dr. Harvey’s statistical modeling which looks at the virus’ spread in other countries.
Dr. Michael Levitt, who won the Nobel Prize in Chemistry in 2013, has been conducting extensive statistical modeling on the virus in countries around the world as well. His analyses appear to suggest that we will reach an inflection point in a couple of weeks in the U.S. if people take the precautions being advocated by the CDC.
While the worst is yet to come, and the economic aftershocks will continue for many months, we may yet avoid a depression and instead see a sharp, though hopefully short-lived, recession. Of course, at this point, it is anyone’s guess.
What Your Employees are Dealing With
As you know, your employees are dealing with stress beyond anything any of us would have predicted two or three weeks ago. Most of them have never felt threats from so many directions at once. They are simultaneously having to contend with multiple factors that are each in themselves highly complex and strain-inducing, including:
1. Risk of a potentially life-threatening illness for themselves and their loved ones
2. Shortages of food and necessary supplies
3. Job losses – perhaps not theirs at the co-op, but certainly for their spouses and other family members
4. Tremendous upheaval at their workplace
5. Schooling their children at home or finding care for them
6. Loss of personal connection with others
7. Uncertainty about their financial future and despair about loss of retirement funds
8. Concern about the wider economy
These extreme stressors are likely to produce a host of employee-related problems in the near term.
In the coming weeks, we anticipate a wide variety of possible negative outcomes for employees, including:
1. Safety problems
2. Interpersonal conflict at the co-op
3. Team dysfunction
4. More turnover than normal
5. Unusually high levels of ethics violations
6. Declining physical health due to stress
7. Declining mental health, including increasing suicide risk
We expect these issues to get worse as the economic, social, and workplace consequences of the virus become more impactful on us as individuals and on our families and employers.
What You Can Do As A Co-Op Leader
Your employees are relying on your leadership skills now more than ever. The team at GreatCo-Ops suggests that you focus on the following leadership approaches during this challenging time:
1. Pay more attention than ever to your safety climate. Your employees are distracted by worries, and this leads to significant additional safety risk.
2. Ensure that you have a quality Employee Assistance Program and that it is marketed to your employees very well. Encourage them to use it if they feel the need. De-stigmatize the use of it the best you can.
3. Communicate at least every other day in these early days with your entire workforce about your co-op’s responses to the virus, also being sure to convey your thanks for the sacrifices they are making. Acknowledge the uncertainty and anxiety we are facing as a nation, while also communicating messages of hope and optimism. (This is a fine line to walk; you must be realistic, yet hopeful in your message.)
4. Reach out to your direct reports at least weekly inquiring about how they are doing, asking about their families, and offering your support and encouragement. Ask them to do the same with their direct reports, and keep pushing this approach down the hierarchy.
5. Give your employees the benefit of the doubt regarding flexible work schedules. The compassion you show now will come back to you in the form of employees who appreciate you and the co-op more than ever.
6. Do NOT forget to take care of yourself and your loved ones. Times like these literally kill senior executives.