Looming layoffs can impact employees' mental health and productivity

Pennsylvania state employees are likely relieved that massive lay-offs have been averted for the moment with the passage of a statewide table games law. But jobs may still be cut in the future; a kind of uncertainty that is a new reality for many Americans – and could affect their productivity and mental health.

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Getting bad news is bad, but not knowing what's next can be worse, says Ron Hill of Villanova's School of Business. He says amid looming lay-offs, employees tend to obsess over what will happen, and have a hard time focusing on their work.

Hill: This back and forth, this insecurity of 'when is the next round going to happen, and really, there is a feeling of distrust, because they don't know what they are going to hear next, so they hunker down, they try to do their job, stay below the radar screen, but I don't think it spurs people on to the highest levels of performance.

Paul Rusch of Penn's Behavioral Health Corporate Services says prolonged job insecurity can have a lasting impact:

Rusch: When people start to lose their sense of optimism, the road back towards resilience or revitalization is very difficult, because they have had a change and shift in their mindset, of what they think about themselves, about the organization and about life in general

Rusch says writing out a short, mid-range, and long-term plan helps employees deal with their anxiety over unemployment.

Rusch: So instead of them re-thinking and obsessing over and over again, what am I going to do, how do I handle this, where do I go from there for them to sit down and actually write out a plan, here is what I'm going to do, here are some of the things I can do in the meantime, when I can't get the questions answered, and I'm feeling so anxious and overwhelmed.

Experts also say companies need strong leadership, honesty, and open lines of communication to weather tough times.