What happens when employees are furloughed? A resource loss perspective

Abstract

Furloughs refer to placing employees on a temporary leave with no pay for the period of the leave. The current study draws from conservation of resources (COR) theory to examine how furloughs affect employees’ experiences of burnout, work–family conflict, and life satisfaction. Results gathered from 212 individuals show that being furloughed during the 2013 U.S. federal government shutdown was associated with perceived personal resource loss, which was related to decreased life satisfaction and increased work–family conflict and physical, cognitive, and emotional burnout 5 weeks after the shutdown ended. The relationships between furlough status and all outcomes were fully mediated by perceived resource loss. Our findings show that furloughs can and do negatively affect employees and that these effects last long after the furlough has ended.