REDUNDANCY AND THE THREAT OF A GREAT DEPRESSION

tauringhuang.

Philip Joslin, a senior clinician at Lifeworks, a private clinic in London dealing with addictions and depression, believes redundancy “is not just a matter of economic survival. It threatens people's very identity”.

As the economy slows and jobs are cut, psychiatric practices based in London's financial centre are reporting a rise in referrals. Mark Beadle, chief executive of Capio Nightingale Hospitals, a provider of private psychiatric treatment, says the number of City workers coming to his clinics with depression or anxiety has risen by 30 to 40 per cent.

The psychological impact of redundancy goes beyond those whose jobs are cut, however. Christine Martin, therapist and partner at Haswell, Martin & Rose, a private practice based in central London, says: “Redundancy raises a wide range of issues – for the person losing their job, for the ‘survivor' who hasn't been made redundant and also the people managing the process such as human resources professionals.”

Bankers are under the greatest stress since financial services are at the sharp end of the downturn. JPMorgan Chase, the investment bank, has predicted that the fallout from the credit crisis could involve the loss of up to 40,000 jobs
in London's financial services sector during 2008 and 2009.

Don Serratt, director of Lifeworks, says the culture of financial services can make workers more vulnerable to acute anxiety in a downturn. Himself a former banker at Bear Stearns and Creditanstalt Investment Bank, Mr Serratt says the City attracts high-
achieving, hard-working alpha males. “Some think the world revolves around them, in good times and bad. When things are good they feel like masters of the universe, but when the bubble bursts they take it very hard. It can be devastating.”

He has seen the number of admissions to his programme for “impaired professionals” rise by 20 per cent in the first six months of the year compared with a year ago. The majority on this residential course are City workers with high levels of responsibility.

But as jobs are shed outside financial services, redundancy will raise issues for people across the economy, not only in the City. It often makes people question their sense of self. According to Ms Martin: “Redundancy demands existential questions alongside the financial worries. In other words, who am I if I'm not working?”

Upheavals in the workplace can undermine employees' sense of security, particularly if redundancy is not a one-off. Ms Martin says: “Even those who survive the first wave are left with uncertainty over whether their job is safe. They worry ‘is that it?' ”

David Freud, author of Freud in the City, former vice-chairman of investment banking at UBS and great-grandson of Sigmund Freud, says any changes in power networks at workplaces can be very unsettling. “The people who are in control in boom times are not the ones that are in control in recessions. Suddenly different people are in control and all of your networks are uncertain.

“You have to justify your decisions to a different group of people. It's a massive transformation and you feel out of control. The master of the universe in an upswing is now desperately neurotic because all their power bases have gone.”

It may also mean that employees have to take on an increased workload. William Shanahan, medical director and lead addictions psychiatrist at Capio Nightingale Hospitals, does not believe we are in the grip of a “credit crunch depression pandemic” but says many of his clients are working harder; some are “burnt out”, which can produce psychosomatic reactions such as “rashes or even short-term paralysis”.

The potential for working harder, he says, is exacerbated by technology: “BlackBerries and mobile phones mean that people are not managing their time well. They cannot relax even on a holiday, which can create problems with families.”