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Big Tech, Big Profits, and an Addiction to a Black Mirror
Big Tech, Big Profits, and an Addiction to a Black Mirror
Christina Ottrando
Senior Thesis
BU 400 Thesis and Practicum
Nicolais School of Business
Wagner College
Spring 2021
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�Big Tech, Big Profits, and an Addiction to a Black Mirror
Abstract
This paper illuminates a plausible theory suggesting that different types of social media
and social media networking companies (i.e., Instagram, Facebook, Twitter) are deliberately
addicting users to their products for immense financial gain. In particular, it argues that social
media companies are continuing on the path of immense financial growth and show no signs of
slowing down. This paper uses relevant case studies, filings from the U.S. Securities and
Exchange Commission, and graphs to emphasize the hypothesized theory.
Keywords: Social Media, Addictive Behaviors, Cost of Operations, Users, Hour Spent, Research
and Development, Suicide, Depression, Anxiety.
Introduction
Starting in 2003, MySpace became popularized as it was the first recognizable social
media site with over 100 million active users. MySpace was originally founded with the intent of
sharing music and concert dates. However, it soon became a social media sensation as the once
simple site turned complex as users were able to create profiles, post photos and videos, and add
friends.
In September of 2006, the era of MySpace came to an end as Facebook opened its free
website to anyone over the age of 13 to connect with friends, “like” pictures, music, videos, and
articles, share their own relationship status’s, thoughts and opinions, plan events, and establish a
timeline.
Fast-forward to today, Facebook has over 2.7 billion monthly active users (and counting)
with a net worth of $872.13 billion (Facebook, 2021) and is no longer the only networking site
that helps us share our lives. Other sites such as Twitter and Instagram have also made it easy to
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connect with family and friends on a real-time basis. However, social media can be very
influential in both positive and negative ways.
In the current paper, I further explore the social media websites of Facebook, Instagram,
and Twitter. I focus on the research and development of these companies and emphasize how
they are profiting off of their users.
I first begin this paper with a detailed description of social media, Facebook, Instagram,
and Twitter and, second, explain the addiction to social media as it exists in the world today.
Third, I examine the side effects of social media as it has been proven to cause depression and
anxiety based on a survey made by Kingdom's Royal Society for Public Health. This paper is
concluded with a financial analysis of Facebook and Twitter, along with how they are profiting
off of everyone, including you.
Literature review
Introduction to Social Media
What is it?
Social media are forms of electronic communication (such as websites for social
networking and microblogging) through which users create online communities to share
information, ideas, personal messages, and other content, such as videos (Merriam-Webster,
2021). Social Media plays a crucial role in connecting people and developing relationships, not
only with key influencers and journalists covering your company's sector, but also provides a
great opportunity to establish customer service by gathering input, answering questions and
listening to their feedback. Platforms such as Facebook, Instagram, Twitter, and others have
made it possible for individuals to access information at the click of a button. About 3.5 billion
people out of 7.7 billion to be exact (PewResearchCenter, 2019).
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Social Media Companies
Instagram
Instagram is a free photo and video sharing app available on iPhone and Android.
People can upload photos or videos to our service and share them with their followers or with a
select group of friends. They can also view, comment and like posts shared by their friends on
Instagram. Anyone 13 and older can create an account by registering an email address and
selecting a username (Instagram, 2021). In 2010, at the age of 27, Kevin Systrom began building
what today is Instagram. Within a year, 500,000 people a week were signing up for the app's
photo-sharing network. (Forbes, 2012). Fast Forward 11 years, and over one billion people are
currently using the app which is now worth roughly $101 billion (Bloomberg, 2021).
Facebook
Facebook is a social networking site that makes it easy for you to connect and share with
family and friends online. Originally designed for college students, Facebook was created in
2004 by Mark Zuckerberg while he was attending Harvard University. However, by 2006,
anyone over the age of 13 with a valid email address could join Facebook. Today, Facebook is
one of the world's largest social networks, with more than 2.7 billion users worldwide and worth
over $872.13 billion (GCFGlobal, 2021; NASDAQ, 2021). Facebook bought Instagram for $1
billion in 2012, a shocking sum at that time for a company with 13 employees. Instagram today
has over one billion users and contributes over $20 billion to Facebook's annual revenue (CNBC,
2020).
Twitter
Twitter is a 'microblogging' system that allows you to send and receive short posts called
tweets. Tweets can be up to 140 characters long and can include links to relevant websites and
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resources. You can create your own tweets, or you can retweet information that has been tweeted
by others. Retweeting means that information can be shared quickly and efficiently with a large
number of people (UKRI, 2021). The snappy nature of tweets means that Twitter is widely used
by smartphone users who don’t want to read long content items on-screen. Twitter currently has
353 million users and has a market cap of $53.48 billion.
Social Media “Addiction”
The word “addiction” brings to mind alcohol and drugs. Yet, over the past 21 years of my
life, I have witnessed a new type of addiction emerge: addiction to social media. A quote from
The Social Dilemma, “There are only two industries that call their customers “users”: illegal
drugs and software,” sends shivers down my spine. “Internet addiction is known to have the
same pattern as individuals with drug addiction and alcoholism which in pathology has a
negative impact on the lives of individual pathology” (Kavaklı, M., & İnan, E.,2020). We’ve
simply created a world where online connection has become primary. Especially for younger
generations. And yet, in that world, anytime two people connect, it needs to be manipulated by a
sneaky third person behind a screen. So, we’ve created an entire global generation of people who
were raised within a context with the very meaning of communication, the very meaning of
culture, is manipulation” (The Social Dilemma, 2021).
As we move away from having a tools-based technology environment to an addictionand manipulation-based technology environment, the hours spent looking at the screen just
continue to get longer. According to the eMarketing Organization, on average, global internet
users are spending roughly 2 hours and 44 minutes on social media sites every day (2020). This
statistic is strictly time spent on social media and does not include the time spent staring at the
screen when using facetime, texting, taking photos, etc. Individuals from age 16 to 29 are
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spending the most time on social media platforms at 3 hours daily while the average United
States aged adult was spending anywhere from 1 to 2 hours each day. In essence, this means that
the average individual will spend over 6 years of their life on social media (PewResearch,2021).
In 2012, Harvard University conducted a series of experiments that involved hooking up
volunteers to a magnetic resonance imaging machine (MRI) and found that regions of the brain
associated with the reward center were strongly engaged when individuals talked about
themselves. And when people got to share their thoughts with family or friends there was an
even larger amount of energy in the reward center of the brain. In contrast, when these subjects
were told that they could not talk about themselves, there was little to no activity in the reward
part of the brain. This can act as evidence as to why people are constantly revealing so much
personal information on social media platforms such as Facebook and Twitter and enjoy the
attention of it.
These social media websites are not unaware of the harm they are doing to society as they
have purposely sought out ways to make their product more addicting. Just like Tobacco
companies eventually added sugar and menthol to cigarettes so you could hold the smoke in your
lungs longer, Facebook added photo tagging and likes, and Instagram added stories and
actionable insights to keep your fingers scrolling.
During an interview with CBSN, former Facebook executive Tim Kendell, told CBS
News’ that “it all boils down to the social media giant's advertising-based business model, in
which the objective is to get more people to pay attention to your product and to pay attention
longer each and every day” (CBS News, 2020). In summary, these advertising-based business
models are combined with Artificial Intelligence (AI) technology that is constantly evolving and
constantly searching for new ways to get us to look at the screen. Weather this is a notification
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for a new friend joining Facebook, or an old memory on your timeline, these algorithms have
their own goals and own way of pursing them.
There data shines light on the idea that social media usage is connected with serious
mental health issues and tech giants such as Facebook, Instagram and Twitter have done nothing
to address the issue or take any accountability.
Social Media Effects of Mental Health
Depression and Anxiety
Social media has a reinforcing nature. Using it activates the brain’s reward center by
releasing dopamine, a “feel-good chemical” linked to pleasurable activities such as sex, food,
and social interaction. The platforms are designed to be addictive and are associated with
anxiety, depression, and even suicide.
Depression causes feelings of sadness and/or a loss of interest in activities you once
enjoyed. It can lead to a variety of emotional and physical problems and can decrease your
ability to function at work and at home. Anxiety feels different depending on the person
experiencing it. Feelings can range from butterflies in your stomach to a racing heart. You might
feel out of control, like there’s a disconnect between your mind and body (Healthline, 2018).
Based on a 1,500 persons survey ages 14 to 24 made by Kingdom's Royal Society for
Public Health, the result on the negative impact of uncontrolled Instagram usage shows that
Instagram is the worst social networking site which causes a decrease in the quality of sleep,
bullying, FoMo (fear of missing out), low self-esteem, as well as an increase of anxiety and
depression (Kavaklı, M., & İnan, E.,2020).
The anxiety and depression feelings are coming from a “compare and despair” attitude
set by the unrealistic expectations of the app. Although it is natural human instinct to compare
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yourself to others and constantly evaluate yourself, these applications are heightening that ability
with the touch of a button to do so. Instagram’s algorithm puts the most popular posts at the top
of your feed, most of which are posts by celebrities and influencers such as Kim Kardashian,
Kylie Jenner, and Bella Hadid. Then you have young children and adults constantly seeing these
photos and videos that were edited, filtered and morphed for hours thinking this is what a normal
body should look like presenting a false representation of life.
The chart below presents the negative psychological effects that social media usage has
on our metal health leading to depression and anxiety.
Figure 1: Negative Effects of Social Media on Your Mental Health
Eating Disorders
In 2019, Instagram had to introduce a new set of rules regarding the promotion of diet
products and cosmetic surgery after a BBC news report declared that eating disorder content on
Instagram was out of control after noticing children were sending graphic images of weight loss
and advice on how to make eating disorders more extreme.
In an online survey conducted by the United States National Library of Medicine
National Institute of Health, 680 social media users were assessed using their social media usage,
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eating behaviors, and orthorexia nervosa symptoms, an eating disorder that involves an
unhealthy obsession. “Orthorexia symptoms are associated with healthy lifestyle choices such as
eating more fruit and vegetables, eating fewer white cereals, shopping in health food stores,
exercise, and reduced alcohol consumption. But orthorexia nervosa is also associated with
significant dietary restrictions, malnutrition, and social isolation” (United States National Library
of Medicine National Institute of Health, 2017).
The results of this experiment directly correlated higher Instagram usage with a greater
tendency toward orthorexia nervosa and unhealthy eating habits. This result can be due to the
fact that #fitinspiritation tagged photos on Instagram tend to show images of thin and toned
bodies with objectifying elements. These findings highlight the implications that social media are
causing for the psychological wellbeing of many individuals.
Financial Analysis of Social Media Companies
Facebook
As the economy contracts and many companies struggle to survive, the biggest tech
companies are amassing wealth and influence in ways unseen in decades.
On May 18th, 2012, Facebook Inc. (FB) shares hit the public market trading on the
Nasdaq Exchange (NASDAQ) with an initial public offering price of $38 per share (Yahoo).
Becoming a public company is the process of taking a private company public and issuing stock
to investors who would like to invest in the company. The offering of stock is “the foremost
important channel of new capital flow to young companies” (Gregoriou). A shareholder is a
person, company, or institution that owns at least one share of a company's stock, which is
known as equity. The company’s most important goal is to maximize shareholder wealth which
stems from dividends and price appreciation. To make these two things happen the Chief
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Executive Officer (CEO) must develop long term strategies, implement the right processes and
create a plan to see what the company needs to do on a day-to-day basis. If a company follows
this process to the end, it should lead to the maximization of shareholder wealth. Companies
such as Facebook contribute their success to their day-to-day operations and their financial
statements which show they are able to maximize shareholder wealth.
Facebook is one of the five largest publicly traded companies in America and rose 37
percent in the first seven months this year, while all the other stocks in the S&P 500 fell a
combined 6 percent, according to Credit Suisse (Eavis, P., & Lohr, S., 2020). “The performance
of social media stocks is not associated with macro-level sentiment, but rather with firm-level
attention paid by potential investors” (Chiou, W.-J. P., Knewtson, H. S., & Nofsinger, J. R.,
2019). And currently, Facebook's stock is worth $306.21 and shows no sign of slowing down.
During the first three months of 2021 Facebooks revenue rose to $26.17 billion, a 48%
increase from the end of 2020. Net income has also increased by almost 100% rising to $9.5
billion. And basic earnings per share (EPS) increased from $1.72 to $3.34. Facebook’s total
assets, total liabilities, and total equity have also seen a consistent incline from the beginning of
2020 to today, according to the U.S. Securities and Exchange Commission (SEC).
Facebook’s day-to-day success is based on their ability to effectively implement the ten
strategic decision areas of operations management (OM) seen in the table below.
Table 1: Facebooks Ten Decision Areas of Operations Management
The Ten Decision Areas of Operations
Management
1. Design of Goods and Services
2. Quality Management
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How Facebook Achieves the Ten Decision
Areas of Operations Management
• Continuous innovation of new
products and abilities.
• Implement suitable human resource
policies.
�Big Tech, Big Profits, and an Addiction to a Black Mirror
•
•
•
•
3. Process and Capacity Design
•
4. Location Strategy
•
•
5. Layout Design and Strategy.
•
•
•
•
•
•
6. Job Design and Human Resources
•
7. Supply Chain Management
•
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Address issues based on user
experience
Collect customer feedback daily.
High quality servers.
Uses code ownership to make sure
each developer is personally
responsible for the quality of their
own work.
Online AI technologies facilitate
efficient dissemination of data among
work teams in the company’s
facilities.
Keeps its headquarters near the best
talent pools and markets such as
Silicone Valley in California known
for cloud computing technology.
Overseas offices are put in place for
easy access to the cheap labor market.
Employees are empowered to take
control of their workspaces.
Employees are allowed to bring in
artists, designers, and friends to design
the office space and walk around.
Cultural artifacts are used all around
the building to inspire designers.
No cabins or cubicles.
Cafes, ice-cream shops, banks, and
restaurants are placed all along
Facebook’s campus.
Free lunch and snacks at its offices
Facebook, uses interns, new graduates,
PhD, and early-in-career hires to shape
the future of the company.
The company’s headquarters are
centered flooded with endless access to
equipment supply, the labor market,
energy, and top of the line
environmental operational conditions.
�Big Tech, Big Profits, and an Addiction to a Black Mirror
8. Inventory Management
•
9. Scheduling
•
•
•
•
10. Maintenance
•
Uses just-in time (JIT)
inventory system which is a
management strategy that has a
company receive goods as close as
possible to when they are actually
needed, similar to Amazons delivery
system.
Flexible scheduling to ensure
employees comfortability.
Four months of paid time off for new
mothers and fathers
A wellness allowance to finance gym
membership or other healthy activities
An extensive healthcare plan for each
employee.
Takes advantage of the environment
around its offices to keep costs low.
For example, the Sweden data center
capitalizes on the country’s cold
climate to minimize maintenance cost
of the building.
Thompson, Andrew (2022). 10 Critical Decisions of Operations Management. 10 Critical
Decisions of Operations Management | Kettering University Online.
https://online.kettering.edu/news/2016/09/21/10-critical-decisions-operations-management.
Twitter
On November 7th, 2013, Twitter Inc. (TWTR) shares hit the public market trading on the
NASDAQ with an initial public offering price of $44.90 per share (Yahoo). For Twitter, millions
of users who have been quarantined in their houses due to COVID-19 have caused a spike in the
social media company's traffic and user sign up. However, due to the shutdown of many
businesses, Twitter’s mainstream of revenue coming from selling advertisements has seen a
decline (Twitter, 2020). Despite this, Twitter still managed to pull a powerful price move to beat
earning expectations in Q1 2020 ending March, delivering adjusted earnings per share (EPS) of
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$0.11 compared to a consensus estimate of $0.10. In addition, Twitter's stock price is currently
worth $67.00 despite its ups and downs in the past year (NASDAQ, 2021). Twitters successful
day-to-day operations is also based on their ability to effectively implement the ten strategic
decision areas of operations management seen in the table below.
Table 2: Twitter’s Ten Decision Areas of Operations Management
The Ten Decision Areas of Operations
Management
1. Design of Goods and Services
How Twitter Achieves the Ten Decision
Areas of Operations Management
•
Continuous innovation of new
products and abilities.
2. Quality Management
•
Models its company off of creativity,
empathy and global business.
3. Process and Capacity Design
•
AI technology determine what tweet
recommendations to suggest on users'
timelines.
4. Location Strategy
5. Layout Design and Strategy.
6. Job Design and Human Resources
7. Supply Chain Management
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•
Employees work from home
permanently as it increases
productivity and provides a better
work-life balance.
• Employees work from home
permanently.
• Does not target specific companies or
competitors from which to hire
people.
• Does not conform its hiring to
individuals who have certain types of
degrees from a specific list of colleges
and universities
• Focus on specific skill sets and talents.
• Ensures a positive candidate
experience.
• Cloud-based services connect everyone
in the supply chain, providing a more
�Big Tech, Big Profits, and an Addiction to a Black Mirror
8. Inventory Management
9. Scheduling
•
•
10. Maintenance
•
strategic approach for inventory
deployment and improvement.
Collect their own data.
Working from home allows for flexible
work hours.
Twitter's plans
to work from home indefinitely cut
costs for both the employees and
company.
Thompson, Andrew (2022). 10 Critical Decisions of Operations Management. 10 Critical
Decisions of Operations Management | Kettering University Online.
https://online.kettering.edu/news/2016/09/21/10-critical-decisions-operations-management.
Profiting Off Our Addiction
The primary way social media companies like Facebook and Twitter make money is
through selling advertising. The concept of selling advertising while offering a free service is not
new. This means that every time you log onto a social media platform, and click, look at, or like
anything, AI technology collects this data which is then sold to other companies without our
permission. For example, almost all of Twitter's revenue - about 85% of it - comes from
advertising on its site (Tse, T. C. M., 2018). However, social media companies have jumped
from selling advertising to selling our personal information. “Based on the theoretical
perspective presented using CPM, four main constructs for measuring users ‘concern for
information privacy on social media platforms are introduced, including 1) unauthorized access
and secondary used of personal information—information access, 2) information collection—
collection, and 3) erroneous storage and representation of personal information—errors”
(Bennet, A. 2014).
Hypothesis
H1: Social media companies are deliberately addicting users to their products.
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H2: Social media companies are continuing on the path of immense financial gain.
Methods
Subjects
Subjects include some of the roughly 3.96 billion individuals who use social media,
which accounts for roughly half of the global population (Digital Marketing, 2020).
Subjects
Social Media Companies
Facebook, Twitter, and Instagram
Cost of Operations
Research, Development, Marketing and Sales
Measures
Variables will include the time users spent on Facebook, Instagram, and Twitter
(Coombe, Curtis & Orlowski, 2021). Variables will also include the cost of Facebook, Instagram,
and Twitter research and development, and marketing and sales departments, and profit from the
date of the companies’ founding to 2021 Data will be gathered from each company's annual
report filed under the U.S. Securities and Exchange Commission (SEC).
Analysis will examine changes in the cost of operations, profit, and the time users spent
on Facebook, Instagram, and Twitter. Analysis will examine whether Facebook, Instagram, and
Twitter endorse, research, and create addictive behavior. Analysis will determine whether
individuals are spending more time on Facebook, Instagram, and Twitter, leading to each
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company’s upward profitability trend. Data will also be gathered on the number of individuals
currently signed up in that year.
Table 1: Components of Study
Variables
Time Spent by
Individuals
Cost of
Operations
(Research and
Development,
and Marketing
and Sales)
Centers for
Disease and
Control
Prevention
Statistica
Company Data
Securities and
Exchange
Commission
Filings
Data Source
Facebook,
Instagram,
and Twitter
Centers for
Disease and
Control
Prevention
Statista
Database
company
Securities and
Exchange
Commission
Filings
Annual
Growth Rate
Securities
and
Exchange
Commission
Filings
Securities
and
Exchange
Commission
Filings
Type of data gathered
Qualitative
Quantitative
Quantitative
Quantitative
Qualitative
Social Media
Company
Suicide Rate
Instrument
Facebook,
Instagram,
and Twitter
Data
Company
Number of
Average Hours
Annual
Types of scores produced
Name
Deaths
Spent
Revenue
Profit
Adapted from: Rudestam, K.E. & Newton, R.R. (1992). Surviving Your Dissertation. Newbury Park, California:
Sage Publications, Inc. page 140.
Hypothesis
H1: Social
media
companies
are
deliberately
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Table 2: Hypothesis, Instruments, and Statistical Analysis
Instrument
Cost of
Operations
(Research and
Social
Time Spent Development, Annual
Hypotheses
Media
by
and Marketing Growth
Variable
Company
Individuals
and Sales)
Rate
Relationships
Statistical Test
Social
Media
Company
Correlation;
regression; line
charts
Time Spent
by
Individuals
Cost of
Operations
Cost => Time
Profit
�Big Tech, Big Profits, and an Addiction to a Black Mirror
addicting
users to their
products.
H2: Social
media
companies
are
Social
continuing on
Media
the path of
Company
Profit
Cost =? Time=>
immense
Social
Time spent
Profit
Correlation;
financial
Media
by
Cost of
regression; line
gain.
Company
individuals
Operations
charts
Adapted from: Rudestam, K.E. & Newton, R.R. (1992). Surviving Your Dissertation. Newbury Park, California:
Sage Publications, Inc. page 140.
Procedure
In conducting this study, I did extensive research on these three social media companies
while analyzing their financial filings under the U.S. Securities and Exchange Commission
(SEC). I also found peer reviewed articles and case studies that provide evidence when showing
the negative side effects of social media on mental health and the continuous increase of social
media companies profitability.
Data was collected by using the following databases, Business Source Premier as well as
EBSCO Discovery Service. From there I used the search terms, Facebook finances, Instagram
finances, Twitter finances, U.S. Securities and Exchange Commission in their connection to
addictive behaviors, suicide, depression, anxiety, and eating disorders such as orthorexia nervosa
symptoms. Other sites used were The Wall Street Journal, Forbes, Fox News, ABC, CNN,
Yahoo Finance and the New York Times. These articles provided knowledge on the respective
company.
From the above articles and documentaries, I analyzed the addictiveness of social media
and how it was continuously impacting our mental health in more than one negative ways
throughout the years leading up to today. From there, I analyzed a study done by the Centers for
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Disease Control and Prevention on U.S. Suicide Rates in Pre-Teen Girls from1999 to 2017.
Furthermore, I was able to perform a financial analyzation of the Annual Revenue of Twitter and
Facebook from 2009 to 2020 and present the issue that they are continuing on a path of financial
growth with few signs of slowing down. And lasty, I created a line graph that represents the
number of social media users against the suicide death rate of individuals from 15-19 years of
age.
Results
Continuous Profits
Figure 2: Annual Revenue of Twitter and Facebook, 2009 to 2020
Source: U.S. Securities and Exchange Commission
This chart presents the persistent growth of Facebook and Twitters annual revenue from 2009 to
2020.
Dying for Likes
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Deaths (Per 1,000,000
Females)
U.S. Suicide Rates
60
50
40
30
20
10
0
1999 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Year
US Suicide Rates Girls 10-14
US Suicide Rates Girls 15-19
Figure 1: U.S. Suicide Rates in Pre-Teen Girls, 1999 to 2017
Source: Centers for Disease Control and Prevention
Figure 1 shows a gradual increase in the suicide rates of Pre-Teen Girls from ages 10–14 and 1519.
Killing for Profits
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Figure 2: Annual Revenue of Twitter and Facebook, 2009 to 2020
Source: U.S. Securities and Exchange Commission
This chart presents the persistent growth of Facebook and Twitters annual revenue from 2009 to
2020.
The Link
Figure 3: Number of Social Media Users on the Rise with Suicide Rates
Source: Centers for Disease and Control Prevention, 2018 and Pew Research Center, 2021.
The chart above presents the comparison in the number of social media users against the suicide
death rate of individuals from 15-19 years of age.
Discussion
The results of Figure 1 indicate that suicide rates have soared over 150% in the United
States in Pre-Teen Girls from 1999 to 2017. The largest spike in this data can be seen after the
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year 2009 when social media was available on all devices. In 2008, the suicide rate of preteen
girls from 15-19 was 32 individuals and 5 for preteen girls ages 10-14. These numbers are
heavily increased and some almost doubled as 2016 saw rates of 53 (Ages 15-19) and 17 53
(Ages 10-14).
Different types of social media and social media networking companies in Figure 2 (i.e.,
Instagram, Facebook, Twitter) are seeing persistent growth in their annual revenue as they are
thriving financially off of the social media addiction created. Facebook and Twitter have both
gone from making $1 billion in a year to roughly over $90 billion.
The thesis results in Figure 3 also show a correlation as more and more individuals are
suffering from depression leading to suicide, companies like Facebook and Twitter are thriving
financially off of the addiction.
This is where I want to draw the connecting line between social media addiction,
negative mental health effects, and social media companies’ profits.
Conclusion
This study explained the different types of social media and social media networking
companies (i.e., Instagram, Facebook, Twitter) and uncovered the success behind them as it
relates to their day-to-day operations, and shareholder wealth using the ten strategic decision
areas of operational management. It proposed the idea that social media usage is linked to
negative mental health effects. In addition, it showed the persistent growth of Facebook and
Twitter’s annual revenue over time. Lastly, it discovered the link between the number of suicides
in young adults and the number of users signed up for social media networking sites. Moreover,
this study sheds light on the true nature of social media companies as they are deliberately
addicting users to their products for financial success.
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�Big Tech, Big Profits, and an Addiction to a Black Mirror
Thank you for such an amazing and challenging semester. Best, Christina.
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Orthopedics & Bone Disorders,1(7). doi:10.23880/jobd-16000139
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Article 22.
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the United States. Pew Research Center: Internet, Science & Tech.
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Media Giant – a Case Study. Journal of Security & Sustainability Issues, 10(2), 683.
Thompson, Andrew (2022). 10 Critical Decisions of Operations Management. 10 Critical
Decisions of Operations Management | Kettering University Online.
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�
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Big Tech, Big Profits, and an Addiction to a Black Mirror
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Substance Use Disorder, Job Performance, and Productivity
Does active addiction affect performance and productivity in the workplace?
Amanda Gavrity
Senior Thesis
BU 400 Thesis and Practicum
Nicolais School of Business
Wagner College
Spring 2020
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Substance Use Disorder, Job Performance, and Productivity
Abstract
This analysis of research is to determine if Substance Use Disorder negatively effects job
performance and productivity. With today’s rising opioid epidemic, we take a look into SUD and
what it means to have an SUD, we take a look into the effects of SUD and look into research that
looks into poor job performance and productivity and does SUD have any relationship to this.
Based on data and research collect little research states that there is no correlation between
having an SUD and poor job performance and productivity. Further analysis shows that there is a
correlation but there needs to be more current research due to the current status of SUD in the
United States. Research also shows that there is a need for more in depth research for this topic
due to the opioid epidemic and COVID-19 pandemic to further analyze the effects that these two
events have had on the work force when it comes to mental health specifically SUD. This thesis
will take a look into addiction, job performance, and productivity and what impact one has on the
other.
Introduction
Not many people understand the complexity of addiction and how many different
addictions there are in the world. The focus of this thesis is Substance Use Disorder. Substance
Use Disorder does not discriminate, it can affect anyone of any race or financial background.
Twenty-seven million Americans’ reported use of an illegal substance in 2015, and over
sixty-six million reported drinking excessively within 30 days. Seventy-eight people die every
day in the United States from an opiate overdose number have increased significantly since 1999
(Keane, 2018). The estimated yearly economic impact of Substance Use Disorder is $249 billion
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Substance Use Disorder, Job Performance, and Productivity
for alcohol and $193 for drug use (Keane, 2018). The long-term effects on society can include
reduced productivity, higher health care costs, unintended pregnancies, spread of infectious
disease, drug-related crime, interpersonal violence, stress within families and many other things
(Keane, 2018). The focus of this thesis is on productivity and performance in the workplace.
People try to contemplate SUD and how can we fix the problem? A lot of society's
answer for addressing SUD is to incarcerate individuals with SUD. Due to further research on
SUD society looking to rehabilitation rather than punishment (Wagner, & Sawyer 2018). There
are many new ways to help employees with an SUD such as EAP (employee assistant programs)
programs. Research over the years has tried to determine if having an SUD negatively effects job
performance and productivity, but what are we doing with the research and are we trying to find
a resolve for the issue if there is one present.
Literature review
Addiction/Substance Use Disorder
Few people understand what Substance Use Disorder/Addiction is. Addiction is a brain
disease(Keane, 2018). Symptoms of this disease are drugs and/or alcohol despite the negative
effects of using the substances. Many substances can result in an addiction, and many people do
not understand when the use of a mind- or mood-altering substance becomes problematic, which
occurs when the life of the person becomes unmanageable due to the negative consequences of
their substance use, yet they continue to use (Keane, 2018)
There is a difference between active addiction and recovery. Someone in active addiction
is using a substance such as drugs and/or alcohol and continues to use these substances even
though their life has become unmanageable and negatively affected by their drug and/or alcohol
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Substance Use Disorder, Job Performance, and Productivity
use. Someone in recovery from active addiction has not used a substance for several weeks,
months, or years and is working towards improving their life. Recovery is a broad term and
requires far greater work than ceasing use of the substance. Recovery entails working on
changing old addictive attitudes and behaviors as well as dealing with the negative consequences
of their former substance use (Keane, 2018).
Parts of an individual’s life affected by Substance Use Disorder are family, employment,
social interactions, hygiene, self-care, finances, legal issues, education, and simple everyday
tasks. Standard treatment for addiction/Substance Use Disorder are rehabilitation programs,
individual and group therapy, self-help groups, and medically assisted treatment combined with
therapy (Keane, 2018).
Using a substance recreationally and SUD are two very different situations. Using a
substance recreationally is only once in a while it is not every day and there is no physical and/or
mental dependence to the drugs. SUD has certain criteria that can be found in the DSM-5. The
criteria for an SUD are one hazardous use, social or interpersonal problems related to the use,
neglected major roles to use, withdrawal, tolerance, used larger amounts, used longer than
intended, repeated attempts to control or quit, much time spent using, physical or psychological
problems related to use, activities given up to use, and cravings (American Psychiatric
Association, 2017).
Job performance and productivity
Productivity is quality of work and quantity of work. Job performance consists of
attendance at work and tardiness, reliability and accountability, and turnover. If employees have
a good work ethic and their job performance meets company standards, then company profits
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Substance Use Disorder, Job Performance, and Productivity
and benefits. Job performance is important for employees to enable them to move up in a
company and for references for future job opportunities. Productivity is important for a business
to be profitably and successful.
Substance Use Disorder (SUD) is believed to impact productivity negatively. Individuals
with substance use disorder have 50% more absenteeism than other employees (Benham, 2017).
This absenteeism affects the employer because often the employer has to pay the replacement
employee overtime wages and also pay sick leave for the employee who has taken off due to
SUD (Benham, 2017). Types of absences related to substance use include arriving late, leaving
early, taking half a day at work, unreliability to follow one's work schedule along with
alcohol-related presenteeism which means coming into work impaired such as having a hangover
or being intoxicated (Buvik, 2018). SUD can result in absenteeism, accidents, as well as a slew
of other issues in the workplace, which in turn can damage the stability of the company (Elliott
& Shelley, 2006). In 2001 Atkinson indicated 14 million Americans using substances who are
employed are 3.6 times more likely to be involved in an accident and 5 times more likely to file
for workers’ compensation benefits (Elliott & Shelley, 2005). This has an effect on not only the
company as a whole but the coworkers too. Some researchers suggest there is not a relationship
between substance use and productivity, however, the research does not state whether or not
these individuals suffer from an SUD (Hickman, Finke, & Miller, 1990).
Workers who have SUD also have a higher turnover rate than other workers, however,
workers who are in recovery and treating their SUD are least likely to leave their employers.
(Benham, 2017). Workers who have been treated for SUD have a better job performance as well
as job productivity than those who have an untreated SUD. Workers who are in active addiction
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Substance Use Disorder, Job Performance, and Productivity
have shown to have multiple employers within a year. (Benham, 2017). The cost of replacing a
worker varies upon the job, and includes costs of recruitment, retraining a new person, and time
spent by the company to accomplish this (Benham, 2017).
Research has shown that individuals who have an SUD are usually addicted to more than
one substance, however, if alcohol is the primary substance, then they are less likely to be
addicted to and/or use another substance. (Benham, 2017). One of 10 American workers has
impaired productivity from substance abuse (Conry, 1991). Based on studies between 2000 and
2002 workers who have had intervention on behalf of an EAP (employee assistance program)
had a lower rate of recordable incidents at work than the general population group (Elliott, &
Shelley, 2005). The research suggests that there is no difference between the number of
incidents, which vary, between users and nonusers (Elliott, & Shelley, 2005). Further research
suggests employees with positive drug tests had a higher accident rate and post-treatment only
data suggests employees with positive drug tests had a substantial decrease in accidents after
treatment (Elliott, & Shelley, 2006).
Employees who have an SUD are more likely than employees in recovery and or the
general workforce to have anxiety and depression. (Benham, 2017). Anxiety and depression can
affect someone’s job performance as well as the severity of their SUD. Mental health comes into
play when SUD is involved and, in some cases, can be the cause of anxiety and depression.
SUD is classified as a mental health disorder according to the DSM-V.
When looking into further research inexperienced users are more likely to have issues at
work as well as those who need to increase their use due to tolerance (Frone, 2013). Frone looks
at a lot of studies that were conducted and compares results, however he concludes that there is a
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Substance Use Disorder, Job Performance, and Productivity
lack of accurate research due to the fact that individuals do not relatively self-disclose out of fear
of the stigma attached to using substances. It is not clear whether workers have an SUD or not in
these findings as well.
SUD can affect job performance in different ways. Employees with an SUD are more
likely to come to work under the influence of a substance therefore they are more likely to
perform job tasks (Lehman, & Simpson, 1992). Employees are less likely to attend or
concentrate on their job which could lead to daydreaming, putting less effort into job tasks, and
distracting other employees with conversations that are irrelevant to the job (Lehman, &
Simpson, 1992). Research suggests that another way SUD can affect productivity is that an
employee will spend work hours trying to mend a hangover and/or withdrawal symptom from
drug use (Lehman, & Simpson, 1992). Researchers believe that SUD is not the only factor that
affects productivity and job performance but is a significant variable (Lehman, & Simpson,
1992). In 2001 Atkinson indicated 14 million Americans using substances who are employed are
3.6 times more likely to be involved in an accident and 5 times more likely to file for workers’
compensation benefits (Elliott & Shelley, 2005).
A survey conducted of 300 nurses in the United States with an SUD had reported that
their SUD had a significant impact on their job performance and resulted in disciplinary action
(Sullivan, 1990). The employees reported obvious signs were lack of attendance, poor job
performance, example of these in the nursing field are illegible charting, numerous mistakes,
behaviors related to dispensing medications and increase in incidents, and frequent bathroom
breaks (Sullivan, 1990). The nurses also answered about their time in recovery after treatment
93% of the 300 nurses have reported that they regularly attend self-help groups and the average
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Substance Use Disorder, Job Performance, and Productivity
time in recovery was 4.3 years (Sullivan, 1990). All of the nurses in this study were deemed
successful with their treatment after having disciplinary action.
There are many different ways for the individual to treat their SUD but employers also
have options to assist workers with an SUD. Some businesses offer intervention and treatment
with the possibility of further employment after treatment (Elliott, & Shelley, 2005). Research
suggests that for people living with an SUD effective treatment must involve both them and their
work (Milloy, 2019). For example, people can enroll in the C.H.I.P (Curb Heroin in Plants)
program, which was designed to create a change by addressing SUD with addressing work and
family life (Milloy, 2019). Research suggests that C.H.I.P is an effective method to look at
history and reevaluate employee assistant programs and where this program faltered (Milloy,
2019). This research goes into the C.H.I.P program further and tries to look into why the
program has failed and what changes could be made to increase the success rate of the future
programs(Milloy, 2019). C.H.I.P was meant to help with Medically Assisted Treatment along
with therapy for individuals with SUD. This program was desinged to assist employees who
were addicted to heroin who worked in plantations.
This thesis paper addresses the issues of Civic engagement and Civic professionalism
because of the 3rd United Nations’ Sustainable Development Goal, which is Good Health and
Well-being as well as the 10th SDG which is Reduce Inequality. The communities affected by
my thesis subject are those with people who are suffering from a Substance Use Disorder who
have not received treatment, people who have received treatment, and employers. Based on
personal experience along with research conducted for this paper, it is evident to me that society
can be cruel especially, the people who are uneducated about SUD. Recovery is possible and it
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Substance Use Disorder, Job Performance, and Productivity
goes hand-in-hand with goal number three (.i.e., Good Health and Well-being). Research has
proven that people in recovery have better job performance and productivity in the workplace
than people who are not in recovery have. Goal 4 Quality Education is also important because
people with SUD are strongly stigmatized. For example, I used to be extremely uneducated in
the field of addiction and I stigmatized people who I thought were alcoholics and/or drug addicts.
The needs of people who have an SUD are for people to have a better understanding of the
disease and to understand that recovery is extremely difficult to accomplish, especially because
addiction is frequently accompanied by mental health disorders (Drebing, Fleitas, Moore,
Krebs, Ormer, Penk, Rosenheck, 2002).
When I disclose my past to people, it gives people a bad impression of me as an
individual, but the person I was when I was using substances is not the person I am in recovery. I
am one of the fortunate ones to get past my active addiction and be in recovery for 2 plus years,
but not everyone is as fortunate as I am or has a support system like I do. I just hope that my
thesis topic and paper can change one person's mind about people in active addiction as well as
people in recovery. I would not be here in this class today if someone did not look past the
stigma attached to addiction and provided me with an opportunity to dramatically change my
life. Recovery does not just benefit the person who has the SUD, but it also benefits people in the
recoveree’s life whether it be family or employer. We need more people to look past the stigma
and try to help people who reach for recovery not try to push their hand away and beat them up
any more than they have beaten themselves.
Hypotheses
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Substance Use Disorder, Job Performance, and Productivity
Addiction to narcotics and/or alcohol has a negative effect on employees' job
performance and productivity.
Method
Subjects: Employees who have an addiction to narcotics and or alcohol.
Measures: Attendance, sick leave, and turnover of employees with and without a SUD.
Procedure: I used the Horroman Library search engine and used the interlibrary loan and
document delivery system. I selected the peer reviewed article option and used One Search. The
search terms I used to find the materials are the following: Substance Use Disorder; job
performance; productivity; addiction; substance abuse; drug use; and workplace. I went on to the
OASAS (Office of Addiction Services and Supports) and SAMHSA (Substance Abuse and
Mental Health Services) websites and retrieved a document from there.
Results
Addiction to narcotics and/or alcohol has a negative effect on employees' job
performance and productivity. Even though some of the data found showed no relation between
addiction and job performance and productivity most of the data has shown that it indeed does
affect it negatively. Unfortunately, there was less research found on people in active addiction
versus those in recovery from addiction and job performance and productivity.
There are significant data charts from the National Survey on Drug Use and Health for
the cost of employers for workers who have been treated for an SUD versus those who have not
(Benham, 2017). figure 1 shows the workforce participants in the survey, figure 2 shows the
employers per capita healthcare costs, table one shows the demographics of workers in figure 1,
table 2 shows the industries represented in the NDSUH (National Survey on Drug Use and
�10
Substance Use Disorder, Job Performance, and Productivity
Health), table 3 are the rates of substance use disorders by industry, Table 4 show the workers in
recovery have the lowest turnover and absenteeism rates, table 5 shows the health care use of
people with specific substance use disorders to a specific substance, table 6 shows the correlation
between nicotine and behavioral health, table 7 shows the extra cost of missed work by industry,
table 8 shows the turn over costs by industry, table 9 showed the per capita costs to employers
for each untreated worker with an SUD, and table 10 shows employer costs avoided for each
worker in recovery. All these tables are important to understanding the cost of an employee with
an SUD in recovery, an employee in active addiction, versus the general population.
Discussion
Addiction/Substance Use Disorder
Importance of understanding the difference between active addiction vs recovery, why
would this be important. Someone who is in active addiction is not working on this in their life
that is falling apart along with working on themselves internally. If someone does not want to
change and go into a life of recovery. Knowing the difference is important because former drug
users can change their job performance and productivity. Based on the research and the data
provided, people in recovery have a better job performance and productivity than those in active
addiction.
The importance of understanding addiction, especially for employers, is important from
a social standpoint and will help employers and society as a whole address the disease with an
effective strategy rather than shunning an individual with SUD. Effect of addiction/ substance
use disorder on job performance and productivity. Let’s take a look at what parts of life addiction
effects for an individual suffering from SUD. According to DSM-V it effects every aspect of an
�11
Substance Use Disorder, Job Performance, and Productivity
individual’s life, personal, inter-personal, social aspects, legal issues, employment relationships,
financial, etc.
The importance of understanding the difference between a recreation user and someone
who is suffering from an SUD is important because there is a different way to address the
situations. Someone with an SUD has specific needs that someone who is a recreational user
does not have. Treatment is important for someone with an SUD it is the foundation of starting
the recovery process, whether it be self-help groups, medically assisted treatment coupled with
therapy or private therapy. It is vital for an individual’s recovery from SUD.
Job performance and productivity
Productivity is important for a company to be successful and productivity is different for
companies in different industries. The effect of poor job performance is wide spread amongst a
company. Poor job performance effects fellow coworkers as they have to pick up the slack and it
effects the employers in numerous ways as well. Turnover rates, overtime costs, and paid sick
leave are all outcomes of poor job performance as expressed in the research provided along with
many other things. Based on the research and the tables provided SUD has a significant effect on
job performance and productivity. There is a need for further research on the effects of job
performance and productive with regard to employees in active addiction versus those in
recovery.
Conclusions
Implications for practice
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Substance Use Disorder, Job Performance, and Productivity
Employers need to find a way to become educated on addiction. Lack of education about
SUD has always been a contributing factor to the stigma attached to SUD. The implications for
this research are to help show that addiction needs to be treated as more of a health issue rather
than believing people with an SUD are bad people. People with an SUD and in recovery are very
determined to change their lives and that includes their professional life. When people in
recovery have support in all aspects of their lives the success rate goes up tremendously. Based
on some of the research founded in during this search it has shown that individuals in recovery
do have better job performance.
It would benefit the employer to treat employees with an SUD rather than fire them. Many
individuals do not see people with an SUD as people until the issue hits closer to home. Not all
but some U.S. Businesses have realized the importance of intervention which is where the
employee assistance programs (EAP) come into play. (Elliott, K., & Shelley, K. 2005). There are
not enough employers practicing these things. How would you feel if it was your daughter, your
son, your brother, etc. who had an SUD? Would you help them succeed or would you turn your
back on this person? Unfortunately, due to the stigma attached to addiction it is extremely
difficult to ask for help or reach out for it.
Not only is this an important to have a protocol set in place to assist someone who has an
SUD rather than dismiss them, but due to the increasing drug epidemic in the United States it
would only make sense to have a protocol set in place. With the pandemic COVID-19 during the
Opioid Epidemic there is a sever concern for the rise of addiction. Not only addiction from
substances but other addictions may come in to play along with additional mental health issues.
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Substance Use Disorder, Job Performance, and Productivity
Have you ever thought of the repercussions of isolation? Human beings are meant to be social
beings.
There are laws set in place now that help people with SUD when it comes to employment.
People who suffer from an SUD normally have an arrest record. While on a job interview the
employer is not allowed to ask you if you have been arrested or incarcerated, however, upon
hiring they can run a background check so is it better to self-disclose? The problem with this is
due to the lack of education on active addiction as well as people in recovery this can be an
obstacle for individuals especially if they are working towards changing their lives and
participating in a life of recovery. Not only that it is hard to self-disclose with such a stigma
attached to drugs addiction and if you’re sitting there reading this and do not understand what I
mean by stigma let me ask you this one question: When I say drug addict or alcoholic what
picture comes to mind? There are so many different names attached to the word addict; junkie,
loser, failure, lowlife, trash, criminal, moral deficiency, and so on an so forth.
Companies should to be more progressive especially with the opioid epidemic and now the
COIVD-19 pandemic, employers need to start thinking about the possible wreckage that it will
leave behind not to mention a way to deal with the opioid epidemic. I cannot even express how
important it is for employers to implement mental health days and SUD falls into the category of
mental health. Drug testing in the work place should not be a tool used to dismiss people but to
hold employees accountable and then inform them that the company will help them receive
assistance for their SUD and it would be contingent on their future employment. Not to mention
that the data presented has shown that it is more cost effective for the company then letting
someone go from the company.
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Substance Use Disorder, Job Performance, and Productivity
Companies could work closely with the treatment facilities and therapist for individuals with
an SUD to make sure that they are at a level where they can return to work and be successful in
recovery. Recovery is about balancing every aspect of your life along with changing everything
you use to do in active addiction. Understanding can help the company and the employee
suffering from the SUD. SUD is not something that is fixed overnight it is a constant battle and
struggle long term treatment is essential for the success of someone suffering from an SUD and
for the success of the company as well.
Implications for research
There should to be more research based on people who are in active addiction versus
those who are in recovery compared to the general population. There was not enough research on
before recovery and after recovery during my search for research for this thesis. Doctors need to
be more educated as well to the prescribing of medication. I am in recovery for over two years
now and when I had gone to get my gallbladder removed I had expressed that I did not want any
narcotics and when I was in recovery they had administered narcotics because that was what the
doctor ordered and there was nothing else they could give me. Now for me this was not an issue
because I had worked on the major things I needed to work on with therapy and SUD treatment
but this is not the case for everyone.
Education is key for a lot of issues that need to be resolved when it comes to the issue of
SUD. Educating the younger generation for prevention as well as educating older generations to
reverse the stigma attached to an individual with SUD. Education is so important especially for
prevention right now. There needs to be research conducted for some type of analysis with
�15
Substance Use Disorder, Job Performance, and Productivity
companies and individuals who are educated in addiction versus those who are not educated on
SUD.
Another aspect that requires more research is the effects that the current pandemic has
had on individuals especially in the workforce. How have people been coping with the loss of
work? What about the essential workers? How are they coping with the devastation that some
have witness? Are they turning to unhealthy methods to cope with the traumatic experiences
from the pandemic? How are we helping as a society?
In conclusion, with all the research found supporting this thesis and then the research that
finds that there is no relation between SUD, poor job performance and productive there needs to
be more. With all the research and technology available there should be more. I was extremely
taken aback when I did not find more current research on SUD and job performance and
productivity. Especially with the Opioid epidemic to not have a significant amount of research
with this crisis going on is just a little unsettling. A lot of people are dying due to this epidemic
that is going on and most people decide to turn a blind eye or blame the family for the person
who suffered from an SUD. The worst comment that I have ever seen was someone state that one
less lowlife on the streets. The stigma attached to SUD makes individuals who suffer from an
SUD have a secret life it is a shameful thing according to society. There are so many different
addictions out there. Why is there such a stigma attached to SUD?
Especially with the opioid epidemic being so prevalent in today’s world I was surprised
at the lack of research on employees in recovery versus those in active addiction along with job
performance and productivity. Even with the changes to the Human Resource Administration,
People who are on public assistance and have an SUD are required to attend treatment and are
�16
Substance Use Disorder, Job Performance, and Productivity
required to attend their job readiness program along with a whole slew of requirements. It is
required to recertify after 90 days on Public assistance in New York and if they do not attempt to
get employment their public assistants are terminated unless the treatment center they attend
recommends more treatment. There is a data base for this why is it not being utilized in a study.
Society is attempting to work towards understanding and determining a more efficient way to
help people who suffer from an SUD but are any of these methods effective.
Data
FIGURE 1
�17
Substance Use Disorder, Job Performance, and Productivity
Workforce participation.
(Benham, 2017)
FIGURE 2
Employers’ per capita health care costs. (Benham, 2017)
�18
Substance Use Disorder, Job Performance, and Productivity
TABLE 1
Demographics of Workers
Overall US Workforce Pain Med Use Disorder Any Substance Use Disorder
Male
53%
61%
67%
Married
54%
28%
33%
Between 18 and 34 years
34%
66%
55%
Family income below $20K 12%
24%
18%
(Benham, 2017)
TABLE 2
Industry Representation in the NDSUH
BLS 2014 (%) NSDUH (%) Number in NSDUH
Agriculture, forestry, fishing, and hunting 1.4
1.4
1,254
Mining
0.6
0.6
605
Construction
4.1
7.5
15,357
Manufacturing
8.1
10.5
7,380
Utilities and transportation
3.5
5.0
3,032
Information
1.8
2.3
1,386
Wholesale trade
3.9
2.5
1,697
Retail trade
10.2
10.5
10,452
Financial activities
5.3
6.5
4,022
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Substance Use Disorder, Job Performance, and Productivity
Professional and business services
12.7
11.9
8,214
Educational services, health
14.3
22.3
17,294
Leisure and hospitality
9.8
9.3
11,125
Government, public administration
14
4.6
3,118
Other services
4.2
5.6
4,193
(Benham, 2017)
TABLE 3
Rates of Substance Use Disorders by Industry
Any
SUD
Alcohol Use
Disorder
Illicit Drug Use
Disorder
Pain Med and Opioid
Use Disorder
Marijuana Use
Disorder
Entertainment,
recreation, food
15.3
12.1
5.7
1.6
3.5
Construction
15.0
12.4
4.4
1.3
2.3
Wholesale, nondurable
10.6
9.4
2.4
0.7
1.2
Professional, mgmt.,
admin
10.3
8.6
2.7
0.9
1.6
Mining
10.3
9.6
1.0
1.0
0.1
Retail
9.8
7.9
3.3
0.9
2.1
Information,
communications
9.7
8.2
2.3
0.6
1.4
Finance, insurance real
estate
9.1
8.1
1.5
0.3
1.0
Wholesale, durable
8.7
8.1
1.3
0.4
0.9
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Substance Use Disorder, Job Performance, and Productivity
Other services except
publ. admin
8.7
7.1
2.5
1.0
1.6
Agriculture
8.6
7.5
1.7
0.4
1.2
Manufacturing, durable
8.4
7.5
1.5
0.8
0.6
Manufacturing,
nondurable
8.0
6.7
2.1
0.6
1.1
Transportation, utilities
7.5
6.6
1.7
0.6
0.9
Education, health, social
services
6.4
5.4
1.5
0.5
1.0
Public administration
5.7
5.0
0.9
0.5
0.5
Overall average all
industries
9.4
7.9
2.5
0.8
1.5
(Benham, 2017)
TABLE 4
Workers in Recovery Have the Lowest Turnover and Absenteeism Rates
General
Work
Force
Any
SUD
Alcohol
Use
Disorder
Illicit Drug
Use
Disorder
Pain Med
Use
Disorder
Marijuana
Use Disorder
In
Recovery
Missed work days
for injury, illness
past year
8.4
10.2
9.4
13.0
22.2
10.6
8.3
Missed work days
for other reasons
past year
2.1
4.7
4.7
5.4
6.8
4.8
1.2
Total missed work
days past year
10.5
14.8
14.1
18.4
29.0
15.4
9.5
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Substance Use Disorder, Job Performance, and Productivity
Worked for more
than one employer
in last year (%)
25
36
36
42
42
45
23
(Benham, 2017)
TABLE 5
Health Care Use is Highest for People with a Pain Medication Use Disorder
General
Work
Force
Any
SUD
Alcohol
Use
Disorder
Illicit Drug
Use
Disorder
Pain Med
Use
Disorder
Marijuana
Use Disorder
In
Recovery
Hospitalized
overnight last year
(%)
7.4
7.9
7.9
9.5
17.0
8.1
7.3
Hospital nights per
person last year
0.3
0.3
0.3
0.5
0.6
0.5
0.2
Emergency room
visits last year
0.4
0.6
0.5
1.0
2.0
0.8
0.4
Outpatient visits
last year
2.6
2.3
2.4
2.7
3.9
2.5
2.6
(Benham, 2017)
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Substance Use Disorder, Job Performance, and Productivity
TABLE 6
Behavioral Health and Nicotine
General
Work Force
Any
SUD
Alcohol Use
Disorder
Illicit Drug
Use Disorder
Pain Med Use
Disorder
In
Recovery
Serious psychological
distress past year (%)
4
12
11
20
28
3
Anxiety disorder past
year (%)
5
11
11
14
20
6
Depression past year (%)
6
11
11
15
22
7
Percent cigarette use past 30 days use (%)
23
49
44
66
68
19
Percent nicotine
dependence past year (%)
12
25
22
47
48
10
(Benham, 2017).
TABLE 7
Extra Costs of Missed Work by Industry
Per Capita Annual
Extra Cost of a with
an SUD, $
Agriculture
Per Capita Annual Extra Cost for a
Worker with a Pain Medication
Use Disorder, $
Per Capita Annual Costs
Avoided for Each Worker in
Recovery ($)
$187
$1,668
$90
�23
Substance Use Disorder, Job Performance, and Productivity
Mining
$881
$(764)
$422
Construction
$1,040
$455
$499
Manufacturing:
Durable goods
$1,399
$14,830
$671
Manufacturing
nondurable goods
$1,692
$1,677
$812
Transportation and
warehousing
$383
$3,125
$184
Information,
communications
$3,941
$27,173
$1,891
Wholesale durable
$(893)
$2,468
$(428)
Wholesale
nondurable
$886
$2,463
$425
Retail trade
$1,284
$225
$616
Finance, insurance,
real estate
$1,169
$2,373
$561
Professional, mgmt.,
admin
$2,604
$6,057
$1,250
Education, health,
social services
$887
$5,062
$425
Entertainment,
recreation, food
$795
$2,490
$381
Public administration
$1,406
$(162)
$674
Other services
$945
$2,417
$453
Open in a separate window
�24
Substance Use Disorder, Job Performance, and Productivity
Negative numbers are likely associated with small numbers of workers in some categories. Mining represents 0.6%
of the NSDUH employed respondents, so a small number of workers with an SUD in that sector with unusually high
or low absenteeism may skew responses. (Benham, 2017)
TABLE 8
Turnover Costs
Average
Sector
Turnover
rate (%)
Turnover
Rate for
Workers
with SUDs
(%)
Workers
in
Recovery
(%)
Per Capita
Turnover
Costa($)
Per Capita
Turnover
Cost if
Any SUD
Per Capita
Excess
Turnover
Cost if
SUD
Per Capita
Savings of
Worker in
Recovery
Agriculture
20
27
20
$1,535
$2,046
$512
$537
Mining
27
41
27
$5,044
$7,597
$2,553
$2,491
Construction
27
32
26
$4,440
$5,317
$877
$987
Manufacturing,
nondurable
19
32
19
$3,085
$5,052
$1,968
$2,074
Manufacturing,
durable
19
28
18
$2,601
$3,947
$1,347
$1,393
Transportation,
utilities
21
31
21
$2,871
$4,284
$1,413
$1,413
Information,
communications
24
43
23
$5,068
$9,137
$4,069
$4,140
Wholesale,
durable
21
34
21
$3,681
$5,924
$2,243
$2,301
Wholesale,
nondurable
20
26
21
$2,125
$2,682
$557
$488
Retail
26
39
26
$2,682
$4,075
$1,393
$1,393
Finance,
insurance real
estate
21
28
20
$3,974
$5,299
$1,325
$1,451
�25
Substance Use Disorder, Job Performance, and Productivity
Professional,
mgmt., admin
25
32
25
$4,506
$5,767
$1,262
$1,322
Education,
health, social
services
25
36
25
$3,762
$5,417
$1,655
$1,655
Entertainment,
recreation, food
36
49
36
$3,167
$4,271
$1,104
$1,133
Public
administration
18
25
18
$2,759
$3,711
$953
$953
Other services
except publ.
admin
26
44
27
$3,490
$5,862
$2,372
$2,282
Open in a separate window
verage turnover, recruitment, replacement, and training costs estimated at 21.4% of annual salary. (Benham,
a
2017)
TABLE 9
Per Capita Costs to Employers for Each Untreated Worker with an SUD
Prevalence of SUD (%) Excess Cost for Each Employee With an SUD ($)
Agriculture
8.6
$2,689
Mining
10.3
$8,934
Construction
15.0
$6,813
Manufacturing, nondurable
8.0
$6,907
Manufacturing, durable
8.4
$6,096
Transportation, utilities
7.5
$5,123
Information, communications
9.7
$13,534
�26
Substance Use Disorder, Job Performance, and Productivity
Wholesale, durable
7.4
$5,487
Wholesale, nondurable
10.6
$4,024
Retail
9.8
$5,815
Finance, insurance real estate
9.1
$6,925
Professional, mgmt., admin
10.3
$8,827
Education, health, social services
6.4
$6,760
Entertainment, recreation, food
15.3
$5,523
Public administration
5.7
$5,573
Other services except publ. admin 8.7
$7,264
Overall average
$6,643
9.4
(Benham, 2017)
TABLE 10
Employer Costs Avoided for Each Worker in Recovery
Industry Sector
Savings Per Worker in Recovery
Agriculture
$1,155
Mining
$3,890
Construction
$2,373
Manufacturing, nondurable
$3,823
Manufacturing, durable
$3,495
Transportation, utilities
$2,252
�27
Substance Use Disorder, Job Performance, and Productivity
Information, communications
$8,466
Wholesale, durable
$1,806
Wholesale, nondurable
$1,900
Retail
$3,134
Finance, insurance real estate
$2,950
Professional, mgmt., admin
$4,322
Education, health, social services
$2,998
Entertainment, recreation, food
$2,356
Public administration
$2,815
Other services except publ. admin $3,773
Overall average all occupations
(Benham, 2017)
$3,219
�28
Substance Use Disorder, Job Performance, and Productivity
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Adopting: Employee Assistance and Drug Testing Programs in Canada. Journal of Workplace
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of Applied Psychology, 77(3), 309–321. doi: 10.1037/0021-9010.77.3.309
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Volume 11: drug testing in the workplace (Vol. 11). New York: Plenum Publishing Co.
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Workplace Heroin Addiction Created and Led by Detroit Autoworkers. American Journal of Public
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�
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Gavrity, Amanda
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5/1/2020
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Does active addiction affect performance and productivity in the workplace?
Description
An account of the resource
This analysis of research is to determine if Substance Use Disorder negatively effects job performance and productivity. With today’s rising opioid epidemic, we take a look into SUD and what it means to have an SUD, we take a look into the effects of SUD and look into research that looks into poor job performance and productivity and does SUD have any relationship to this. Based on data and research collect little research states that there is no correlation between having an SUD and poor job performance and productivity. Further analysis shows that there is a correlation but there needs to be more current research due to the current status of SUD in the United States. Research also shows that there is a need for more in depth research for this topic due to the opioid epidemic and COVID-19 pandemic to further analyze the effects that these two events have had on the work force when it comes to mental health specifically SUD. This thesis will take a look into addiction, job performance, and productivity and what impact one has on the other.
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Business (Management and Marketing)
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Business
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Text
1
Tucker Cowdin
Senior Thesis
BU 400 Thesis and Practicum
Nicolais School of Business
Wagner College
Spring 2020
�2
Abstract
Veterans have always played a crucial role in protecting our country, but they have also
played a crucial role in business as well. In the entrepreneurship space of this country, veterans
make up around 10% of small business owners (Oja, 2020). Veterans are also comparably more
successful at becoming entrepreneurs than civilians are. There many factors that affect the
veteran’s success, but a major one is the military experiences such as boot camp and war which
instill teamwork, disciple, and resiliency in them. Veterans then take these skills and transition
into the civilian sector where they seek to become business owners. With many obstacles such as
adapting to a new work environment and having to learn a new set of skills to operate with
civilians, veterans have shown to be very adaptable and resourceful during this transition.
Veterans are shown to be older, more educated, and to earn more money than civilians are in the
small business sector. These results show support that veterans are more successful at being
entrepreneurs than civilians are and this information can be used for investors seeking to work
with veterans or even by veterans themselves who are seeking entrepreneurship.
�3
Introduction
Today, there is an immense and diverse workforce that operates businesses that address
almost every want and need of society. These companies are being started and operated by
highly motivated entrepreneurs who seek to make an impact on the world. However, a small and
less frequently discussed segment of these entrepreneurs share a bond that may give them an
advantage over others, namely military veterans. Military veterans have a higher chance of
becoming successful entrepreneurs because of the skills they learned while being in the armed
forces. The following is a discussion of how the skillsets are acquired and how veterans transfer
these skills into entrepreneurship.
Literature Review
Military Careers
Military Experiences
The topic of veteran entrepreneurs is not studied widely, but some research discusses their
characteristics. For example, research found that Veterans have more life experience and trauma
compared to civilians, but it does not seem to lower their perceived quality of life or ability to
work in a high-stress work environment (Heinz, Freeman, Harpaz-Rotem, Pietrzak, 2017). One
experience that Veterans endure include things like bootcamp, where they are molded into a
soldier and if they cannot handle it, then they are dismissed from the military. Another
experience is combat which teaches teamwork and strategy. All these experiences build mental
resiliency in soldiers which gives Veterans an edge. This resiliency is associated with higher
�4
levels of openness, optimism, purpose in life, professional development, and a great need for
autonomy (Heinz, Freeman, Harpaz-Rotem, Pietrzak, 2017). hese characteristics are crucial
T
when starting a company or operating a business which is why veterans are drawn to
self-employment.
Military Benefits
Research found that veterans are more than twice as likely to become entrepreneurs
compared to civilians and are more educated and older, as well (Heinz, Freeman, Harpaz-Rotem,
Pietrzak, 2017). The interpretation of this finding suggests that because the military requires a
minimum service of 4 years, veterans have more opportunity to seek higher education, through
military benefits such as the GI Bill, and to develop better life skills. Some of the life skills that
veterans develop in the military are the ability to function in a team, lead others in operations,
and to seek professional and personal development (Heinz, Freeman, Harpaz-Rotem, Pietrzak,
2017). Comparing those life skills to the traits of successful entrepreneurs shows how military
training can effectively prepare someone to be self-employed.
Length of military career
There is a curvilinear relationship between the length of service in the military beyond 4
years and the success rate of entrepreneurs (Heinz, Freeman, Harpaz-Rotem, Pietrzak, 2017),
which indicates that the skills that correlate to entrepreneurship are developed early on in one’s
military career. Veterans who serve for 4 to 20 years tended to become employees (Heinz,
Freeman, Harpaz-Rotem, Pietrzak, 2017), but veterans who served only 4 years or served more
than 20 years tended to have high entrepreneurship rates. Veterans who stay in 20 years receive
full benefits and have more financial freedom to pursue entrepreneurship opportunities.
�5
Length of military career cont.
Research shows that 45% of veterans attempt to be self-employed, and veterans who
spend less time in the military, 4 years, have a higher chance at becoming an entrepreneur when
compared to those who stay longer, 5-15 years (Hope, Mackin, 2011). However, this finding
does not apply to veterans who served 20 or more years in the military, who appear to have the
same rate of entrepreneurs as do their younger counterparts. The reason for this is because those
who stay longer than 20 years usually have higher pensions and have acquired hire education to
advance their military careers. With this extra wealth and education, veterans with 20 or more
years of service have around a 45% rate of seeking self-employment Hope, Mackin (2011).
Special Forces
Veterans are highly sought after because they are resilient, highly trained, and have
significant experience working in stressful situations because of the training they receive.
Military training is intense, but that intensity is amplified for individuals who enter the Special
Forces. These individuals must endure grueling selection processes that lead them to have
stronger traits such as mental resiliency, work ethic, and leadership beyond the average veteran
(Smith, Young, Crum, 2020). Instructors of special forces selection programs train the candidates
to think positively during stressful times rather than thinking negatively. Instructors taught the
candidates about task orientation, visualization, and positive thinking (Smith, Young, Crum,
2020). When the candidates applied these lessons to the training, their success rate increased
from 20% up to 90%, while the candidates who did not apply these lessons saw no change in
success rates (Smith, Young, Crum, 2020). reating this mindset that focuses on task orientation,
C
visualization and positive thinking in soldiers allows the military to send them to perform
�6
high-risk operations and to mitigate stress, which is why these mindset training techniques are
sought-after in the civilian world because of their endless application to life and work.
5 tools used by special forces
Research found that these special forces soldiers can individually and collectively make
mindful decisions in high-stress operations (Fraher, Branicki, Grint, 2017). This ability is
referred to as “Mindfulness in Action” and consists of five important tools that are used to
handle and succeed at operating in high-stress situations, as follows: preoccupation with failure;
reluctance to simplify; sensitivity to operations; commitment to resilience; and deference to
expertise (Fraher, Branicki, Grint, 2017). Preoccupation with Failure means that small failures
must be noticed and addressed. Reluctance to Simplify means to maintain distinctiveness.
Sensitivity to Operations is to analyze everything that can lead to failure. Commitment to
Resilience is having the ability to bounce back. Deference to Expertise is empowering
individuals on your team to develop their own pathways (Fraher, Branicki, Grint, 2017). These
mindfulness skills are developed through the military training and experiences which makes the
skills hard to obtain for civilians yet highly valuable to teams and companies that do not have it.
Veterans Skills and Entrepreneurship
Skill sets veterans take away from the military
Through their training and experiences, veterans leave the military with a skill set that is
difficult to obtain in the civilian world. Because of these skillsets, veterans seek self-employment
�7
and they are so successful at it that almost ten percent of businesses are owned by a veteran (Oja,
2020). Research indicates veterans have strong intrapreneurship skills that they derive from the
military such as the following: risk management; performance under pressure; directness; speed;
assertiveness; team decision-making; methodical approaches to problems; and leadership
qualities (Oja, 2020). The research also shows that individuals who already have these skill sets
seek the military more than people who do not have these skills (Oja, 2020), which suggest that
the military is recruiting individuals who already have an entrepreneurship mindset and use this
mindset and skills gained from the military to seek out entrepreneurship opportunities.
Obstacles veterans face in the civilian workforce
With the success rate of veteran entrepreneurs being high, it does not mean that the transition
from soldier to civilian is easy and without obstacles. The biggest obstacle that transitioning
veterans face is developing civilian skills and applying their military skills to best use (Lyons,
2014), which is an obstacle faced by over 30% of Veterans who described it as being the most
difficult obstacle to overcome. In contrast, 70% stated that they did not experience any problems
with learning civilian skills and that their work environment showed a more military style of
operations (Lyons, 2014).
The next biggest obstacles veterans faced was having to work with a team that had different
work ethic, level of trust, and discipline that they were used to having in the military. Around
60% of veterans discussed how emotional trauma was a challenge to get over and they had
anxiety and doubt about leaving the military and the unknown of the civilian workforce (Lyons,
2014). To cope with these obstacles, the participants stated that staying positive, maintaining
�8
physical fitness, networking with other veterans, and using their training of task orientation and
mission planning helped them overcome these obstacles (Lyons, 2014).
Veterans’ ability to adapt
The transition from the military to the civilian world can be difficult, however, many
veterans found that immersing themselves back into training, in this case for the civilian world,
allowed them to become more successful (Kerrick, Cumberland, Church, Kemelgor, 2014).
Research showed that veterans who participated in a 10-week entrepreneurship course (learning
market strategy, inventory, client relations, etc.) and who worked with local entrepreneurs were
twice as likely to pursue entrepreneurship opportunities and were more prepared to handle the
challenges that the course provides (Kerrick, Cumberland, Church, Kemelgor, 2014).
Stats on veteran-owned businesses
Veterans are able to train and adapt to their environments better than most civilians are able
to adapt, and because of this, the number of veteran-owned businesses have grown, and the
businesses can be studied more in-depth now (Sobota, 2012). The largest percentages of veteranowned business were financial, construction, and professional or technical. Most of these
businesses were small, usually having 10 to 19 employees. The states with the highest number of
veteran owned businesses are California and Texas, which are the states with the largest
active-duty military population (Sobota, 2012). The largest form of investment capital that these
veterans had in their businesses were from their personal accounts or family savings (61.7%)
(Sobota, 2012).
United Nations sustainable goals
�9
Veteran-owned business are 5 times more likely to hire a veteran employee than are other
businesses (Sobota, 2012), which is good for veterans, and it also helps address one of the United
Nations Sustainable Goal #10: Reduced Inequalities because it helps fight the rising level of
veteran unemployment. The military is amongst one of the most diverse organizations in the
world (Sobota, 2012), so offering veterans employment helps decrease inequality. Research also
shows that veteran entrepreneurs higher wages and offer more benefits to their employees, which
provides people with healthcare and helps them stay out of poverty (Sobota, 2012).
Conclusion
Veterans are trained to be hardworking and disciplined individuals who work effectively in
teams, and there are few other correlating aspects of our society than business and sports
franchises that benefit the most from having these characteristics. The veteran entrepreneurship
population is growing and the reason for its success is the life lessons and skills that the military
provides. Top-level military operators such as special forces soldiers are highly sought-after
employees because of their ability to make mindful decisions in high-stress situations. Veterans
not only thrive in the business world, but they are more competitive and adaptive than most
civilians, which is why veterans have a higher chance of being successful entrepreneurs than
civilians.
Hypotheses
H1:
Veterans are more drawn to become entrepreneurs compared to non-veterans of the same
age, education, household, race, and sex.
H2:
�10
Veteran entrepreneurs have a higher likelihood of becoming a successful entrepreneur
compared to non-veterans based on skills and abilities acquired from the military.
Method
Subjects
Veterans & Non-veterans
The U.S. Census Bureau’s Survey of Business Owners (SBO) conducts a survey once every five
years on Small business owners. Participants were able to distinguish themselves as being either
a veteran or a non-veteran prior to taking the survey.
Measures
Sample
The SBO conducted over 1.78 million surveys and took a population sample of 239,178,768
individuals in the year 2012. Of this sample, there were 21,230,865 veterans and 217,947,903
non-veterans.
Procedure
The research used was found using the Wagner College database, OneSearch. I was able to
locate this research study after using search terms “Veterans” and “Entrepreneur.” This study
was ideal because it was one of the very few that compared veterans to non-veterans. Analyzing
the data, it calculates the percentage of each survey question for each individual group (veteran,
non-veteran). This allows us to see side-by-side how each group correlates.
Survey
Period of service
Gender
Age
Race and Ethnicity
�11
Median Income
Educational Attainment
Results
Survey
Period of service
Table 1 shows that 75% of veteran small business owners were wartime veterans and 25%
were non-wartime veterans. The largest percentage of veteran business owners served during the
Vietnam era war at (34.9%), while 12.9% served during the current war era (i.e., Gulf War II
era), s and 17.1% served during the war prior, (i.e., Gulf War I)
Gender
Of veterans, there is a large discrepancy between men and women becoming small business
owners. With 92.4% being men and only 7.6 being women, while on the civilian side, women
lead the way at 55.8% and the men at 44.2%. Business owners in the civilian realm are more
gender diverse. while the veteran realm is mostly male- dominated.
�12
Age
Age was divided into different segments: 18-34; 35-54; 55-64; 65-74; and 74 and over. For
veterans, there are fewer business owners in the 18-34 years age segment (8.6%) but for the older
age segments, the percentage is in the 20% range. For civilians, side shows the age segments
with the highest percentage of entrepreneurs is the youngest segments of 18-34 years (32.6%)
and 35-54 years (36.4%). Other age groups have percentages as low as (6.6%). The results show
that veterans not only start creating business when they are older but tend to remain business
owners longer in their life when compared to civilians.
Race and Ethnicity
The results where almost identical between civilians and veterans. White was the largest race
for both sides coming in at 83.7% for the veterans and 74.9% for the civilians. The next largest
�13
was African Americans coming in at 11.3% for veterans and 12.2% for civilians. The only major
difference between the two was the Hispanic or Latino segment where the veteran side only had
5.7% and the civilian side had 15.6%. As far as diversity goes, both sides are on par with each
other with the biggest differences being that of Asians and Hispanic/Latinos, where the civilian
sector has better representation of them.
Median Income
Table 1 shows median income for civilian and veteran workers above the age of 18 in 2012
dollars. Veterans on average, and between the sexes, have a higher median income compared to
civilians. The average median income for veterans is $36,264 while the average for civilians is
$25,337. The total for veteran males is $36,672 and females is $30,929 while civilian males was
$31,586 and females $21,071. This not only shows that veterans make more, but it also shows a
smaller pay gap between the sexes for veterans than civilians.
�14
Educational Attainment
This category is broken into 4 segments of education: less than high school graduate; high
school graduate or equivalent; some college or associate degree; and a bachelor’s degree or
higher. The results show veterans having a smaller percentage of individuals who have not
graduated high school (7.1%) than the civilian business owners (14.4%). Veterans have a higher
percentages of business owners with a high school diploma (29.2%) and some college or
associate degree (36.9%) than civilians. Civilians have lower percentages: high school graduates
at (27.9%); and some college or associate degree at (28.3%). The only segments where civilians
exceeded veterans in educational attainment is the bachelor’s degree or higher with results at
(29.3%) while the veterans are at (26.7%).
�15
Discussion
Veterans and civilians clearly have different life experiences and these differences show up
in entrepreneurship. In terms or age, both veterans and civilians believe it plays a significant
factor is self-employment, however, there is more youth on the civilian side when compared to
the veteran side. This can be interpreted that the veterans where enlisted in the military during
their younger years, so they were not able to pursue entrepreneurship opportunities at an earlier
age. With education, overall, veterans are more educated than civilians are. This can be
correlated to the fact the veterans have benefits like the G.I. Bill which helps them pay for higher
education while the civilians must rely on student loans. Median income shows that veterans
earn more money than civilian earn as small business owners, however, because veterans get
benefits such as more attractive business loans and retirement pay, it can be inferred that these
military benefits will lead them to have higher income. Diversity between both groups show
opposite results in terms of sex. Veteran males are more likely to be entrepreneurs than females
while it is the opposite for civilians. This shows that there are more opportunities in the civilian
sector for female entrepreneurship than there is in the veteran sector where most
�16
entrepreneurship is found in business sectors that are male dominated; construction, plumbing,
finance. The research showed that the being in the military longer results in less
self-employment, most likely due to the financial security that the military provides during
someone’s middle-aged years.
Conclusions
This thesis gives a vivid description of both veteran and civilian business owners, showing
their similarities and their differences. Veteran business owners are far more male dominated
while civilians are mostly female dominated. There is more youth in the civilian sector while the
veterans have older business owners who tend to stay business owners for longer. Race and
ethnicity were almost even between civilians and veterans showing there is not much limitation
for anyone wanting to become a business owner. Last, we see that veterans earn more than
civilians and are generally more educated, besides a bachelor’s degree, than civilians. Hypothesis
1, veterans are more drawn to entrepreneurship than civilians …, is found to be true through this
research and the fact that there are 30 million small business owners in the country and 2.5
million of them are veteran owned. Given that there are 18 million veterans in the country this
gives us 14% of veterans become entrepreneurs while the civilian sector, 330 million population,
has only 8% becoming small business owners. The second hypothesis, that veteran is more likely
to be more successful based off military training is partially true. There was no evidence that
showed military training had a direct impact on success, but the research did show that veterans
made more money and were entrepreneurs longer than civilians. Hypothesis 3 And 4 were
unfounded as there was not enough information on veteran and civilian stress management and
entrepreneurial skills. However, the research did give us some interesting insight into how elite
�17
teams like the Navy SEALS handle stressful missions and the tools they use can be applied into
our lives as well.
Implications for practice
The research allows us gives us multiples avenues for applications, such as pitching a veteran
start-up to investors. The start-up can use the data found in the research to show how on average
veterans are more educated and make overall more money than civilian entrepreneurs. This
research can also be shown to military men and women who are transitioning out of the military
and are seeking entrepreneurship. This research will help them understand that veterans are
successful in entrepreneurship and because of all the benefits that the military offers; low-interest
rate small business loans, G.I. Bill for education, free healthcare.
Implications for research
Research on veteran entrepreneurship is scarce given the size and success of these business
owners. The study should help inform future studies on how veterans compare to their civilian
counterparts especially when it comes to income and educations. There is a stigma that veterans
are not as educated and make less money than civilians, but this study proves the opposite. For
future research, there needs to be more evidence comparing and contrasting veterans and
civilians. The research I found contrasting the two was limited as the overwhelming research was
just speaking regarding the veterans. There also needs to be research done on how the veterans
can utilize all the benefits that the military offers them. Especially on the different loans they are
offered to create small businesses and if they can extend their healthcare benefits to employees.
Overall, there needs to be more research done on veteran entrepreneurs and I hope this paper
sheds some light and offers understanding on these valuable business owners.
�18
References
FRAHER, A. L., BRANICKI, L. J., & GRINT, K. (2017). Mindfulness in Action: Discovering
How U.S. Navy Seals Build Capacity for Mindfulness in High-Reliability Organizations
�19
(Hros). cademy of Management Discoveries, (3), 239–261.
A
3
https://ezproxy.wagner.edu:2310/10.5465/amd.2014.0146
Fraher, Branicki, Grint (2017) This article investigates how U.S. Navy SEALS can individually
and collectively make mindful decisions in high-stress operations. These article calls such ability
“Mindfulness in Action” and research SEAL commandos to try and figure they can obtain it.
While finding out new concepts to combine these skills from an individual and cooperative level,
this article seeks to open up new avenues for reliability-seeking organizations.
Heinz, A. J., Freeman, M. A., Harpaz-Rotem, I., & Pietrzak, R. H. (2017). American military
veteran entrepreneurs: A comprehensive profile of demographic, service history, and
psychosocial characteristics. ilitary Psychology (American Psychological
M
Association), 9(6), 513–523. ttps://ezproxy.wagner.edu:2310/10.1037/mil0000195
2
h
Heinz, Freeman, Harpaz-Rotem, Pietrzak (2017) This article investigates the impact that military
services has on self-employed veterans and also veterans who works as employees. Veterans are
more than twice as likely to become entrepreneurs when compared to non-veterans. From this
study it also shows that veteran entrepreneurs are more educated and older than the civilian
entrepreneur. This article also shows no correlation to experiences in the military to success in
the workforce. When compared to veteran business owners versus veteran employees the biggest
�20
differences were that the business owners tended to have served in Vietnam and were not in the
military if veteran employees.
Hope, J. B., & Mackin, P. C. (2011). actors affecting entrepreneurship among veterans. New
F
York: SAG Corporation.
Hope, Mackin (2011) This books studies whether or not military training has any correlating
effects on self-employed individuals in the workforce. The book did find that they can link
around 45% of former military members attempt to be self-employed. However, the book does
show that veterans who spend less time in the military seem to have a higher chance at becoming
an entrepreneur when compared to those who stay longer. This finding suggests that maybe
military training itself doesn’t have an effect on entrepreneurship. However, this finding does not
apply to veterans who served 20 or more years in the military, they appear to have the same rate
on entrepreneurs as do their younger counterparts.
Kerrick, S. A., Cumberland, D., Church-Nally, M., & Kemelgor, B. (2014). Military veterans
marching towards entrepreneurship: An exploratory mixed methods study. nternational
I
Journal of Management Education (Elsevier Science), 2(3), 469–478.
1
https://ezproxy.wagner.edu:2310/10.1016/j.ijme.2014.05.006
�21
Kerrick, Cumberland, Church, Kemelgor (2014)This study was aimed at how community-based
entrepreneurship and networking training had on military veterans. The study was measuring
Entrepreneurship Passion (EP) and networking behavior. The study was a 10-week course and
included business mentoring sessions with local entrepreneurs. The study showed positive results
in veteran EP and increased in networking behaviors.
Lyons, J. A. (2014). eteran entrepreneurship: A phenomenological study of the lived
V
experience of veterans' transition from military service to entrepreneurship (Doctoral
dissertation, Capella University).
Lyons (2014) This study was aimed at understanding how the Gulf-War Era II veterans became
successful entrepreneurs even though they faced many challenges. Gulf-War Era II veterans refer
to veterans who served in the Post 9/11 era. Some of these challenges were a significant number
of people not joining the military during this time and the decline of the self-employed veteran.
Some of the questions that this study asked was how these veterans perceived opportunity, how
they transitioned their life-experiences into entrepreneurship, and what did the military provide
that aided them to becoming a successful entrepreneur.
�22
Oja, S. (2020). all for Chapters: Global Perspectives on Military Entrepreneurship and
C
Innovation. IGI Global.
Oja (2020) This book first starts off by explaining how the field of military entrepreneurship has
very little research on it but that it plans on changing that. This book describes how veterans
have strong intrapreneurship that derive from the military. This book also touches on how
important the role of the military spouse entrepreneurship is and why itself is a topic that needs
more research. The book also lists qualities that veterans gain from the military such as: risk
management, performance under pressure, directness, speed, assertiveness, team
decision-making, methodical approaches to problems, and leadership qualities.
Smith, E. N., Young, M. D., & Crum, A. J. (2020). Stress, Mindsets, and Success in Navy
SEALs Special Warfare Training. rontiers in Psychology, 0, 1.
F
1
Smith, Young, Crum (2020) This study was conducted to understand what allows individuals to
go through stressful situations and how if their mindsets can be a predetermination on how those
individuals perform. The test was on the notorious screening test ran by the U.S. Navy SEALS
which is called BUDs (Basic Underwater Demolition training). The study test individuals who
have a stress-is-positive mindset or a stress-is-debilitating mindset. The study followed 174 Navy
Seal candidates through the grueling 6-month screening process.
�23
Sobota, J. (2012). Veteran-Owned Businesses and Their Owners: Data from the US Census
Bureau’s Survey of Business Owners. ublic Law, 06, 50.
P
1
Sobota (2012) This research was done by the U.S. small business administration and aimed to
explore the rarely researched field of veteran entrepreneurship. This research was to see how the
Veterans Entrepreneurship and Small Business Development Act of 1999 effected veterans
retiring from duty. The information was taken from the 2012 census and provided in-depth
information about veteran ran companies. Such information consisted of average company size,
average industry that veterans operate in, and the demographics of veteran entrepreneurs.
�
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Effect of Veteran Status on the Propensity to become an Entrepreneur
Description
An account of the resource
Veterans have always played a crucial role in protecting our country, but they have also played a crucial role in business as well. In the entrepreneurship space of this country, veterans make up around 10% of small business owners (Oja, 2020). Veterans are also comparably more successful at becoming entrepreneurs than civilians are. There many factors that affect the veteran’s success, but a major one is the military experiences such as boot camp and war which instill teamwork, disciple, and resiliency in them. Veterans then take these skills and transition into the civilian sector where they seek to become business owners. With many obstacles such as adapting to a new work environment and having to learn a new set of skills to operate with civilians, veterans have shown to be very adaptable and resourceful during this transition. Veterans are shown to be older, more educated, and to earn more money than civilians are in the small business sector. These results show support that veterans are more successful at being entrepreneurs than civilians are and this information can be used for investors seeking to work with veterans or even by veterans themselves who are seeking entrepreneurship.
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Business (Finance)
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23 pages
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Business
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Text
INVESTING IN GREECE
GOOD OR BAD IDEA?
KONSTANTINOS SYRMAS
MAY 12, 2021
PROFESSOR CARTER
BU 400 SENIOR THESIS AND PRACTICUM
�Abstract
This research paper will be discussing topics about the Greek economy and it’s
improvement over the years from the 2007-2008 financial crisis into today in 2021. I will be
writing about the importance of FDI (Foreign Direct Investments) to the Greek economy,
analyzing GDP, inflation rates in the country over the years as well as unemployment rates as
well as imports and exports in the country. The purpose of this essay is to prove the points I
will be making in my three hypotheses and also come to the conclusion of if it is worth it or
not investing in the Greek economy. I will present analytical data and history of Greece’s
economy after the 2007-2008 crisis until now and also look to see if the Greek economy has
improved itself after that period of time and if it’s ready to handle more investments coming
into the country.
Introduction
In my research paper I will be analyzing different sections of the Greek economy after
the 2007 crisis up to current day 2021. In this paper I will get my audience to understand
why after all, it would be a good idea to invest or not in Greece. I will analyze the 2007-2008
Greek economic crisis and other previous similar economic crisis that have happened around
the world in the past. I will include charts and data tables that will show to my audience the
progress of the Greek economy during the years mentioned before by analyzing information
on Gross Domestic Product, inflation rates, unemployment rates, imports and exports in
Greece from 2007 to 2021 predictions. I will be writing about different sections of the Greek
economy with the biggest investments over the years, such as the shipping industry and the
tourism industry, from which the Greek economy has been strongly supported. I will be
talking about the importance of FDI (Foreign Direct Investments) in Greece over the years,
and also the impact of the Greek financial debt to the Greek economy. In this paper I will be
also supporting my 3 hypothesis and talk about how Greece is steadily making its economy
1
�stronger and better for new and current investors. The main purpose of my paper is to make
my audience understand how Greece would be a great country for future investments and I
will achieve that by presenting data and information on the economic growth of the Greek
economy over the years. Trustworthy investment sections of the Greek economy show them
how Greece is steadily coming out of financial debts and boosting up their economy and
financial system. This research has a high importance to me because as I am a Greek citizen
and would like to depict and analyze if the Greek economy is doing better after the 2007
financial crisis hit and if it would be a good idea for me as a graduate international student to
work and invest in my country in the future or to stay in the United States and find a work
position here.
Literature review
Economic crisis in Greece 2007
Related economic crisis in other countries prior to 2007
USA, Latin America, East Asia, UK
An economic crisis started in Thailand in 1997 after an astonishing three decades of
growth in East Asian countries. Income had risen; poverty had decreased; and health status
had improved. Many of the East Asian countries’ economies had outperformed the economy
of the United States given that some of the East Asian countries had not experienced a
recession year for over 30 years (Meier & Stiglitz, 2016). Due to international pressures,
including pressure from the United States’ Treasury Department, East Asian countries
liberated their capital and financial markets by the 1990s.This financial market liberation
triggered a short-term capital flooding by various countries over the long-term investments.
In the 1980’s, a financial crisis occurred in Latin America when many people lost
their monetary policies, leading to continuous inflation (Meier & Stiglitz, 2016). The
International Monetary Fund intervened to help provide aid and required strict financial
guidelines (i.e., requiring balanced budgets). The 1929 stock market crash in the United
States led to the Great Depression, which was the most severe economic crisis (Haralambie).
2
�It was initiated in the U.S.A then preceded for nine years of economic development promoted
money supply in circulation by the Central Bank of America Federal Reserve (Haralambie,
2016). Following the creation of financial and monetary guidelines for stocks, many people
invested in the stock market, something that led to a steady stock increase in the stock
markets till September 1992, when there was an significant market crash (Goldberg, 2012).
The United States then restricted the imports through various protectionist policies, leading to
the intensification of the economic crisis in Europe.
The Credit Crisis of 1772 originated from London then expanded to other parts of
Europe. In the 1760s, the British empire had acquired much wealth through its trade and
colonial ruling over the countries they colonized. This led to an atmosphere of over-optimism
and a rapid credit expansion duration by several British banks (Sheridan, 2015). It came to an
unexpected end in June 1772 when Alexander, a member of the British Banking house, fled
to France to escape the debt payments. The news then spread everywhere, triggering British
Bank partners' instant withdrawal demands, for they felt their savings were no longer safe in
the bank as per the Alexander experience. This leads to an economic crisis because the
massive withdrawals from the British banks affected the economic growth of the country by
providing insufficient investments and bank savings to develop economically.
The financial crisis of 2007-2008 triggered the great recession, which caused
economic and financial turmoil globally (Cecchetti, 2018). The financial crisis was due to the
collapse of the mortgage-financing market and the collapse of Lehman Brothers', which was
one of the primary investment banks in the world; this breakdown then also led to the
collapse of various financial and business institutions (Cecchetti, 2018). It took almost a
decade for the government to bring the economic activities back to normalcy, doing away
with several job opportunities and billions of dollars, hence promoting the economic crisis.
3
�The above economic crises affected the Greek economic crisis. Several adverse
aspects in business and financial institutions trigger the economic turmoil in many countries
worldwide. Almost all states countrywide are experiencing an economic crisis. Still, the
difference comes with the level whereby countries like Greece are positively impacted, unlike
the United States, which is less affected by the economic crisis. The Greek economic crisis
began in 2007 as part of the world economic crisis (Visvizi 2012). The Greek economic
crisis worried the European Economic Community because it seemed like the Greek crisis
could impact the value and volatility of the euro. Due to Greece’s exposure to marginal assets
at that period, Greece seemed to have a positive growth in the years 2007 and 2008 and also
seemed unaffected from the rest of the world. In May 2010, Greece requested financial
assistance (110 billion euros) from the International Monetary Fund and the European Union.
Greece requested additional assistance in 2011 (Visvizi, 2012). Greece’s need for economic
assistance packages worried the European Economic Community which realized that Greece
was unable to support itself.
Greek economy after the 2007 crisis
Greek financial debt, debt crisis
To Greece, the debt crisis in 2007-08 is a problem that paralyzed its economy
for a long time. One of the eminent effects of the crisis is unemployment. FDI is among the
pertinent factors that helped the country address the situation. Therefore, an evaluation of
how the foreign investments helped the country address the various adverse effects of the
debt crisis is critical.
Greece joined the European Union (EU) in 1981 to protect democracy in the country.
The country had suffered a great deal of political instability, and the EU felt responsible for
improving the country’s democracy and the rule of law. However, this move was made
without considering the economic ramifications of adding such an unstable country to an
economic block made up of well-developed countries recount that this failure to observe a
4
�vital aspect of an economic partnership was repeated in 1981, 1999, and 2001, when Greece
became a full member of the EU (Ioannides and Pissarides 2015).
It was clear that the country was not in any position to compete in the new market
block. The fall in demand for local goods led to a sharp decline in employment, as Ioannides
and Pissarides (2015) indicate. There was a rise in the number of unemployed people and,
therefore, contributed negatively to the national economy.
To address the problem, the EU supported the country to have more time to repay the
loans to sustain its economic operations. The debt kept increasing between 2008 and 2018.
However, in 2010, Greece learned of the negative ramification of joining the EU (Belkin &
Jackson, 2015). The country wanted a way out, but it would be harsh to the people in the
country. However, this alert by the government was answered by even more debt to the
country. It is important to note that these loans come from various European authorities and
private investors worldwide.
It is also important to note that in 2009, the country indicated a budget deficit of
12.9%. This is more than the average 3% in many European countries (Oldani & Savona,
2010). This rate raised the alarm among many potential debtors, and the country’s credit
rating was greatly affected. This report’s negative result is that it raised the interest rate of
any future loans granted to the country.
This situation was later confirmed when the country indicated that it might default on
the loans it was sufficing at the time. The situation was quickly graduating from bad to worse.
The debt situation was becoming an overwhelming burden to the country, and the
government came to the point of uncertainty (Mah et al. 2014). The debt had grown from
112.9% in 2008 to 179.6% by 2013 (Mah et al., 2014).
Impact of the Debt Crisis on the Country
5
�The first impact of the debt is the considerable interest that amounts after years of
serving the loans. The government often took more loans to service the interest of the old
loan. As Michelis (2011) indicates, this is only a short-term solution since the new loan will
have to be paid. This cycle would mean that the country would remain in a loan crisis. This
situation was a problem to the land that ideally needed to reduce its loan progressively.
Another problem that Greece grappled with is imposed austerity measures. These
measures have come to harm the country on several fronts. The first problem is that many
families felt the impact of reduced spending in the form of reduced pension. The country
experienced a 22% less GDP due to restrained government spending (Mantalos, 2015). Many
families in Greece rely on pension plans, and they account for a considerable fraction of
government spending. Therefore, these families were left with little to nothing to rely on for
their economic welfare.
There was less money in circulation since many projects undertaken by the
government were brought to a halt. The reduced expenditure led to reduced cash in
circulation of the economy. Unemployment rate increased by 21% due to the shrunk
economic activities, more people ended up jobless since government projects were stopped
(Mantalos 2015).
The country’s debt crisis has seen the country face trying political times. The
government has cut the pension available to many families and increased the taxes levied on
essential goods. This move has angered many people who feel that the government should be
excused from paying some of the debt by the EU lenders. Michelis (2011) points out that debt
haircuts can effectively save Greece from the current debt burden. The crisis has been used as
an essential pointer to the discussions among leaders.
FDI in Greece
The importance of it to the Greek economy and economic growth.
6
�Foreign Direct Investment (FDI) is an essential driver of the economic development
of any country. In collaboration with other economic factors, FDI helps nations develop and
improve the welfare of their citizens. Additionally, FDI helps nations overcome some of the
vital challenges it may face as it attempts to overcome an economic crisis that recently hit
them. The global financial crisis in 2007-08 is an example of a crisis that economically
affected many nations (Ozturk & Sozdemir, 2015).
Foreign Direct Investment (FDI) was a promising alternative IMF and EU bailouts for
Greece, whose spending rate was significantly reduced. There were positive results from FDI,
however, there are some concerns associated with FDI.
Positive Impact of FDI
Greece can benefit from FDI because foreign investors can alleviate government
budget shortfalls. Greece can benefit from the foreign resources injected into the economy as
the country struggles to regain economic stability, and more people will be saved from
poverty. FDI adds to the tax revenue. However, Greece must be careful not to overwhelm
investors with too high taxes, (Baltas, Tsionas & Baltas, 2018).
Greek residents benefit from FDI through employment. Greece is suffering from the
austerity measures, so there are fewer government projects in progress, which led to a
significant reduction in employment. Specifically, for every 3% decrease in investment, a 1%
increase in unemployment is reported. The austerity measures caused high unemployment.
Therefore, FDI will provide new job opportunities and reduce unemployment (Karfakis,
Katrakilidis, and Tsanana 2014).
Sales of locally produced goods will also help Greece achieve a balance between the
exports and imports (Pegkas & Tsamadias, 2016). Foreign investors will sell their products
Greece, and foreign (i.e., non-EU)high technology goods are better positioned to compete
with Europe’s goods. Therefore, the government can have some locally produced goods that
7
�meet the regional market quality and prices. This benefit will have a long-term value to the
country, primarily as it seeks to realize economic stability to match the developed countries
in the region.
Another vital benefit of FDI for Greece is the advanced technological skills and
workforce that foreign investors bring. Usually, local people learn more skills and techniques
from foreigners (Pegkas & Tsamadias, 2016). Technology and the new skills bring vital
benefits to the country, including improved work efficiency and better-quality products.
These benefits are crucial benefits to the country, as it attempts to match fellow European
countries’ standards.
Major Concerns Associated with FDI
One disadvantage of FDI is that it may exploit the local resources and market. Most
private investors in foreign countries seek means of tapping the unexploited resources and
demand. This situation means that foreigners benefit from the local resources more than the
local people and the local government, which could eventually worsen the country’s
economic situation.. (Monastiriotis, 2011).
Occasionally, local businesses are jeopardized by the operation of foreign investors
because local entities often have fewer resources, and lower quality products. As a result,
foreign investors can negatively affect the local firms trying to grow and improve their
quality of products. Therefore, the foreign entities can jeopardize the local firms’ future
(Eimers, Nouwens, and Toorman, 2005). The government must intervene and find innovative
methods to protect the local firms while attracting foreign investors.
Occasionally, foreigners do reinvest profit into the local economy. However, if
foreigners have a parent company in another country, their operations within Greece would
be limited to only exploiting the available commercial opportunities, and profit goes back to
their parent company. Greece could experience the same problem if companies are not
8
�interested in having extensive operations within Greece and instead take their earnings back
to the developed countries (Vlachos & Bitzenis 2018). Greece stands to lose much more
resources and revenue if the foreign investors take all the country’s profit.
Investments made over the years in different sections of the economy
For anyone who likes risky investments, Greece is the most convenient place for
investing. The most convenient way to invest in Greece is through The Exchange Traded
Fund (ETF) such as GREK1. In this chapter, we will focus on some of the significant
investments that have been in Greece to prove that it is fit for investing.
Tourism
Greece is one of the most renowned major tourist attractions and destinations in
Europe since the 1960s. From the research results, it should be clear that Greece's tourism
industry is one of the sectors that has positively contributed to the country's economic
growth. Although, Greek tourism as well as the shipping sector of the economy got huge
losses in the greek crisis years after 2007 but found its way to get back to the top contributor
of the economy (Visvizi, 2012) . This fact has influenced large masses of people to invest in
this sector. For instance, the effects of tourism on Greece's gross domestic product are
estimated to be 20.6 percent (Buhalis & Deimezi, 2016). It is a clear indication that one out of
five euros spent in Greece came from the tourism and travel industry. It is making it one of
the most invested industries in the nation.
As a result, this sector has promoted the economy of Greece. If the country laid even
more emphasis on its Tourism sector, it would be sure to experience more development and
increase its economic growth rate. Some other benefits of the tourism industry in Greece are
that it has provided a good number of employment opportunities to both the citizens of
Greece and those of foreign countries. Therefore, this provides citizens with an additional
1
“GREK tracks a market-cap-weighted index of about 15 Greek firms” (GREK ETF Report)
9
�source of income, especially during the summer months, adding to the well-being of Greek
households. However, some challenges are known to hinder tourism by lowering the number
of tourists in the country. Among these challenges is climate. Climate plays a big role in the
Greek tourism because tourists always want a nice place with nice weather to go to for their
vacation, especially in the summer. If the climate is not perfect for vacation (if there is rain
and cold), this could be a big issue for the tourists and they would rethink their decision of
going to Greece for their vacation, but this is something that the climate in Greece has never
let happen in the summer months . Therefore, it is right to say that the tourism industry is one
of Greece's sectors that has historically performed exceptionally well and, hence, is always a
positive weight in the efforts of raising the GDP of Greece (Buhalis & Deimezi, 2016). Also,
it would be even more effective if more people opted to invest in the field.
Shipping
Shipping has always been one of Greece's most important sectors of the economy and
possibly the most profitable one. Greece is a nautical country and shipping is considered to be
its oldest form of occupation. The shipping sector of the Greek economy took a big hit after
the 2007 crisis (Visvizi, 2012). Therefore, the results obtained from the research should
indicate that shipping is Greece's most fundamental industry. In 2018, the shipping industry
in Greece was worth $ 21.9 billion (Kapros & Panou, 2017). As a result, many people have
opted to venture into the shipping industry, making it one of Greece's most invested fields.
The Greek shipping industry is strongly internalized, and it holds 18% of the world
market in that sector, which is very high for a small country like Greece (GIG, 2020). The
shipping industry has therefore provided many job opportunities to many people enabling
them to earn their income, and as a result, they are better able to rely on themselves.
However, some challenges are known to affect the effectiveness of the shipping industry's
performance. Some of these challenges include security risks - shipping services are prone to
10
�insecurities such as pirating whereby certain terrorist groups may kidnap them - and weather
since many times the ships and their crew have to endure very bad weather conditions.
UN related topic selection
During my research at the United Nations website, I found some very interesting facts
about unemployment globally under their subject 8 “Decent work and economic growth”.
IMF predicts a worse global recession than the one in 2009 due to Covid 19 and that the
damage in the economy will be huge in the years 2020 to 2021 globally (UN, 2020).
Unemployment rate hit 5.6 percent in 2017 globally which was better than the unemployment
rate of 6.4 percent in 2000 (UN, 2020). On Greece’s side, unemployment rate was much
higher in the rate of 9.6 percent in 2009 and reached its peak in 2013 with 27.5 percent but it
seems to be declining in the prediction rates of 2020 and 2021, 16.4 and 16.6 percent, but
again this prediction rates might change at the end when they come out because of the Covid
19 global pandemic, financial and economic damage (IMF, 2021). UN set target goals for the
next years as well as Greece did and every other country in the world for the upcoming years.
Their goals is to achieve full and more productive employment for both men and women by
2030, but not limited to economic productivity increasement and higher GDP (UN, 2020).
Hypotheses
H1: The 2007-2009 recession caused Greece's debt to increase.
H2(a): The 2007-2009 recession caused Greece's unemployment rate to increase.
H2(b): The 2007-2009 recession caused Greece’s unemployment to be higher than
unemployment in other countries.
H3: The 2007-2009 recession caused Greece’s inflation to increase.
Method
Subjects
The subject of the thesis is Greece. Industries examined include tourism and shipping.
Measures
The variables measure aspects of the Greek economy. The thesis will examine the
economic crisis of 2007 in Greece, the impact on the economy, Gross Domestic Product,
11
�public and private debt, the unemployment rate, and inflation, debt, and foreign direct
investment (FDI).
Table 1: Components of Study
Data
Instrum
ent
GDP
Inflation
Inflation
in
Greece
after the
2007
crisis
Greece’s
GDP over
the years
Visvizi(20
12),
Ioannides,
y., &
Pissarides,
c. (2015),
Karfakis,
c.,
Katrakilidi
s, c., &
Tsanana,
e. (2014),
Pegkas,
P., &
Tsamadias Data
, C. (2016) sources
Variables
Unemploymen
t
Greek crisis
Debt
FDI
General
Greece’s
information on
unemploymen the Greek
t rates after the financial crisis in
2007 crisis
2007
Karfakis, c.,
Katrakilidis,
c., & Tsanana,
e. (2014),
Mantalos, P.
(2015).
Michelis, L.
(2011).
Mantalos, P.
(2015),
Oldani, C., &
Savona, P.
(2010),
Ioannides, y., &
Pissarides, c.
(2015),
Karfakis, c.,
Katrakilidis, c.,
& Tsanana, e.
(2014),
Greek
Financial
debt
Importance
of FDI in
Greece
Baltas, N.,
Tsionas, M.
G., &
Baltas, K.
(2018),
Eimers, N.,
Nouwens,
J., &
Toorman, J.
(2005),
Monastiriot
is, V.
(2011).
Data
Source
Type of
data
gathere Quantitati Quantitat
d
ve
ive
Quantitative
Quantitative
Qualitative
Adapted from: Rudestam, K.E. & Newton, R.R. (1992). Surviving Your
Dissertation. Newbury Park, California: Sage Publications, Inc. page 140.
Table 2: Hypothesis, Instruments, and Statistical Analysis
Instrument
Unemploym FDI
Hypothesis
GDP
Inflation
ent
FDI
after the
H1: The 20072007
2009 recession GDP
crisis
caused
after
and its
Greece's debt
the
importa
to increase.
crisis
nce
Greek
crisis
Greek
debt
over the
years
after the
2007
crisis
Quantita
ve
Statistical
Analysis
Graph for
GDP
12
�H2(a): The
2007-2009
recession
caused
Greece's
unemployment
rate to
increase.
H2(b): The
2007-2009
recession
caused
Greece’s
unemployment
to be higher
than
unemployment
in
other countries
.
Greece’s
unemploym
ent rates
Graph for
unemploy
ment
Greece’s
unemploym
ent rates
compared to
other
countries
H3: The 20072009 recession
Inflation
caused
rates after
Greece’s
the 2007
inflation to
financial
Graph for
increase.
crisis
inflation
Adapted from: Rudestam, K.E. & Newton, R.R. (1992). Surviving Your Dissertation.
Newbury Park, California: Sage Publications, Inc. page 138.
Procedure
Literature Review
The research depends on statistical data sampled by many articles, websites and books
found during this research. Lastly, data collection aims at reflecting the reality of ordinary life
and also analyzing the combination of the Greece economy with the sociological elements.
Database: Business Source Premier
Google Scholar
Articles and books from the Wagner college Library
JSTOR
EBSCOhost
13
�Search Terms:
2007 Greek crisis, inflation in Greece, unemployment in Greece, Shipping in Greece,
Tourism in Greece, Greek financial debt, Greece after the crisis, Greek GDP, FDI in Greece.
Date: 1 March 2021 - 1 April 2021
Results
Analysis of the GDP, inflation and unemployment over the years.
Gross Domestic Product
The onset crisis that has been experienced by Greece has played a significant role in
the decline in trade that is evident in the region and this has subsequently affected the gross
domestic product (GDP) of the country. Between 2007 and 2008, Greece had a steady GDP
which showed potential for a steady economic growth, however, this slowly declined after
2008 and the only increase in the GDP was witnessed in the years 2018 and 2019 and
declined thereafter. Table 3 and Figure 1 contain data on Greece’s Gross Domestic Product
from 2007 to 2021. During this time, GDP declined from 240.04 billion Euros to 174.80
billion Euros, a decline of 27.2%.
Table 3: Greece’s Gross
Domestic Product
Year
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
Gross Domestic
Product
Euros % change
240,04
239,23
-0,3%
228,95
-4,3%
216,28
-5,5%
194,33
-10,1%
180,56
-7,1%
175,61
-2,7%
176,84
0,7%
176,11
-0,4%
175,25
-0,5%
177,49
1,3%
180,26
1,6%
183,61
1,9%
168,46
-8,3%
174,80
3,8%
(IMF. 2021)
14
�(IMF, 2021)
Inflation Rate
The inflation rate in Greece has witnessed a downward trend in terms of its inflation
rate and this has been attributed by various factors. Some of these factors are inclusive of the
higher food prices, increased oil price, and a higher rate of domestic consumption taxes.
Between 2001 and 2009, the competitiveness of the Greek economy declined by 20 percent
when measured using the consumer price, while the unit labor resulted in a decline of 25
percent. Table 4 and Figure 2 detail the past, current, and projected Greek inflation rates from
2007 to 2021. During this time, GDP increased from 106.4% to 120.13%, an increase of
13.2%. The rate increased from 2007 to 2011, then remained steady.
Table 4: Greece’s Inflation
Year
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
Inflation
106,4
110,9
112,4
117,7
121,4
122,6
121,6
119,9
118,6
118,6
%
change
4,2%
1,4%
4,7%
3,1%
1,0%
-0,9%
-1,4%
-1,1%
0,0%
15
�2017
2018
2019
2020
2021
(IMF. 2021)
119,9
120,9
121,5
119,9
120,1
1,1%
0,8%
0,5%
-1,3%
0,2%
(IMF, 2021)
Unemployment Rate
Table 5 and Figure 3 contain data on Greece’s Unemployment rate from 2007 to
2021. During this time, GDP increased from 8.4% 16.58%, an increase of 97%. The rate
increased from 2007 to 2013, then declined. From Figure 3 below we can also see that
unemployment reached its peak in 2013 and after that it started to steadily coming down. The
Greek labor market is directly linked to the structure of the economic system and the
improvements made within the public sector based on the activities conducted by the private
sector which leads to increased tax rates for both indirect and direct taxation. The
unemployment rate in Greece has been outlined in Table 5 and further translated in Figure 3
where the projections for 2020 and 2021 have been included.
Table 5: Greece’s Unemployment Rate
16
�Unemployment
Rate (%)
8,4
7,8
9,6
12,7
17,9
24,4
27,5
26,5
24,9
23,6
21,5
19,3
17,3
16,4
16,6
Year
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
%
change
-7,7%
23,9%
32,6%
40,2%
36,9%
12,5%
-3,6%
-6,0%
-5,4%
-8,9%
-10,0%
-10,2%
-5,4%
1,1%
(IMF. 2021)
(IMF, 2021)
In table 6 I have included important information about Greece’s exports over the
years 2014 to 2020 ( in millions of $) and their percentage change. As you can see exports
had a small increased till 2019 in comparison to the exports in 2014.
Table 6 : Greece's Exports
Year
2014
2015
Exports in
Millions $
35960
28554
% change
-20,6%
17
�2016
2017
2018
2019
2020
-1,4%
15,9%
21,1%
-4,0%
-7,4%
28151
32627
39502
37907
35094
(WTO. 2021)
In table 6 I have included important information about Greece’s imports over the
years 2014 to 2020 ( in millions of $) and their percentage change. As you can see in the
graph, imports had a small increase in 2019 in comparison with the imports in the year 2014.
Table 7 : Greece's Imports
Year
2014
2015
2016
2017
2018
2019
2020
Imports in
Millions $
61983
46786
46809
53495
63877
62510
55513
%
change
-24,5%
0,0%
14,3%
19,4%
-2,1%
-11,2%
(WTO. 2021)
Discussion
Gross Domestic Product
During the financial crisis, Greece experienced a decline in trade that subsequently
affected Greece’s gross domestic product (GDP). Between 2007 and 2008, Greece had a
steady GDP which showed potential for a steady economic growth, however, GDP slowly
declined after 2008, and the only increase in the GDP was in 2018 and 2019, and GDP
declined thereafter. The GDP in 2009 was reported to have a -4.3 percent change, however,
this significantly contracted to a staggering low rate change of 0.7 percent in the year 2014.
In 2019 it seems that the GDP percentage rate changed by 1.9 percent, however in 2020 the
percentage changed by -8.3 percent and it is projected to change again in 2021 by 3.8 percent.
18
�During this period, Greece’s imports and exports had almost the same percentage
changes in the years 2014 to 2020. Although, as we can see at Tables 6 and 7 Greece has
definitely improved the import and export in terms of millions of dollars per year from 2014
to 2021.
Some decline occurred in hourly productivity, and productivity in Greece declined
more than productivity declined in other European countries. This productivity decrease
indicates Greece is performing poorly when compared to other European countries. The main
contributors towards the Greece GDP include tourism services, shipping services (two
sections of the economy that discussed about in my literature review), food and beverages,
industrial products, petroleum, and chemical products where its key export markets are
mainly the European countries (i.e., Italy, Germany, Bulgaria, Cyrus, and the United
Kingdom), Turkey, and the United States of America. Greek GDP in 2020 was recorded at a 8.3 percent change which was a decrease from the 2019 GDP rate of 1.9 percent. It is,
however, predicted that this GDP will contract to 3.8 percent change at the end of the fourth
quarter of 2021. Table 3 and figure 1 highlight the Greek GDP rates from 2007 and further
portrays the predicted rate that accounts for the year 2021.
Inflation Rate
The inflation rate in Greece increased due to various factors (i.e., higher food prices;
increased oil prices; and a higher rate of domestic consumption taxes which resulted from the
deficit experienced from the 1990s until 2009 where the inflation rate subsided from a rate of
4.2 percent to 1.4 percent in the year 2009). Greece’s membership in the Eurozone allows
Greece to receive loans with lower interest rates because bankers and investors perceived that
the Euro currency effaced the differences that existed between Greece and European
countries prior to the introduction of the Euro.
19
�Furthermore, this provided increased capital inflows, however, these capital inflows
have influenced the inflation experienced in Greece reports that between 2001 and 2009, the
competitiveness of the Greek economy declined by 20 percent when measured using the
consumer price, while the unit labor resulted in a decline of 25 percent. prior to 2009, Greece
developed and implemented a monetary policy that aimed to fight against inflation which led
to a transition from a high inflation rate to a moderate one which was at 11 percent.
Unemployment Rate
Since its membership into joining the European countries in 1981, the Greek labor
force has been ranked as the leader in terms of the working hours per year across the
European countries. From 2007 until 2013 the unemployment rate in Greece increased
significantly but then started to decline again after 2013.
Also, from Table 5 we can see that 2008 was the year with the lowest unemployment
rate (7,75%) but then it started to increase and as of 2021, has not yet reached that low of a
rate. From the Figure 3 we can also see that unemployment reached its peak in 2013 and
after that it started to steadily coming down.
The Greek labor market is directly linked to the structure of the economic system and
the improvements made within the public sector based on the activities conducted by the
private sector which leads to increased tax rates for both indirect and direct taxation. The
unemployment rate in Greece has been outlined in Table 5 and further translated in Figure 3
where the projections for 2020 and 2021 have been included.
Conclusion
Greece has encountered a vast economic slump since it joined the EU. The problem
resulted from the unmatched economic might of the rest of the EU nations that Greece could
not compete. As a result, the country has amassed a considerable debt and comes to
20
�defaulting the loans. To solve the problem, the government has worked closely with the EU
member countries to regulate its economic operations, make efficient investment decisions,
repay the debt and even monitor its overall financial performance. Various policies imposed
against Greece have seen the country struggle with the debt and regain its economic power.
FDI is an alternative that has been commended as an ideal way of helping the country regain
some economic strength. The investments from foreigners have helped the country in
fundamental ways, but they still leave specific financial gaps. Therefore, despite the
resources injected into the economy, the government has much to do to ensure that the
country gets back on track towards prosperity.
From various investment projects introduced in Greece, such as tourism and shipping,
the Government has seen a transformation in the growth of its economy. Some of significant
investments that have been launched in Greece are in the field of Medicine, Tourism, and
Shipping. These sectors, mainly tourism and Shipping could be referred to as the main Greek
sectors because they are the backbone of its Economy. Besides, Greece is also advancing in
other fields such as food and tobacco processing, textiles, chemicals mining, petroleum, and
metal products. Therefore, it is right to say that if many people citizens and dual citizens took
it to their responsibility to invest, even more, the Greek Economy would transform for good,
and Greece would turn to be one of the wealthiest countries in the world. For instance, as we
can see at table 5 unemployment rates have went down almost 10 percent from the years
2013, where unemployment reached its peak in Greece, till today, 2021, with a prediction of
16,6 percent unemployment by the end of the year. Those investment sectors that I mentioned
above definitely opened up more job positions during the past years for Greek citizens to
work and unemployment to go down.
In recent years, the economy of Greece has shown clear signs of recovery and
improvement. For instance, the GDP growth in Greece in the year 2020 was around 183
21
�billion euros and focusing on the new tax bill and reformation program that has been
introduced to the country by the new Government, the GDP is expected to grow to 2% before
the end of next year if Covid-19 doesn’t slow down even more the global economy. All this
been said and analyzed, I came to a conclusion that Greece would be a good idea for someone
to invest, due to the country’s economic growth and rehab. After the 2007-2008 financial
crisis Greece seems to start to be standing on its feet again and more and more people to trust
the Greek economy for future and current investments.
22
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26
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Investing in Greece: Good or Bad Idea?
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Workplace Nutrition & Productivity
Workplace Nutrition and Productivity
Nicoletta Krauze
Senior Thesis & Practicum
April 29, 2020
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Workplace Nutrition & Productivity
Abstract
Nutrition and physical activity are very important to one’s health. The purpose of this
study was to examine workplace nutrition and physical activity taking into specific consideration
the effects of these initiatives on employee productivity. Unhealthy eating habits among
employees have steadily increased over the years. Hence, the need for physical activity and
healthy nutrition has become crucial. This study was intended to determine the impact that
healthy eating and physical activity has on employees and increase awareness on ways to
manage a diet. Published articles were utilized to identify and examine ways in which employees
who consume unhealthy foods and exercise minimally are less productive, while employees who
consume healthy foods and exercise maximally are more productive. The published articles
included mostly information on healthy and unhealthy eating, eating disorders, obesity, free fruit
interventions and physical activity. Microsoft and Google Corporations were used for this study
to identify the accomplishments of overall health and well-being of their employees. These
findings may be used by workplace managers and health professionals to assist in planning or
implementing a wellness program in their organization.
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Workplace Nutrition & Productivity
Introduction
Food choices are a common factor of unhealthy eating in the workplace, as they are
influenced by your personal preference, the time of day, and social groups. Most people tend to
pick what is easiest and fastest to consume during their workday. These choices are made
quickly to satisfy their hunger, but without thought of whether the food choice will satisfy
overall health and productivity. For instance, consuming a slice of pizza will tend to make
someone tired and not give them any brain power, but it is easy and inexpensive, and is therefore
chosen without prioritizing health. The food that is provided in workplace cafeterias also
influences the food choices employees make. It is therefore essential to investigate how
workplaces can contribute to healthier choices. Encouraging employees to consume a healthy
diet should be taken into consideration by all corporations because a healthy diet will result in
more productivity, energy, and motivation.
Zero hunger is the second Sustainable Development Goal of the United Nations, making
nourishment crucial to promote the overall health of every human being. In order to live a
healthy lifestyle, people have to purchase groceries from food service organizations, which in
return leave these organizations with an income. Today, many countries in Africa are
tremendously affected by hunger and poor nutrition. Two ways one can participate in civic
engagement related to the Zero Hunger SDG is through voting on surveys or volunteering to help
people learn to consume healthy foods that increase your overall health. Volunteering is most
beneficial because people can learn from each other face-to-face and gain more experiences.
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Workplace Nutrition & Productivity
Literature Review
The following review of literature is relevant to the topic of workplace eating habits and
seeks to examine the effect on employee productivity. The review will examine the importance
of a well maintained, healthy diet for employees in the workplace.
The literature review will provide analysis on healthy diets as implemented in workplaces
and studies indicating the results of eating habits and productivity. This will lead to findings on
the importance of having a healthy diet in the workplace for increasing productivity of
employees. Employers and employees will benefit substantially due to employees having high
productivity land employer financially.
Overall, the literature review will provide confirmation of how a healthy diet increases
productivity levels of employees. It will provide evidence to support the argument that a healthy
diet in the workplace has a positive effect on employees and their productivity.
Healthy Eating Habits in the Workplace
Types of food provided (fruit/veggies vs. junk food)
People spend a lot of time at their workplace, typically 8 hours a day. Most people tend to
choose to eat unplanned foods, which are foods they rely on buying during their work shift or
foods that are brought in by their colleagues (Leung et al., 2018). Due to busy work schedules,
people have engaged in unhealthy behaviors and failing to meet recommendations to improve
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Workplace Nutrition & Productivity
diet. The majority of people are unaware of their weight status and need to change their health
behaviors into healthier living that can result in actual behavior change.
Healthy eating habits in the work environment have been a growing concern for most
organizations and employees. Unhealthy eating behaviors and physical inactivity have been
linked to a substantial burden to the economy including low productivity. Studies have shown
that lost productivity emanates from the following two sources: presenteeism (an individual
experiences reduced productivity at work); and absenteeism (lost productivity because the
employee spends time away from work due to disability or illness) (National Institute for Health
and Care Excellence, 2015). The workplace presents a perfect environment for promoting
positive health behaviors as well as reaching the majority of people in society (Leung et al.,
2018). The workplace makes it possible even to reach individuals that may have proven difficult
to reach, for example, young people from lower socioeconomic status.
Fruit and vegetable intake have been addressed extensively in the literature. The
programs that focus on increasing the intake of fruits and vegetables at work should address
individual employees as well as their social networks for maximum effects and the programs
should also consider a change in the food environment. The provision of fruits and vegetables at
work ultimately increases their consumption at the worksite.
Effectiveness of Wellness Programs for Increasing Productivity
The effectiveness of a wellness program depends on the nature of the program and on
how the organization defines success. Some scholars have argued that workplace
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Workplace Nutrition & Productivity
health-promoting programs are a waste of money for organization and do not provide a return on
investment (Langille, 2013). Also, workers must develop self-efficacy and knowledge of
workplace nutrition and their wellbeing for there to be effectiveness of a health program.
Promoting positive and healthy nutritional behavior at work can initiate improvement of
employee health and enhance business performance. Research shows that nutritional
interventions and workplace physical activity entail education, counseling, and on-site group
activities. Using these three components at work can significantly improve employee eating
behavior and physical activity (National Institute for Health and Care Excellence, 2015).
Consequently, the three components improve mental and physical health and a positive return on
investment – healthcare costs are reduced, and employee productivity increases (Lake et al.,
2015).
Research has examined the effectiveness of different interventions on workplace
nutrition. The studies reveal that there is a need for workplace nutrition interventions to alleviate
their economic burden of poor nutrition and to improve employees’ performance (Lake et al.,
2015). Knowing the positive work-related and economic outcomes of different interventions for
workplace health promotion will increase investment in nutritional strategies.
In recent years, mindfulness has become more known and a result of unhealthy eating
behaviors made by people (O’Reilley et al., 2014). Mindfulness is a quality of consciousness that
comprises of continuous attendance to one’s instant-by-instant know-hows, views, and feelings
with an open-minded tactic. There are ways to cope with mindfulness by incorporating
meditations and exercises. Interventions for health issues ranging from anxiety to substance use
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Workplace Nutrition & Productivity
relapse all that embrace mindfulness practices (O’Reilley et al., 2014). Different mindfulness
approaches have been developed for clinical treatments. For example, Mindfulness-Based Stress
Reduction (MBSR) for pain management and stress-related disorders, in addition to
Mindfulness-Based Cognitive Therapy (MBCT) for prevention of major depression related
obesity (O’Reilley et al., 2014). Mindfulness training is a platform that offers individuals skills
that permit them to mitigate maladaptive eating manners. Resultantly, persons can overcome
obesity and overweight related maladies and, as such, develop a positive attitude with food.
How to create healthy eating at work
Effects of on-site café/lunchroom offering healthy foods
Workplace interventions have the capability to target a large proportion of the adult
population and are an ideal strategy that promotes healthy lifestyles more so in today’s era where
economic times are tough, and people have to work extremely hard to have a comfortable life
(Lake et al., 2016). Employment and the workplace surrounding are critical factors that
contribute to food choice and eating modalities.
Studies have shown that employees would benefit incorporating desk-based eating would
allow employees to eat pre-prepared foods rather than waste time on thinking of what to buy and
if it is healthy or not (Lake et al., 2016). Another employee mentioned that instead of having a
tea trolley, management should incorporate a fruit trolley (Lake et al., 2016). The
implementation of offering pre-prepared foods and fruit trolleys to circulate throughout the
offices of a workplace would assist employees in making healthful decisions on what they are
going to eat. Studies have also shown that employees would significantly benefit from
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Workplace Nutrition & Productivity
incorporating meals-to-go and on-site farmers’ markets (Devine et al., 2007). The
implementation of retaining an on-site café or lunchroom would allow employees to confide in
healthy foods provided by chefs who are educated in the food they would provide. The
availability of these features on the worksite would encourage employees to live a healthful life.
Effects of gyms, sports facilities, free workout classes, etc.
Studies using the socio-ecological model reveal that healthy behavior emerges when
there is an interaction between the individual and the environment (Devine et al., 2007).
Therefore, promoting changes in dietary behavior at work should entail changes in the
organizational structure and changes in the physical environment of workplace. Positive
nutritional behavior is facilitated when there is a significant change in the organizational
structure of the business (for example, policies) and the physical environment of the workplace
(like stocking vending machines at the workplace with healthy foods). However, there is
insufficient or conflicting evidence about work-related outcomes of these organizational and
environmental changes (Leung et al., 2018). Further some employee habits may jeopardize the
objective of the health programs, for example, assuming too much, being selfish, believing that
they can be productive without changing their eating habits and so forth (Goldsmith, 2007).
Businesses that have measured the health and wellbeing of their employees have revealed
that most employees do not exercise enough, many employees are overweight, and many
employees have risky health factors, such as high blood pressure or elevated cholesterol (Leung
et al., 2018). These factors are linked to diseases like diabetes, heart disease, and other chronic
illnesses (Leung et al., 2018). Most organizations are now increasingly investing in health
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Workplace Nutrition & Productivity
promotion to improve their employees’ health and curb healthcare costs. Organizations have
introduced several programs and initiatives to encourage positive health behaviors such as eating
healthy, exercising, reducing risk factors for chronic disease, and quitting smoking. Studies have
shown that almost 50% of organizations with 50 or more workers have at least one health
promotion initiative in place. Large organizations like Microsoft have wellness programs such as
fighting obesity among employees (Sweeney, 2002).
To be successful, a program meant to alter the eating of workers should target different
aspects, such as, the influence of a coworkers, the availability of healthy food in the cafeteria and
the availability of counseling (Leung et al., 2018). Counseling is necessary because most people
resort to eating junk food because they are stressed (Leung et al., 2018). Work schedules should
be arranged to discourage people from eating unplanned food at work and to provide enough
time for people to seek healthy food.
Research stressed the significance and effectiveness of introducing workplace dietary
programs. Several food types are targeted by organizations including fiber, red meat, fat,
vegetables, and fruits.
Google and Microsoft have had a significant impact in changing one or two employee
dietary behaviors. Google and Microsoft have health-promoting programs that focus on
increasing vegetable and fruit intake, and these programs also address the social context of the
workers.
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Workplace Nutrition & Productivity
Research indicates that programs are effective when employees are encouraged to
participate and address their health-related behavior (Devine et al., 2007). Therefore, the
effectiveness of the health behavior-changing programs at work depends on the nature of the
programs and on how well the workers participate in the programs. However, it was revealed
that employees will have time to exercise if facilities are on the same property as their
workstations. Research found that food and eating are affected by sociocultural aspects such as,
stress-related eating, being enthusiastic about the health-promoting programs sponsored by the
organization that protects workers’ privacy, and the policies that dictate how one accesses food
and the place of eating (Devine et al., 2007).
Healthy behaviors can be promoted or impeded by cultural norms of the workplace and,
convenience to general foods at the place of work (Payne et al., 2013). Therefore, health
programs must address these aspects for maximum success (Payne et al., 2013). Self-regulating
can also play a significant role in promoting healthy behaviors in the workplace (Liu et al.,
2017), but self-regulation can only happen if the individual is knowledgeable about the need for
healthy behavior and good nutrition.
In conclusion, programs initiated and implemented by the organization for improved
employee nutrition are meant to serve the interest of the organization and the employees.
Therefore, these programs should be designed to make cafeterias accessible, bring healthful
foods closer to employees, and to highlight healthful options.
Hypotheses
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Workplace Nutrition & Productivity
H1: Healthy eating (fruits/veggies) will help increase productivity
Healthy nutrition in the workplace helps employees increase their productivity by
benefiting from eating fruits and vegetables. A strategy was conducted to educate chefs and
managers to create a healthier menu in the cafeteria to satisfy employee preferences and health
concerns and make healthier options more available (Devine et al., 2007).
H2: Employees will have time to exercise if facilities are on same property
Many employees work hours are from nine o’clock in the morning to five o’clock in the
evening sitting at their desk with little movement. After an employee is finished with their job,
they typically go home, eat dinner, and go to sleep. A study was shown that eating healthy foods
has increased employees’ perceptions to exercise (Lake et al., 2016). Corporations including
wellness programs with on-site exercise facilities would encourage employers to exercise before
work, during their break, or after their shift.
Method
Subjects: Google and Microsoft focus on the healthiness of their employees
Research Design
The research adopts a descriptive study design. This design would be appropriate to
identify the study objectives and adequately analyze them to acquire information about the
factors that enhance the adoption of healthy lifestyle practices among employees. The focus of
the research will be on Google and Microsoft, organizations that have made significant efforts to
improve the health of their employees.
Sources of Data
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Workplace Nutrition & Productivity
The research relies on published articles from a couple sources. One source that was used
was OneSearch from the Wagner College Horrmann library. It included peer-reviewed and
non-peer-reviewed articles. Another source was the United Nations website for Sustainable
Development Goal. Lastly, official websites for Microsoft and Google were used.
Methods of Data collection
The terms searched in the database were as follows: “Workplace” AND “Productivity”;
“Nutrition” AND “Productivity”; “Nutrition” AND “Workplace”; “Google” and “Productivity”;
“Google” and “Nutrition”; “Microsoft” and “Productivity”; and “Microsoft” and “Nutrition.”
Measures: gym memberships, free sports facilities, free fruit, on-site café/lunchroom
Measures
Lunchrooms or on-site cafés, free fruits and vegetables, free sports facilities, and gym
membership have been incorporated by Microsoft and Google.
Procedure: incorporating gyms and healthy food has improved effectiveness of
productivity and overall health
Procedure
Gyms and healthy food have improved effectiveness of productivity and overall health in
Microsoft and Google by having these procedures implemented.
Data Analysis
Employees who work for organizations such as Microsoft and Google have the benefits
of on-site café’s and gyms. The on-site café’s offer healthy dining options that employees can
take advantage of on a daily basis. Obesity has been a major factor of unhealthy diet. Microsoft
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Workplace Nutrition & Productivity
and Google have incorporated wellness programs to try to prevent obesity and overweightness
for employee’s overall health (Sweeney, 2002). Microsoft set their target audience to employees
who are forty to fifty pounds overweight (Sweeney, 2002). Employee health has increased when
wellness programs were introduced. Microsoft and Google imply that living a nutritious lifestyle
benefits their employee’s overall health.
Results
H1: two successful companies incorporated healthy work environment
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Workplace Nutrition & Productivity
Figure 1: Theoretical line chart assessing Google’s fruit, vegetable, and fitness intake after
incorporating a wellness program.
The line chart above indicates Google’s vast increase in fruit, vegetable, and fitness
intake after introducing a wellness program to its employees. Based on a theoretical speculation,
the fitness aspect of Google’s employees increased tremendously due to facilities being easily
accessible. Vegetable and fruit intake increased due to accessibility also.
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Workplace Nutrition & Productivity
Figure 2: Theoretical pie chart indicating the use of Zumba classes, walking/running
tracks, gym, and basketball courts by Microsoft’s employees.
Microsoft has lots to offer in the physical activity component for its employees. Zumba
classes, walking/running tracks, gym, and basketball court are some examples of what they have
to offer. Based on a theoretical speculation, 90% of employees used the gym; 60% used
walking/running tracks; 40% used basketball courts, and 30% used the offering of Zumba
classes.
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Workplace Nutrition & Productivity
H2: free gym memberships on job sites are beneficial to employees due to easy access
Figure 3: Graph indicating a lifestyle management component of a wellness
program with importance offering from greatest to least including nutrition/weight,
smoking, fitness, alcohol/drug abuse, stress management, health education, and other in a
lifestyle management program (Mattke et al., 2013).
Nutrition/weight was ranked first, as the most important at 79%. Fitness was ranked third,
as the third most important at 72%. Employees understanding the importance of a healthy diet
and weight intake will provide better overall health. Free gym memberships will result in more
fitness, weight loss, and healthier nutrition amongst employees. The graph is a representation of
how results would look like in a research that involves incentives of encouraging one to go to the
gym and practice healthy eating (Mattke et al., 2013).
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Workplace Nutrition & Productivity
Figure 4: Graph indicating a wellness program component of lifestyle management and
disease management (Mattke et al., 2013).
Fitness is very important in incorporating into a wellness program. The graph is a
representation of how likely employees are willing to attend each wellness program component.
It was ranked 21% as most attended program. Smoking cessation was ranked at 7% with least
likely to attend. Weight/obesity were ranked second least likely to attend at 11%. Employees are
more likely to attend a fitness program than a weight/obesity program because of personal issues
and preferences.
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Workplace Nutrition & Productivity
H3: employees are more aware of their health and well being
Figure 4: Linear regression lines with a predicted line for men in selected countries of
Europe and the world (Krzysztoszek et al., 2015).
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Workplace Nutrition & Productivity
Figure 5: Linear regression lines with a predicted line for women in selected countries of
Europe and the world (Krzysztoszek et al., 2015).
The two figures above show an upward trend that characterizes an increase in obesity
globally. In America, only obese men account for more than 40.8%, while women are more
obese at 46.0%. Further, the increase in obesity prevalence in women over 60 years old has
increased from 28.8% to 37.2%. This could be attributed to perimenopause period when weight
gain is observed in 60% of women with a simultaneous redistribution of body fat (Krzysztoszek
et al., 2015). It is estimated that Americans will be 100% obese in 35 years to come.
Discussion
healthy eating habits in work environment
fruit/veggies vs junk food & effectiveness of productivity
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Workplace Nutrition & Productivity
Based on the results, Google and Microsoft corporations have effectively incorporated
healthy work environments. The corporate culture can help the employees to encourage each
other to eat healthily and use training facilities provided within the organization premises. They
can also encourage each other to eat fruits and vegetables rather than junk food. Nutritional facts
can be displayed for all employees as well as healthy facts can be added by each shelf of food.
The availability of fruits within work premises are responsible for improving employee
intake of vegetables. Inquiries on the adoption of healthy eating habits at home yield a positive
impact with more employees acknowledging that the provision of healthy foods in the workplace
influences them to adopt the practice at home. Also, an increase in fruit and vegetable intake
among employees when an organization creates the provision of healthy food options in the
in-house café.
Employees should have availability to fruits such as apples, oranges, and bananas to
increase productivity throughout the day. Café’s should offer vegetables such as avocadoes,
broccoli, and kale to boost productivity while on your lunch break. Currently, many
organizations do not offer wellness programs or at least fruits and vegetables to their employees.
Employees go out of their way to eat unhealthy snacks that they bring from home or leave the
office to buy lunch, which most likely is something quick from a fast food restaurant.
how to create healthy eating in work environment
on-site café/lunchrooms & having gyms, free workout classes, etc.
An organizations management has a pivotal role to play since they can encourage team
members to take part in a workplace intervention. Management should educate their employees
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Workplace Nutrition & Productivity
to understand the important of health and wellbeing. They should also inform their employees of
advantages they have implemented and what they can use.
Most employees are not interested or find it hard to visit the gym or training center due to
demanding work schedules that require them to prioritize other responsibilities over going to the
gym. Healthy foods and training facilities can be Provision of a free membership would increase
employee likelihood of joining the gym in the workplace. More people are willing to use the
facilities provided by the organization when they know that it is free. Also, having a free gym
membership for employees to join on-site gyms is beneficial to most employees.
Accessibility is also a factor that enhances the use of the gym on worksites. The ease of
access was the motivation to use the facilities during their free time. Busy schedules and heavy
workloads are significant barriers to making time for exercise. Furthermore, having the gym at
worksites is significant in encouraging employees to adhere to joining the gym as a way of
adhering to healthy lifestyles. Many employees could agree that joining the gym has a positive
impact on their morale to work. After joining the gym, many employees can identify having
increased productivity. Employees are able to encourage those around them to join the gym after
experiencing increased productivity and overall health.
The efforts of having on-site lunchrooms or café’s and gyms are essential in enhancing
the health and wellbeing of employees. Most employees become more aware of their health
compared to previous periods, due to incorporating these features in their workplace. The
provision of some of the facilities has ignited a need to take their health more seriously.
The development of programs to encourage employees to have healthy lives has a
positive impact on them and their families. Most employees transfer the knowledge to their
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Workplace Nutrition & Productivity
families and friends hence increasing the level of awareness of healthy eating within the
workplace. Also, awareness of what those around you eat and do in order to stay healthy has an
influence on what you will eat. Mostly, employees are responsible for each other’s health, and
they can ensure that those around them are living healthy. Finally, most employees acknowledge
that the health efforts made in organizations also increase the awareness of the community. Most
workers share and discuss the efforts and knowledge gained from the workplace with members
of society, which increases their level of awareness on the matter.
Conclusions
Implications for practice
A review of the literature has revealed limited sources on nutrition, physical activity, and
productivity in the workplace. This study has provided an extraordinary opportunity to explore
nutrition, physical activity, and productivity at job sites. The results of this study validated the
assumption that fruit and vegetable intake is more beneficial than eating junk food. In addition,
the results clearly showed that implementing a wellness program with features such as on-site
cafes and fitness centers will increase employee productivity. Also, this study incorporated two
corporations, Microsoft and Google, to clarify that implementing a wellness program is
beneficial.
Implications for research
The research question focused on the overall health of employees in workplaces and how
creating a healthy work environment benefits the employer and employee. Even though the study
only focused on healthy eating and physical activity, it revealed a positive association between
healthy eating, physical activity, and productivity in the workplace. Understanding the
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Workplace Nutrition & Productivity
importance of fruit and vegetable intake and fitness facilities can help in developing a wellness
program. Offering on-site cafes and fitness facilities will encourage employees to utilize them
and become familiar with healthier choices. Finally, this study helped to clarify the importance
of implementing a nutritious diet, on-site cafes, and fitness facilities.
References
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Goal 2: Zero Hunger - United Nations Sustainable Development. (n.d.). Retrieved from
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Goldsmith, M. (2007). Which workplace habits do you need to break to become more
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How we care for Googlers. (n.d.). Retrieved from
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Workplace Nutrition & Productivity
Krysztoszek, Jana., Wierzejska, E., Zielinska, A. (2015). “Obesity. An analysis of
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Lake, A. A., Smith, S. A., Bryant, C. E., Alinia, S., Brandt, K., Seal, C. J., & Tetens, I. (2016).
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�
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Workplace Nutrition and Productivity
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Nutrition and physical activity are very important to one’s health. The purpose of this study was to examine workplace nutrition and physical activity taking into specific consideration the effects of these initiatives on employee productivity. Unhealthy eating habits among employees have steadily increased over the years. Hence, the need for physical activity and healthy nutrition has become crucial. This study was intended to determine the impact that healthy eating and physical activity has on employees and increase awareness on ways to manage a diet. Published articles were utilized to identify and examine ways in which employees who consume unhealthy foods and exercise minimally are less productive, while employees who consume healthy foods and exercise maximally are more productive. The published articles included mostly information on healthy and unhealthy eating, eating disorders, obesity, free fruit interventions and physical activity. Microsoft and Google Corporations were used for this study to identify the accomplishments of overall health and well-being of their employees. These findings may be used by workplace managers and health professionals to assist in planning or implementing a wellness program in their organization.
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