tional social/psychological employment contract. To illustrate, the 1994 American Management Association survey on downsizing found that while 86 percent of companies that had downsized reported that employee morale declined, employee productivity rose or held constant in 70 percent of downsized companies; profits rose or held constant in 80 percent (American Management Association). A survey conducted by human resources managers of employers who restructured reported adverse effects on morale and commitment but also increases in productivity, service levels, and greater competence among employees (Wyatt Company, 1993). These reports were based on self-assessments. Despite the enormous changes and the collapse of employee morale, employee performance did not seem to decline enough to affect corporate performance. No doubt the context of downsizing across most of U.S. industry from the 1980s through the mid-1990s caused enough fear among workers to prevent declines in their performance.

Employer efforts to articulate a new deal governing the employment relationship have been driven by an understanding within organizations of the profound way in which they have unilaterally broken the old deal and concerns about the possible negative consequences that doing so may have on employee behavior. Most of these efforts have focused on being explicit about the limits on employer obligations, simply being clear that the employer can no longer guarantee job security and that employees have to look out for themselves. The word "employability" is typically used to describe these employer-initiated efforts to craft a new social/psychological contract. It focuses on the new and much more limited obligation of employers to help (but not provide or ensure) their workers develop skills that will continue to be in demand, if not with their current employer then with another. How employees will respond to this and what else might be part of the emerging social/psychological contract is less clear.

Some indication about the nature of the new employment relationship can be obtained from employee surveys. A survey of 3,300 employees by Towers Perrin asked respondents about their perceptions of the new deal in the workplace. Employees recognized that lifetime employment with one company is unrealistic—and may also be undesirable for them. Only 45 percent felt

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