Abstract

This dissertation is to examine the effect of stress on employees’ productivity in microfinance institutions in Buea. The study aimed at determining the effect of stress on employees’ productivity in microfinance institutions and was guided by two specific objectives; to examine the extent to which work stress influenced employees’ productivity in microfinance institutions in Buea and to examine the effect of non-work-stress on employees’ productivity in microfinance institutions in Buea. The study made use of descriptive design.

The researcher begins with the idea that there exists a relationship between work stress and employee productivity.  It involved a total population of 74 respondents out of which 61 were identified as the sample size. Two methods are used for the analysis of the current study; descriptive and inferential methods.

The results of the study revealed that the degree of agreement with all components of stress is very high, and the effect of stress on employee’s productivity is significant and positive. The study recommended that organizations should minimize stress while maximizing productivity by having an understanding of the factors that influence employee’s stress; hence creating a supportive organizational climate.

CHAPTER ONE

INTRODUCTION

1.1 Background to the Study

The microfinance sector is becoming more competitive as a result of the rising needs of customers and the upsurge of other financial institutions. Conditions as such require institutions like this to provide quality service and satisfy the changing needs of customers. The success of achieving this lies on the inputs of every employee of the institution. Therefore, in order for the institution’s operations to be efficiently conducted, it is imperative for the employees to perform at their very best so as to attain the goals of the institution (Mark, 2012). Employees’ productivity is an issue of concern within any institution.

Stress at the workplace is considered as one of the foremost factors affecting employees’ productivity. When work stress comes into play, employees’ face difficulties in focusing, meeting task deadlines and making use of their creativity. Most importantly, stress triggers a majority of health concerns that tend to impact employees’’ productivity and they include depression, anxiety, conflict, anger and burnout. The stress of one employee has an impact on how effectively the entire team collaborates, and this is a phenomenon most human resource departments know too well and should be an issue of concern in managing institutions (Patti, 2021).

Several factors account for employees’ productivity among which stress appears as an integral part. Stress is a fundamental part of employees in microfinance institutions due work-related stress such as poor working conditions, work overload, work ambiguity, unrealistic demands, lack of recognition, organizational change etc., and non-work-related stress such as family demands, marital issues, child rearing etc., (Debra et al..,2003).

There exist various definitions of stress since the concept was described and named by Hans Selye (Selye 1950), who defined stress as “the non-specific response of the body to any demand”. The World Health organization (WHO) defines occupational stress as the response people may have when presented with work demands and pressures that aren’t matched to their knowledge and capacities and which challenge their capability to manage. Other definitions include Lazarus and Folkman (1984) etc.

Many researchers argue that stress at workplace has an impact on productivity in one way or the other. Mark (2012), viewed work related stress as a leading cause for low productivity in the workplace. Debra et al..,(2003) stated that stress affects the organizational outcomes such as decrease in productivity, increase in absenteeism and dissatisfaction. Also, Patti (2021) observed that the consequences of organizational stress are far-reaching leading to reduction in the quality and quantity of job performance.

According to Fenton-O’Creevy et al., (2005), hardworking and valuable employees who experience negative experiences in the workplace, have their hopes dashed, their goals derailed and or their confidence undermined. He asserts that organization should endeavour to identify emotional pain, when it occurs and act to intervene, potentially lethal situations in the work place, can be reversed.

1.2 Problem Statement

Employee productivity has become a relatively important factor for the success of the organization, since the vision of every organization is to have high productivity; sadly, not all organizations enjoy high productivity. Till this date, employee productivity is a challenge to many organizations, Atambo (2018).

According to Fenton-O’Creevy et al., (2005), in the financial industry there is an increasing need for employees at different levels and in different subgroups in the organization to hold the necessary skills and motivation to carry out the core tasks associated with their works and also acquire additional abilities in handling demands which are accompanied by an ever-increasing stress.

Stress is an unavoidable aspect of the challenges which leads to the acquisition of new abilities and behavioural patterns. However, when stress levels in individuals get too high, it poses a problem. In today’s life, people spend almost half of their life working because they want to available for themselves good structures, goods, and services. Satisfaction is also obtained from performing the jobs, but these jobs add up worries and stress in the lives of employees.

The experience of stress varies from person to person, this is seen where some are affected more than others based on the nature of their jobs. Working in a financial institution can be very stressful based on the quest for beating the market competition, difficult customers, poor deplorable working conditions, work overload, poor interpersonal relationship and benefits, lack of managerial support, role ambiguity, etc. All these are leading factors of job stress and they tend to affect the productivity of employees in different micro financial institutions.

Due to the different types of stress which can affect productivity, it can also lead to absenteeism, and even poor customer service in the different financial institutions (Banyi et al., 2021). In Microfinance institutions in Cameroon, employees’ face a shed load of challenges in relation to their work place environment, these challenges include workload, relationship, role ambiguity, lack of recognition, family issues financial issues, health related issues, Banyi et al., (2021).

The cognitive performance and decision making of these employees are adversely affected as a result of stress. The negative effect of the problem of stress is seen where; increased stress leads to reduced productivity. Thus, where stress is not controlled, the individual and the organization suffer. In microfinance institutions today, role ambiguity, work overload and family issues are examples of what causes stress. Employees’ who face these challenges are affected in such a way that their productivity reduces and this affects the institution they work in. The problem of stress faced by employees in MFI brings the researcher to question the effect of stress on employees’ productivity in the service industry of micro-finance institutions in the Buea Municipality.

Given that Cameroon already suffers from high unemployment rates, more labor disputes and work shortage, a deteriorating economy, stress in the working population can manifest itself in various forms. There is therefore a need to study the effects of stress on employee productivity and the policies that employers can use to address stress issues in the workplace.

1.3 Research Questions

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