| Although scholars have endorsed the view that individual affective adjustment may help firms adapt to change, an organization-level mechanism of adaptation, employee flow (hiring and turnover), has long been neglected. Indeed, the majority of previous research in this area has relied exclusively on employees who are present both before and after change. As a result, the potentially important role of employee flow into and out of organizations in organization level adjustment to change remains to be studied. To address this issue, I build upon organizational sorting and attraction-selection-attrition (ASA) perspectives to move beyond the traditional focus on individual adjustment mechanism and examine the role of workforce restructuring in firms' adaptation at the organizational level. Using employee-employer linked data in 529 firms from 2005 to 2011, I found that employee flow moderates the relationship between organizational change and firms' collective employee satisfaction (both the mean score and the variance score). More importantly, by using this multilevel and longitudinal data, I discovered the existence of a prototypical pattern of collective employee satisfaction in changing organizations: an initial declining and heterogeneous trend in collective satisfaction is followed by a recovery at a later time. Meanwhile, this pattern of collective employee satisfaction depends on both the overall degree of employee flow (i.e. hiring and turnover) and the composition of employee flow (i.e. hiring vs. turnover). Results suggest that employees who dislike change or who are a poor fit with change might leave, and the resulting inflow and outflow of employees can help the organization adapt more effectively than if it had relied only on individual adjustment. |
