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Wednesday, September 25, 2019

Career Transitions: Equipping for the Future, Identity Loss, and Avoiding Trends: Interview with Elaine Bontempi, Ph.D.

We are very proud to offer another very valuable interview with Dr. Elaine Bontempi.  This is one of a series, which you can find this website  For more information, please visit:

As people seek to equip themselves for the future, what should they consider when they make decisions? Especially if they are experiencing a transition in jobs?

The best thing a person can do when they are forced to make a career change is to take the time to invest in themselves. This includes their mental and physical health, continued education, networking, skills training, and the help of a Career Transition Coach. Nobody can accurately predict the future, but in the face of a career change, simply updating a resume is not enough. You need to rely on new and better ways of networking, especially in a downturned economy, highly competitive field, or if you are over 40. Take the time to learn skills that will allow you to compete with tech savvy competitors, but also use this opportunity to make an inventory of your skills and passions. What do you enjoy doing?  What are you good at? What do you stand for? What areas are you interested in improving? Where do you want to be in your career 5, 10 or 20 years from now?

Sometimes a job loss is a blessing in disguise as it might be the “push” you needed to send you into a career that is a better fit. One that taps into your passions and energizes you, causing you to feel enthusiastic as you face each work day, rather than dread as you go to work each morning.

Take an inventory of your skills, education, and experiences, but also your passions and interests. Most organizations are not just looking for a good resume. Instead, they are seeking someone who is passionate about their work, demonstrates creative problem solving, is a good personality fit with other employees, shows commitment, and can make a positive contribution to the organization.

There is stress along the way as people deal with the transitions that come with quickly changing job responsibilities or workplaces.  How might this affect one’s sense of identity and the way they fit in with society? 

Changes in the workplace come in many shapes and sizes. These may be as small as adding new job responsibilities requiring additional learning and training. Some are much larger and including job transitions. Although some of these changes may be the result of personal choice as people seek higher pay or jobs more are aligned to their passions and interests. Other times transitions were not out of choice and the result of company layoffs, injury, or illness.Transitions made out of choice are in general, much easier to deal with than those that were not.

As we enter into a new workplace, the organizational culture is almost guaranteed to be different from that of the one we just left. This requires adjusting to the new organizational culture, styles of leadership, and workplace dynamics. With each level of demand comes increased need for adaptation. Thus, adaptability and stress management techniques will come front and center.

When it comes to our careers, sometimes our sense of self identity is so caught up in what we do or how much we earn, that when that shifts, we lose our sense of self. When such changes come, we often find ourselves chasing what we used to do or trying to ride out the storm, thinking things will eventually go back to how they used to be after the storm passes. The old way was comfortable and easy, and so we resist any changes. Yet, by resisting change we risk chasing the ghosts of the past and barely “surviving” the storm, rather than simply packing up and getting out of the storm’s path.

If we insist on “riding the storm out” we resist leaving until it either gets so uncomfortable that we can no longer bear it, or we are forced out. Economic down turns have forced many people out of once thriving and lucrative careers, and technology threatens to replace the jobs of others. When we realize we simply cannot return to the career, job, or the level of ability we had before, we are forced to reinvent ourselves. However, this is not easy, and especially if we have built a lifetime pursuing dreams or building a career. It’s much easier to reinvent one’s self when one perceives they had choices in doing so, but if a job was lost due to a changing economy, illness or disability, then things get much more complicated.

Sometimes people allow their careers to define them without even realizing it. But when faced with a sudden loss of job or status, a sudden identity crisis quickly ensues. This new reality can be extremely shattering to one’s sense of self, as people realize that their careers, titles, or salaries were their source of acceptance. This is a hard lesson to learn because a sense of self-worth based on external things such as career, income, or title are all conditional forms of acceptance and approval. Thus, when these things are absent, approval also disappears. It is at this point that some of the hardest lessons in life are learned. The high paying executive, surgeon, or professional athlete who was once at the top of their game soon discovers that their “friends” are nowhere to be seen when they have fallen from the top. However, these adversities allow us to discover who we really are and what we are made of. While some people evolve, others shrink back and never recover.

Thus, in order to promote a smooth career transition, take the time to invest in yourself, gaining new skills if necessary, researching your options, analyzing your skills, competencies and passions, and creating a career plan. Understand that experiencing a range of emotions including fear, rejection, and uncertainty is normal, and consider seeking the help of a Career Transition Coach to help you during this process.

What happens if a person simply tries to follow what seems to be the hottest career path right now?

Chasing the Wrong Goals
This can get a person into trouble for several reasons. Chances are if an individual is seeking a career just because it is “hot” then they are focusing on pay. And, although nobody will deny that it is desirable to earn more money than less, pursuing extrinsic goals in the long run will not only decrease motivation but also psychological well-being. Not to mention, trends are constantly changing, and when everyone jumps on the “trend” wagon, supply and demand takes a toll, resulting in an over-abundance of skilled workers. When there are more available skilled workers than jobs, employers take advantage of this and demand higher levels of education and experience, while offering lower pay. A third risk is that in simply following a trend, one is not really following their true passions and again, risks losing one’s identity and sense of joy and motivation.

However, perhaps a bigger issue is the impact of goal pursuits on motivation and well-being. Not all goals are created equal, and extrinsic goals (those based on materialistic gains such as salary, status, and power) tend to undermine both motivation and psychological well-being because they interfere with the fulfillment of psychological needs. As human beings, we all have innate psychological needs. When these needs are met, it promotes and sustains more self-determined forms of motivation, but also increases psychological well-being. However, when our psychological needs are thwarted, our motivation wanes, and our well-being is undermined. If a person places priority on pursuing extrinsic goals the psychological needs of autonomy, competence and relatedness are often sacrificed in the process. Long hours spent at the office often results in neglecting time with one’s spouse, children, or developing and maintaining close and caring relationships with others. Failed relationships undermine perceptions of competence, but also take a toll on one’s happiness and well-being. In addition, when people prioritize extrinsic goals they tend to gauge their success by comparing themselves with others. The problem with this is that you will always have the opportunity to find someone who is more successful, earns more money, or has more power than you do. The third need, autonomy, refers to the need for volition or choice. Marketers and the media have become very effective at convincing people that “success” and acceptance is found by owning material objects. This focus on materialism has been coined the “dark side of the American Dream,” by psychologists and researchers.

Changing Trends

Thus, following what seems to be the “hottest career” can backfire for several reasons. Trends change, and what is “hot” one day is “not” the next due to changing needs of society, politics, the economy, and advancing technology. Pursuing the “hottest career” is usually the result of seeking a career that offers a guarantee of a high paying job. The problem with placing too much emphasis on high salaried jobs is that it leads to focusing on extrinsic goals rather than intrinsic ones. Researchers have repeatedly shown that placing emphasis on extrinsic goals results in reduced levels of motivation over time, but also undermines psychological well-being. Furthermore, pursuing a career just because it has been deemed “hot” also increases the likelihood of chasing a career that you may not be well suited for. Over time, pursuing a field that doesn’t take advantage of your skills, interests, and passions, will result in burnout and/or reduced competence. It is much smarter to pursue a field that you really enjoy because you will find you have more energy and motivation to continue learning and investing the necessary time and energy to succeed. Select a career field that matches your skill levels, interests, and passions, and one that has a steady demand.

Sense of Identity

As mentioned earlier,  people often form their sense of identity, in part, through their careers. This is especially true for men, and therefore, a job loss can be earth shattering experience, rattling one to the core, as they struggle to retain a sense of self-worth and maintain a sense of identity. Thus, chasing a career based on the latest projected trends, risks pursuing careers that are not in alignment with one’s passions, skills, and interests, resulting in a further loss of self-identity.

For more information please visit the following website: Elaine Bontempi, Ph.D.

Friday, September 20, 2019

The Changing Face of Jobs and the Workforce: Interview with Elaine Bontempi, Ph.D.

We are very proud to offer another very valuable interview with Dr. Elaine Bontempi.  This is one of a series, which you can find this website  For more information, please visit:

What have you observed about job changes and job transitions in today's world?

The saying, “the only thing we can count on is change,” seems to hold very true to the application of today’s job market. There are several trends I think we have all noticed, ranging from industry closures, changing demographics, and the ways in which businesses are conducted (more and more are changing to an online environment).

Industry Changes
 In spite of claims of a strong economy, several industries are still struggling to pick up the pieces of the economic downturn. In addition, over the past decade technology has had a major impact on many industries. The “retail apocalypse” can be seen as many department stores and smaller boutiques have failed to compete with the convenience of online shopping. Higher Education has also taken a hard hit over the past 6 years or so. Several colleges closed their doors permanently, and others continue to struggle due to budget cuts and lower enrollments. As the cost of tuition continues to increase more people question the benefits of earning a college degree if it means graduating with a heavy student loan. Other colleges are attempting to keep up by expanding their online programs, but as Mega Universities such as Grand Canyon, Western Governors, SNHU and Liberty increase their degree options, smaller colleges can’t keep up. The oil and gas industry is also struggling to regain its footing and many geologists, landmen, and others in the industry are still seeking work after experiencing mass layoffs, company closures and bankruptcies.

Changing Demographics
Other changes I see include increasingly multicultural and multigenerational workplaces. For perhaps the first time in history, we are seeing sometimes five generations represented in the workplace. Each generation comes with unique strengths and challenges for corporations. For example, Baby Boomers are starting to retire and so we are beginning to see an exodus as many have been forced into early retirement, others are facing health challenges, and some are staying in the workforce. One of the challenges of a multigenerational workplace is recruitment and retention. For example, compared to earlier generations who expected to work for the same company for a lifetime, this option is most likely not going to be an option in today’s industry. And, because Millennials and many of the Gen Xers are place higher value on flexibility and autonomy in the workplace, not only will lifetime jobs not be available, they may not be appealing to many people in younger generations. Therefore, it may be more difficult to recruit and retain these generations if the workplace doesn’t offer flexibility or opportunities for growth. Many corporations are clinging to the outdated factory model, with cubicle workspaces and hours of operation from 8-5. This simply doesn’t work in a technologically advanced society where more people place value in a work/life balance, prefer flexibility and opportunities to work from home.

Other changes I see include technological advancements which not only change required skills, but also the ways in which people work and communicate with one another. Cloud based technology, AI, rapidly changing software programs, and internet based businesses are just a few of the ways in which technology is influencing workplace changes.

What makes today different for people in the workforce than even 5 or 10 years ago?

This seems to be somewhat of a follow up to the first question, but in terms of general social trends, the demand for digital skills has increased considerably over the past 10 years, but the workforce is also becomingly increasingly diverse in culture, level of education, race/ethnicity, gender, age, religion, sexual preference and identification, and ability. For example, this is the first time we have seen up to five generations in the workplace. Traditionalists (i.e., those born before 1946) are not as likely to be in the workplace but may be the CEO’s running the company. Baby Boomers (born between 1946-1964) are usually in upper management or CEO positions, or exiting the workplace as many are eyeing retirement. Gen X (1965-1976), Millennials (1977-1997) and Gen Z (born after 1997) may all be represented in a workplace. People form their values based on experiences, and because each generation, as well as every individual, has witnessed different things, you see different values emerge. Those who experienced the Great Depression craved stability, and these values were passed down in part, to Baby Boomers who often had the same career for a lifetime. War, economic crashes, technological advances, immigration and migration, etc. all impact people at both a generational and individual level. Although you don’t want to make stereotypes towards any generation, some general differences in communication preferences, work values, or familiarity with technology may emerge.

Thus, the challenges for managers and leaders will be many, including communicating with people from various generations and cultural backgrounds, but also recruiting, motivating and retaining employees. Companies will need to consider the increasing desire for autonomy and flexibility that began with Gen X and has continued with Gen Y workers. Other perks such as having workplace daycare, company gyms, the option of working from home, or even bringing emotional support pets to work are emerging trends. We are also seeing an expanding role of AI which will ultimately replace many jobs.

How can this job / career market have an effect on an individual?

Growth and Cutbacks
From my perspective the career market can impact people on several different levels, depending on one’s field, the organizational culture, and benefits offered to an individual. In terms of the career market, some fields such as IT and healthcare are growing. Aging Baby Boomers are driving up the need for healthcare workers, so you see many opportunities for home health workers, nurses, and PA’s. Other areas such as the oil and gas industry are trying to make a comeback but are fighting a political battle as attitudes about fossil fuels are changing. Thus, while there are plenty of opportunities in some fields, others continue to be very competitive.

Other ways in which the job market may impact an individual is the volatility seen in certain fields. For example, both higher education and the oil and gas industry are still feeling the ripple effect of economic down turns. Layoffs, forced retirements, fewer opportunities with higher competition, lower salaries, increasing demands for experience, education, and tech skills, and an increase in short term opportunities are common. Fewer universities, for example, are offering to pay for travel expenses or relocation. In states that are experiencing major cuts in funding, higher education is projected to experience more cutbacks, layoffs, and closures.  All of these things undermine a sense of autonomy and competence, reducing motivation and well-being.

A volatile economy often results in a reluctance to fully commit to an organization, low morale, and higher levels of stress. Employees may be “straddling the fence” so to speak, with one foot in their workplace and the other in the job market as they actively seek better employment opportunities. As a result, this makes it harder for employers to recruit and retain employees. This costs an organization money in the long run, as high employee turnover forces a corporation to invest more money in advertising and training new employees. In addition, organizations often get a bad reputation for having high turnover or failing to invest in their employees, adding to the difficulty in recruiting and retaining employees.

Increasing Diversity
Changing demographics are increasing diversity in the workplace. This means that those organizations that do not celebrate diversity and promote inclusion will see higher attrition, lower performance, and problems recruiting and retaining employees. If an individual feels discriminated against due to their race/ethnicity, gender, sexual identity, age, religion, or ability, they are much less likely to apply for a job with that particular company, or remain in workplace that is seen as hostile. And, although there are laws in place that make discrimination and sexual harassment illegal, they tend to thrive in workplace today, often disguised as subtle racism or sexism, limited opportunities for growth and advancement, or workplace bullying.

Changing times mean changing needs, therefore individuals tend to be seeking different benefits from a job today than a generation or two ago. For example, while Traditionalists and Baby Boomers sought jobs that offered lifetime stability, different values are often witnessed in younger generations.  Companies who cannot keep up with the demands of younger generations will struggle to recruit or retain employees. For example, companies offering the flexibility of working from home are going to be increasingly appealing to many people, especially those who value flexibility, make long commutes to and from work, have children at home, face health issues, or feel more productive when they are at home away from the distractions of the workplace. Over time, factors such as a long commute, or the cost of daycare can prove to be deal breakers for many individuals. A cost-benefits analysis may reveal that costs associated with either commuting or paying for daycare may make the job much less appealing. Thus, employers who provide more flexibility are likely to also see increases in employee morale, motivation and commitment to the organization. Because more jobs allow for working from home in an online environment, companies who provide opportunities to network through webinars, email, facetime, training, etc. will foster competence and satisfy the need for relatedness. However, as more people continue working remotely, many companies are failing to build social relationships in the workplace, which can lead to a sense of isolation and disconnection.

For more information please visit the following website: Elaine Bontempi, Ph.D.

Wednesday, September 11, 2019

Transforming Stress, Unexpected Change and Uncertainty into New Opportunities: Interview with Elaine Bontempi, Ph.D.

The ever-increasing pace of change, combined with new displacing and disruptive technologies that involve digitalization, robotics, widescale automation and more, is requiring everyone to rethink how they live their lives and how they earn a living. In all cases, individuals may feel under pressure, out of control, and fearful.

Welcome to an interview with Dr. Elaine Bontempi, who talks to us today about transforming a stressful situation into one that builds confidence and open doors.  She talks about the psychological and physical costs of doing nothing, and the benefits of developing a plan and a new philosophy. 

1.  What is your name and your background?

Elaine Bontempi, Ph.D.
My name is Elaine Bontempi and I have the following background. My website is here:

Ph.D.: Educational Psychology
Focus: The role of culture in motivation & learning

M.Ed.: Educational Psychology
Focus: The role of culture in motivation & learning

M.A.: Human Relations
Focus: Multicultural Counseling

B.A.: Health Psychology
Minor in Sociology (Contemporary Social Issues)

•    Over 15 years of experience teaching graduate & undergraduate courses in Psychology, Human Motivation in Learning, Human Motivation in Work & Leadership, Human Learning, Cultural Diversity, Leadership, Contemporary Social Problems, Social Psychology, & Ethics

•    Over 10 years of experience designing, implementing & evaluating educational outreach and training programs for non-profits, Dept. of Education, government institutions and businesses

•    Academic & Life Coaching

2.  What are your areas of expertise, and how did you get interested in them?

My areas of expertise are in Psychology, but in particular, Motivation, Health, & Well-Being.

•    Motivation & psychological well being
•    The role of goals and psychological well-being (not all goals are created equally, and although society really pushes some goals, the pursuit and attainment of certain types of goals actually undermines well-being).
•    Motivation in the workplace
•    At risk teens
•    Eating disorders
•    Overcoming anxiety without medication
•    Stress management
•    Coping with aging and/or terminally ill parents
•    Grief & loss
•    Spirituality and well being

How did I become interested in these topics? I would say that I have always been interested in what makes people tick, so to speak, as well as health, and general well-being. Growing up as an athlete, you learn the importance of goal setting, self-regulation, and motivation. However, these are limited tools because as we grow older, we encounter challenges and life transitions, and many of these are quite uncomfortable as we are stretched outside of our comfort zones. Of course many of these transitions are inevitable and are part of the maturation process. However, even anticipated mile markers can act as barriers to our growth and self-actualization if we lack a healthy mindset, coping skills, and self-regulatory strategies

3.  How do people manage change today? What are some of the negative ways that people cope with change? What are better ways?

Photo by Humphrey Muleba from Pexels

The ways in which people handle stress vary considerably from one person to the next. Each person has a unique set of experiences, coping mechanisms, abilities, and values that all contribute to how one handles stress. In addition to individual differences there are some general group differences that can be seen as well, as a result of cultural norms and gender socialization. 

Some of the negative ways that people cope with change and stress include smoking, drug use/abuse, alcohol use/abuse, compulsive spending, over or under eating, eating unhealthy "comfort" and junk foods, excessive use of sugar and caffeine, sleeping too much or too little, sexual promiscuity, overworking, lashing out at others, and violence.

However, there are definitely healthier ways of handling stress. The first step is identifying the sources of stress in your life, as well as your attributional style. Do you have a tendency to place the blame for your stress on others, do you feel that you have no control over your circumstances, or do you recognize that although you may not be able to control events, you can control your reactions?

There are different approaches to changing the stressful situation--you can either avoid the stressor, or sometimes you can alter the stressor. For example, you can often times avoid a stressor by simply learning how to say "no." Often times, we feel compelled to say "yes" to everything in order to please others, or to avoid looking incompetent or lazy. It is imperative that you learn to recognize your limits and say no to things that will result in too much stress.

If you are unable to avoid a stressor, you may choose to alter the situation. An example of altering the situation might include expressing your feeling in a different manner. For example, rather than bottling up emotions and letting them fester and brew, find a friend or counselor that you can talk to. Or, it may mean changing how you express your emotions, or even regulating your time so that you are less likely to feel stressed out from having too much responsibility and not enough time to accomplish the things you have committed to.

You can also learn to adapt by using healthy stress management techniques, and/or accept the stressor.  Adapting to the situation often means learning how to use emotional regulation strategies for healthier coping, which often times involves changing your interpretation of the event that you perceive as being stressful. Is the stressor really that important or are you putting too much emphasis on something that really, in the long run, doesn't mean much? The old saying, "learn how to pick your battles" may apply here.

 Sometimes you simply have to accept things that you cannot change but find work arounds. Focus on the things you CAN change rather than getting upset about things you cannot control. For example, if you are responsible for the caregiving of a sick child or aging parent, you probably won't be able to change or avoid the stressor. However, you can change your reaction. You will need to accept that your child or parent is ill and needs help, and re-arrange your schedule in order to meet these demands. If you are still responsible for other obligations then it may be necessary to adapt to the stressor by seeking outside help to assist in caregiving, recognize that you as a caregiver, also need to maintain a healthy lifestyle, learn to manage time more efficiently, and never overlook the importance of self-care.

Some of the healthier ways in which people handle stress include:
•    social support networks including family and friends
•    support groups, spirituality and prayer/meditation
•    learning the art of forgiveness
•    spending time in nature
•    getting regular exercise (cardiovascular exercise in particular)
•    eating properly and getting plenty of sleep
•    applying biofeedback
•    practicing yoga
•    spending time with pets
•    writing in your journal
•    working outside in the garden
•    painting/sculpting/drawing
•    dancing
•    playing a musical instrument
•    scheduling time for self-care such as massage/Reiki/ acupuncture
•    practicing mindfulness
•    learning time management
•    accepting there are things you cannot control
•    embracing a positive attitude
•    avoiding too much caffeine
•    avoiding abuse of alcohol, drugs or nicotine
•    seeking counseling, etc.

Certain counseling techniques such as cognitive evaluative therapy might be helpful in thought stopping behaviors and replacing negative thinking with positive thoughts. Behavioral therapy can also helpful in reinforcing positive behaviors and extinguishing negative ones. Exercise can play a very important role in improving anxiety and depression. Especially something as simple as walking daily. Exercise increases the production and release of serotonin and dopamine, both neurotransmitters play an important role in maintaining a healthy and positive mood.

3.  What are some of the major stressors in our world today and how do they change over one's lifespan?

Photo by Oladimeji Ajegbile from Pexels

We are facing many stressors in the world today. It seems like our world is shifting so rapidly that people are struggling to keep up with the transitions, and as a result sometimes it seems that the world has gone mad. Climate changes that are causing major shifts in weather patterns, mass immigration and migration, racism, economic uncertainty resulting in layoffs, downsizing, closures and job loss, global migration, political polarization, mass shootings, etc. are just a few of the global stressors.  We are also seeing alarming trends concerning the use of social media and depression/anxiety/suicide. A sociological phenomenon known as “upward social comparison” is wreaking havoc on peoples’ self-worth and self-esteem, as they are comparing themselves to the lives of others represented through reality television and social media. Even though these profiles are considerably altered through selective use of highly edited photos, and the “highlight” reels of one’s life, people are often left feeling deflated and dissatisfied with their own lives when comparing them to the self-marketed profiles of others in Facebook and other social media platforms.

Other stressors are small, daily things such as dealing with traffic and long commutes, office politics, paying bills, screaming children, juggling obligations between work, family, and/or school, etc. These types of stressors don't tend to score big on the "life stressors" chart, but major transitions in life, even if they are perceived as positive, can take a larger toll and undermine well-being.

Major transitions in life include events such as graduation, marriage, birth of a child, changes in career (new job or loss of job), relocation, divorce, empty nest, changes in health, loss of a loved one, natural disasters, war, unhealthy relationships, aging parents, etc. Studies have repeatedly shown that as people grow older, their health declines more rapidly if they do not have a social support system. This is a growing problem as people are living longer, but often more isolated lives. Adult children are often scattered across the globe as job opportunities take them away from the same town as their parents. This is especially common in individualistic cultures such as the United States and western European cultures, that place value on independence and competition rather than on community and harmonious interdependence.  Nursing homes and assisted living centers in the US are filled with aging, forgotten parents.

4.  What are some of the stresses related to taking care with aging parents or relatives?

Photo by Matthias Zomer from Pexels

 Taking care of aging parents or relatives can be a particularly stressful job, as it can leaves one feeling physically and emotionally drained. As parents get older, their physical limitations decrease, thus their need for support increases. Their needs are multi-pronged and may include financial costs associated with healthcare and nutrition, mobility needs (ie, a parent may go from using a cane to a walker, to a wheelchair, and ultimately being bedridden), etc. As their needs increase, the demands placed on the caregiver also rise. Seeing a parent who was once vital and independent regress to a state of dependence can be difficult to watch, and it tends to cause a shifting in the dynamics of the relationship as roles are reversed.

This can seriously tax the physical and emotional reserves of anyone caring for an elderly parent, but when personality changes associated with aging and dementia are also present, it can especially stressful. It may also be particularly stressful on the caregiver if they are trying to juggle their own responsibilities of work, family/relationships, health, etc. In most cases it leaves the person responsible for caregiving feeling emotionally and physically drained, thus one of the most important things for any caregiver to remember is the importance of self-care. If the caregiver overlooks this it can quickly erode both the physical and emotional health of the caregiver. Thus, relying on some of the above mentioned strategies for stress management are imperative. Getting proper nutrition, plenty of sleep and exercise, spending time in prayer/meditation, having a strong support system of one’s own, and learning how to say “no” to increasing demands by sharing the responsibility with other family members or hiring help are very important.

5.  What are support networks?  What happens when people lose their support networks?

PHOTO CREDITS Photo by Tristan Le from Pexels

Support networks refer to the psychological and physical support provided by a social network. Social networks can include close friends and family members, tribal members, social activity/group such as a book club, community support groups, or even a religious community. Social support networks can provide a variety of resources ranging from emotional support, financial assistance, prayer, or help with daily tasks. Those who have high quality or quantity social networks tend to show decreased depression, anxiety, loneliness, drug/alcohol use, and a lower risk of mortality in comparison to those who have low quantity or quality of relationships.

Poor social support has been also linked to cardiovascular disease, lowered immune system, and altered brain function. Although there are individual and group differences, women often have closer support networks due to the differences in how men and women are socialized. While gender roles are changing, women are still more likely to be socialized as nurturers and caregivers, and playing support roles rather than placing emphasis on competition and independence. As a result, women’s health tends to benefit as they grow older as they are much more likely to have a social network for support. Men tend to rely on spouses and children, but if neither are around as they grow older, they are much more vulnerable to the ill effects of having a limited support network.

Wednesday, September 04, 2019

Argentina: Overcoming Debt Challenges and Rebuilding with Infrastructure and Innovation

Of all the countries in the world, perhaps no country more embodies “debt trap” and then “default on sovereign debt” than Argentina. Argentina’s national banks defaulted on their first loan only a few years after independence from Spain in the 1820s when the Minister of Finance obtained loans to pay off war debts. The loans were considered usurious, and the ensuing crisis resulted in a 33 percent devaluation in 1827, and then 68 percent in 1829 (Argentina Country Risk Report, 2019). Unfortunately, these were not to be the only loans that quickly became unmanageable due to high interest rate and impossible terms, and which deeply damaged the Argentine economy.

Later, however, the time from 1850 to 1930 was very prosperous for Argentina, which, thanks to its prosperous agricultural sector, and the infusions of investment capital into infrastructure (railways) and industries. At one point, Argentina was the seventh largest economy in the world, and its inhabitants were the 10th wealthiest.  In addition, the country benefited from being perceived as a safe haven for money and resources fleeing war-torn and newly communist countries in the world.

However, there was a slowdown in the 1930s, inspiring in 1943 a coup d’etat by Juan Perón, whose goal was the empowerment of the poor and working class. Argentina was not invited to the 1944 Bretton Woods conference that established the International Monetary Fund and the World Bank because Argentina had not yet joined the Allies in World War II. In fact, Perón was against joining the group and considered the effort "imperialistic.” Perón was overthrown in a rival coup in 1945. In 1946, he was narrowly elected President. His government was accused of repression.

Argentina finally officially joined the International Monetary Fund in 1956. In the meantime, the Argentine government continued its idealistic utopian socialist transformation through modernization approach which so typified the first half of the century in rebuilding nations. There was an emphasis on large infrastructure projects and in state-owned industries that employed many thousands of people in the administration of the nationally owned utilities and social services.  The ensuing deficits led to a need for liquidity, and then the first waves of large loans. Waves of economic problems were accompanied by protests and activism, resulting in repressive governments.

Source: Wikipedia.

Economic Decline: In such a situation, economic growth was difficult if not impossible. Between 1975 and 1990 real gross domestic product feel by almost 20 percent, which had a very negative effect on the entire country, but most pronouncedly on manufacturing, which entered into continuous decline in the 1970s. The government attempted to level the playing field by creating a wall of tariffs and by instituting protectionist policies. Instead of incubating the domestic companies, the result was a lack of investment, a loss of competitiveness, and finally a loss of markets.  Argentina, which was once known for the high quality of its manufactured goods, began to shutter factories as they could no longer stay open, even when heavily subsidized.

Almost every decade has been marked by a dramatic economic crisis, often marked by devaluation, hyperinflation, a default in national debt, with corresponding erosion of credit-worthiness.
As of September 2019, Argentina's external debt stood at around $101 billion (The Times, 2019). The currency has been devalued again, resulting in an exchange rate of $US 1 to 56 Argentine pesos, from 25 to one US dollar a little over a year before.

What is it like to try to have a business in Argentina during times of devaluation of the currency? What is the impact on the supply chain? 

Argentina has a history of high external debt, and it has been borrowing for infrastructure projects and also to service existing debt.  According to many analysts, Argentina "is almost certain to default on its $100 billion of debt again" (Aldrick, Sept 3, 2019, The Times). South America's second largest economy has been in trouble financially many times since it joined the IMF in 1956.

Specifically, Argentina has been bailed out an astonishing 22 times since 1958 and has defaulted on its  loans nine times since independence in 1816. Slow or reduced payments to investors have been “de rigor” since the 1960s until even September 2019 when the maturity on short-term government loans was extended without negotiation (Sanders 2019).

President Macri's initial strategy involved having Argentina reenter global markets, pay off "vulture funds," and ask the IMF to audit funds (with the idea of more loans).  He also tried to balance the budget by increasing the amount paid to the government for services (utilities, etc.), and to restrict the flow of capital out of the country. The resulting devaluations made Mr. Macri extremely unpopular, and his loss in the primary elections further weakened confidence in a challenged economy.  The goal in early September 2019 was to refinance the debt. However, the country remains deeply divided between Macri's reformist party and the socialist / populist party (Kirchner, etc.) which has been accused of corruption and mismanagement (Argentina Country Risk Report, 2019).

What happens when the IMF requires the country to service its debt?  Usually there is an austerity plan with the goal of a balanced budget (prioritizing paying off debt). However, IMF austerity plans in Argentina have an unhappy history.  What has happened in Argentina is a devaluation of the peso, lack of buying power, poverty, lack of capital investment, and labor insecurity.  The country falls to an even lower level of productivity, due to uncompetitive products, falling productive capacity, obsolete and inefficient factories, lower level of human capital (due to lower social and education services (Mariza, 2019)), falling levels of confidence, and widespread financial institutional instability. But, faced with few options, the country tends to accept "loans of last resort" in order to service debt and avoid wholesale seizure of assets (Koch & Perreault, 2019).

Infrastructure Leveraged for Economic Growth:  Investing in infrastructure and marketing support for innovative products offers an alternative.  First, productivity must improve in the short run. There are a few ways to do so, which include conducting bid rounds in order to develop mineral and petroleum resources.

While it can be argued that the country often receives insufficient proceeds for licensing multinational companies to develop mines and oil fields, this is often the best approach in the short run. Indeed, this is an approach that Argentina has used, with success.  They have attracted investment in the Vaca Muerta shales, and five separate provinces are currently seeking investment in order to develop their oil and gas. In a recent international oil and gas congress (AAPG's International Conference and Exposition), executives from ExxonMobil, Equinor, Shell, and others were unified in their message that they were increasing their investment in Argentina and would continue to do so if the government could assure positive conditions. They also suggested maintaining Argentina's policy of maintaining a posted minimum price of $75 per barrel of oil, which de-risks the investment a great deal.

Second, boosting agricultural production in order to increase exports and facilitate import substitution is a possible strategy. However, years of neglect in the infrastructure have made transportation, processing, and warehousing difficult (Berlinski, 2019). Supply chain coordination is lacking, and so the fail-safes and protections that could be implemented to help de-risk the enterprise and protect against extreme weather, harsh conditions, and the need to store and hedge, are not possible.

A third strategy has to do with creating a global platform for Argentine innovation. The "Silicon Pampas" can develop new products to license, including such innovations as new systems for intelligent oil and gas operations. In fact, Yacimientos Petroliferos Fiscales (YPF) has created a spin-off company, YPF Tecnología (, which invests in start-up and mid-development products. New technology and innovations include innovative pumps, control systems, smart operations systems, and more. Intellectual property has been protected by means of patents. In addition to technologies used in drilling, completing and producing oil and gas, Y-TEC has developed alternative energy solutions, new process for processing and purifying contaminated water, and new approaches for developing monitoring systems using satellite and remote sensing for better management of the arid, fragile environment where many of Argentina’s oil and minerals are found.

The strategy is not without its own difficulties. Devaluation and inflation, along with protectionist policies regarding imports (extremely high duties) make it difficult to import the raw materials and equipment needed for the startups, and it becomes necessary to obtain painfully complicated licenses and exceptions.

Loans for Infrastructure:  Many of Argentina's loans have been for infrastructure, and in fact the so-called "vulture loans" (ones where the loaning entity refused to renegotiate or restructure, thus requiring Argentina to repay the entire principle and interest, often at a high rate of interest), have been for infrastructure. 

Unfortunately, there has been a long history of problems with loans for infrastructure projects; first, the interest rates can be very high, and second, there can be cost over-runs and excesses; third, additional affiliated fees, permits, and licenses can slow development.  The World Bank currently has a number of infrastructure projects in Argentina on the books:

Selected Examples of 
World Bank Projects and 
Operations for Argentina   
                                                                 Total Cost           World Bank Commitment   Approved
Northwestern Road Development
Corridor Project                                       $US 311.00 million      US$ 300.00 million    2017

Metropolitan Buenos Aires Urban
Transformation                                        $US 125.00 million      $US 100.00 million    2019

Salado Integrated River Basin
 Management Support Project                 $US 375.00 million     $US 300.00 million    2017

Argentina Renewable Energy
for Rural Areas Project                             $US 240.09 million    $US 200.00 million    2015

Matanza-Riachuelo Basin Sustainable
Development Project (Sewers in BA)        $US 1000.00 million    $US 840.00 million    2009

Urban Transport in Metropolitan Areas     $US 187.60 million    $US 150.00 million    2009

Argentina First Inclusive Growth
Development Policy Financing                 $US 500.00 million    $US 500.00 million    2018
(The World Bank, 2019.           

Challenges:  It is very difficult to keep politics out of economic development, and so some of the investments may be more politically expedient than truly productive in terms of economic development.

An often failed strategy has been privatization of the long-condemned as inefficient, state-run monopolies (utilities, etc.).  However, while privatization did have the effect of reducing the country's overhead, many of the state-run monopolies eventually can run the risk of becoming de facto private monopolies (or oligopolies).

Laws designed to protect workers are sometimes circumvented because they carry with them high taxes and severe penalties for letting a person from their job. As a result, an underground labor market has begun to supplant the formal labor supply. Much work is done off the books and consists of short-term employment. Not only do the employees not receive the benefits of a regular employee, they have no assurance of regular employment, and the pay tends to be much lower.

Recovery Plan: A recovery plan can leverage infrastructure projects and combine them with innovation (new technologies and communication), supply chain improvements, and productive linkages with local and international markets.

Now that there are certain sectors of the population that are facing food insecurity, and there are serious issues of hunger, an economic recovery plan will need to incorporate provision of nutrition and basic health coverage for the vulnerable (children and elderly), as well as nutritious meals for the workers.

A recovery plan should include the following items:
1.  Improved infrastructure, beginning with roads and sustainable electricity.
2.  Coordination between production (agriculture and extractive) and needed infrastructure.
3.  Targeted innovation and new technology developing in conjunction with infrastructure and production (agriculture, smart operations, mining, oil and gas, medicine, tourism, pharmaceuticals, marketing).
4.  Collaboration and partnering with global marketing networks for developing short-term and long-term markets for products and services.
5.  Private-Public Partnerships to help develop infrastructure, but in a way that protects workers and markets, and generates local employment (avoid importing all the workers, etc.).
6.  Restabilization of the financial sector, in order to attract investment as a "safe haven" investment, which may need development of cryptocurrencies.
7.  Innovation in supply chain operations, and the use of blockchain for assuring integrity, source, supply.
8.  Leverage the geographical position of the Tierra del Fuego, etc. to develop high-tech surveillance, monitoring, and strategic operations, in conjunction with allies.

Once the key elements of a recovery plan have been identified, steps can be taken to build out a critical path and a workflow. Using as many new techniques from supply chain management and risk management can be quite helpful.  In addition, it is useful to develop probabilistic models that can help one simulate the outcomes of different scenarios and then develop plans. 

£83 billion towering debt pile crippling Argentina’s economy. (2019, August 31). Daily Mail, p. 105. Retrieved from

Argentina Country Risk Report. (2019). Argentina Country Risk Report (pp. 1–59). Retrieved from

Berlinski, N. (March 19, 2019). Roads to prosperity. Fixing Argentina's crooked architecture. Prosper: Notes on the Future of Development from CSIS.

Country Reports - Argentina. (2019). Argentina Country Monitor (pp. 1–59). Retrieved from

Koch, N., & Perreault, T. (2019). Resource nationalism. Progress in Human Geography, 43(4), 611–631.

Mariza, Nazla. (August 19, 2019). The future of low-skilled manufacturing labor in Industry 4.0. Prosper: Notes on the Future of Development from CSIS.

Mexico Infrastructure Report. (2019). Mexico Infrastructure Report, (3), 1–60. Retrieved from

Sanders, P. (2019). Argentina Seeks to Extend Debt Maturities as Reserves Tumble. Bloomberg.Com, N.PAG. Retrieved from

The World Bank (2019) World Bank project. The World Bank, 2019.

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