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Evidence-Based Reviews

Economic anxiety: First aid for the recession’s casualties

Loss of job? Loss of home? Psychiatrists can help ease patients’ financial distress

Vol. 8, No. 5 / May 2009

Comment on this article

Mr. R, age 45, developed severe depression 4 years ago after his mother died. He had suffered previous major depressive episodes and was treated effiectively with fluoxetine for 15 years. This time he took a medical leave from his job as an engineer and received disability. After numerous medication trials and psychotherapy, his symptoms improved.

Mr. R is ready to think about returning to work, but he will need to refresh his skills and consider starting at a lower level than before. Headlines remind him daily about increasing unemployment and decreasing prospects of finding a job.

During his illness, Mr. R and his family depleted their savings and incurred substantial debt. His wife has not worked outside the home while caring for him and their 4 children. She is increasingly anxious and depressed. The couple argue often about money but share a common hope: that Mr. R will find a job in the next few months.

How is the recession affecting psychiatric practice? Christopher Palmer, MD, the psychiatrist who treated Mr. R, says, “We in psychiatry and psychology are well-equipped to help people who are unemployed, underemployed, and financially ruined. We do it all the time. The difference in this economy is that we’re going to be seeing a lot more people.”

Psychiatrists who read Current Psychiatry and were polled in March 2009 agree. Most were seeing an increase in patients experiencing psychological stress because of the recession, which by then had persisted 16 months. “All my patients are reporting increased stress as a result of the economic situation. The more successful my patient is, the more distress they seem to be feeling,” says a psychiatrist from Melbourne, FL.

This article on the psychological effects of the recession discusses the results of an online survey of Current Psychiatry readers, with analysis and recommendations from an interview with Dr. Palmer and colleagues Jeffrey Rediger, MD, MDiv, and Carol Kauffman, PhD, ABPP, PCC, from McLean Hospital, Belmont, MA, and the department of psychiatry, Harvard Medical School.

Carol Kauffman, PhD, ABPP, PCC, is director of the Institute of Coaching, McLean Hospital, Belmont, MA, and assistant clinical professor, department of psychiatry, Harvard Medical School. A veteran psychologist, she maintains an executive coaching practice in the United States and Europe.

Christopher Palmer, MD, is medical director of continuing medical education, McLean Hospital. His outpatient practice focuses on substance abuse, sleep disorders, mood and anxiety disorders, psychotic disorders, and individual and family psychotherapy.

Jeffrey Rediger, MD, MDiv, is medical director, adult psychiatric program, McLean Hospital SouthEast. He also is an instructor, department of psychiatry, Harvard Medical School and has a master of divinity degree. He publishes in the fields of medicine, psychiatry, and spirituality.

Survey results

Methods. Using an e-mail questionnaire (Box), Current Psychiatry contacted 45 Reader Reactors—clinical psychiatrists who provide feedback to our editorial staff about topics being considered for publication. The 15 readers who responded practice psychiatry in the Northeast (New York and New Jersey), the South (Florida and Georgia), the West (California, Washington, and Oregon), and the Midwest (Pennsylvania, Illinois, and Missouri).

Nine of 11 readers who answered all questions in the survey said they have seen an increase in patients describing psychological reactions to the effects of the economic recession. A reader from Red Bank, NJ, reported, “I see a pattern of issues: ‘I was just laid off.’ ‘I am afraid I will be laid off.’ ‘Others have been laid off, and I’m overwhelmed with their work as well as my own.’ ‘I was planning to retire in a couple years, but now I will have to work longer than I was planning.’” Two psychiatrists reported no increase in patients with economic worries—in a prison and a state hospital with geriatric patients with cognitive impairment.

Timeline. For some survey respondents, the increase in patients with economy-related problems emerged in mid-to-late 2008—particularly in October—but others report seeing symptoms sooner. A reader from Harrisburg, PA, said, “I’ve noticed this increase for the past 4 to 5 months (dramatic), but there has been a general increase for 1 to 2 years.”

These observations mirror the rise in unemployment in the 16 months since the recession officially began in December 2007. In March 2009, the U.S. Bureau of Labor Statistics reported a national unemployment rate of 8.5% (13.2 million unemployed), which was a 25-year high. That same month, employers eliminated 663,000 jobs, for a total of 5.1 million layoffs since the recession began. Two-thirds of all layoffs occurred between November 2008 and March 2009.1

Symptoms. Depression, anxiety, or both are the most common symptoms associated with patients’ financial difficulties, survey respondents say. Other symptoms include insomnia, hopelessness, helplessness, loss of trust, anger, bitterness, resentment, suicidal ideation or attempts, numbness, desires for retaliation, increased alcohol/drug use, fear of being unable to afford medications or of losing a job, paranoia, and marital problems. Readers’ comments include:

  • Augusta, GA: “Patients with depression and anxiety symptoms have increased in the emergency department.”
  • Portland, OR: “I see people giving up and planning to live on unemployment as long as possible.”
  • Fresno, CA: “Some married people are wishing they were single and did not have children.”
  • Red Bank, NJ: “Some who have adapted are doing well, often with a low-overhead business, meeting a specialty need, or entering into a business that meets an emerging need.”

Who is affected? Overall, readers estimated that 70% to 100% of affected patients had pre-existing psychiatric disorders, whereas 20% to 30% had not sought treatment in the past. “Individuals with preexisting problems are having considerable difficulty,” one psychiatrist said.

Similarly, Dr. Jeffrey Rediger, medical director of the adult psychiatric inpatient service at McLean SouthEast, Brockton, MA, told Current Psychiatry, “For some people who were functioning marginally before the recession, this stress has pushed them over the edge. But we’re also seeing a number of young to middle-aged adults who are seeking treatment and hospitalization for the first time.”


Reader Reactor survey: Psychological effects of the economic recession

The Current Psychiatry editorial staff conducted the survey reported in this article. The following questions were emailed to 45 Current Psychiatry Reader Reactors March 20, 2009. Fifteen responded by March 30 (response rate 33%).

Current Psychiatry is preparing an article on the psychological effects of the economic recession. We would like to know about the experiences of practicing psychiatrists. Would you please take a few minutes and answer the following questions?

  1. Are you seeing an increase in patients describing psychological reactions to the effects of the economic recession?
  2. If so, when did you notice this increase?
  3. What symptoms are you seeing in your patients?
  4. What event or events seem to be causing your patients the greatest psychological distress (loss of a job, worry about losing a job, mortgage foreclosure, loss of value in retirement savings, other)?
  5. What proportion of these patients has pre-existing psychiatric disorders versus persons who have not sought psychological/psychiatric treatment in the past?
  6. In what area of the country do you practice (city and state)?

Feel free to provide additional comments you may have.

Interview: Emerging patterns

When interviewed March 17, 2009, Dr. Rediger, Dr. Palmer, and Dr. Kauffman discussed their experiences, provided case examples, and suggested treatments they have found useful for recession-stressed psychiatric patients.

DR. PALMER: People went into panic mode in September/October. Losing a job, a retirement plan, or a home is about who we are and our worth as human beings. My sense is that most people are resilient and adaptive and will be fine despite the recession, but a portion of the population is impaired in adaptability.

DR. REDIGER: Would you explain what you mean?

DR. PALMER: A lot of people become so defiant, so angry, that they withdraw instead of adapting to a new way of life that they consider inferior. They’re humiliated; they feel complete and utter failure. For example, the contractor who owns his own business and says there’s no way he’s going to work for somebody else. He may have to go work for somebody else, get his personal finances in order for a year or two, and then start up a business again. But he has to survive in the meantime.

DR. REDIGER: People are walking around with a lot fear and self-blame. They don’t talk about this very easily; they may say things are fine, but they feel terrible. I wonder how much people are blaming themselves, perhaps for overextending their credit.

DR. PALMER: I think most of these people sensed their finances were marginal before the recession hit. They felt out of control, but their options were limited as housing prices rose beyond affordability. Clinically, I’m seeing increased rates of depression, anxiety, hopelessness. Denial is a big one; there’s a mindset that this can’t be happening.

Helplessness and dread

DR. KAUFFMAN: I resonate with the hopelessness. A lot of people tell me they are experiencing a sense of free fall, and I’ve been working with them to recalibrate a sense of empowerment. First I try some reality testing. I’ll say, “Maybe you’re feeling anxious, helpless, a little denial, fear. Is your survival in danger? Yes or no?” If the answer is no, then I’ll say, “So what can you do so you’re not living as if your survival is in danger?”

DR. REDIGER: Some people—such as the patient in the case report I submitted (Case Report 1)—are paralyzed by dread and anxiety. Two years ago their house was like an ATM machine, but now they feel trapped and worry that they can’t meet the mortgage payments.

DR. REDIGER: An economic recession is stressful because money represents power, control, and survival. The recession is not just about money. It’s about security, identity, and loss of face.

DR. KAUFFMAN: The evidence is pretty clear that financial losses are a risk factor for suicide, especially among men.2,3 You can go up and down Maslow’s hierarchy of needs and see what money means to people. I’ve also noticed that economic stress is a trigger for my clients with posttraumatic stress disorder. They feel out of control of a situation they thought they controlled.

DR. PALMER: An economic downturn can trigger learned helplessness. A construction worker has applied to 50 different construction companies, and none are hiring. He concludes, “I have to wait until the economy turns around, and then I’ll get another job in construction because that’s what I do.” He thinks he doesn’t have enough money or isn’t smart enough to get a degree, or whatever.

DR. REDIGER: And that’s another reason why someone with a history of trauma might experience a reactivation. Learned helplessness can be an aspect of chronic, repeated trauma. A person learns not to try any longer.

DR. PALMER: An inflexible perfectionist would probably have the most difficult time. A person who feels “there are rights and wrongs in the world, and the right thing is that I should be working. My family has grown accustomed to a certain lifestyle, and it’s my job to keep that up.”

DR. REDIGER: “If I work hard, this should be given to me.”

DR. PALMER: Right. A person with more flexibility might think in terms of problem-solving. “I worked in construction (or whatever), and now I can’t get a job. Therefore, I’ll go into a different field and take a lesser salary. The family will have to cut the budget, and the kids will go to a public college instead of a fancy private college.”

Case Report 1

Suicidal contractor ‘can’t imagine working for someone else’

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