How Stress Affects Performance at Work

What the research tells us about chronic stress and professional functioning

A software developer misses a deadline she would normally have met easily. A senior manager snaps at a colleague over something trivial. A registrar cannot remember the steps of a procedure she has performed a hundred times. Across all three, experience and skill are unchanged. Sustained and unrecovered stress has eroded the neural systems that support judgement, memory, and emotional regulation, and the effects show up in how people work.

The research on how stress affects performance at work is clear on one point. Short bursts of pressure can sharpen focus and drive effort. Sustained pressure without adequate recovery does something different. It wears down the same systems that people rely on to perform well, and those effects accumulate in ways that are both biological and behavioural.

The physical toll

When the brain registers a threat, whether that threat is a predator or a performance review, the hypothalamic-pituitary-adrenal axis releases cortisol and adrenaline to prepare the body for action (McEwen, 2007). In acute situations the response resolves and the body returns to baseline. In chronic stress the system stays activated. Cortisol remains elevated, recovery does not occur, and the cumulative biological cost of that sustained activation is what researchers describe as allostatic load (McEwen, 2007).

The downstream effects include disrupted sleep, weakened immune function, cardiovascular strain, and persistent fatigue. Each has a direct consequence for work. Poor sleep degrades attention, decision-making, and the overnight consolidation of memory, which means information learned during the day does not anchor properly (Walker, 2017). Reduced immune function increases sick days. Fatigue slows cognitive processing and increases error rates in detail-dependent work.

The cognitive and emotional toll

Chronic stress also affects the brain directly. Prolonged cortisol exposure suppresses activity in the prefrontal cortex, the region responsible for executive function, planning, and impulse control, while strengthening the amygdala’s response to perceived threat (Arnsten, 2009). This neural shift explains why people under chronic stress often describe feeling less sharp, more reactive, and less able to hold complex information in mind.

In clinical work the presentation is recognisable. Working memory shrinks. Small problems feel disproportionately large. Irritability rises. Initiative falls. The capacity to plan across time horizons longer than a few hours starts to erode. People who have always managed complexity begin to describe themselves as unable to think straight. These effects are predictable consequences of what chronic stress does to the brain, and they are reversible once the underlying stress is addressed and recovery conditions are restored.

The ripple through workplace performance

When cognition and emotional regulation degrade, work output follows. Safe Work Australia data consistently show that mental health conditions are among the leading causes of long-duration workers’ compensation claims, and these claims have been rising faster than physical injury claims over the past decade (Safe Work Australia, 2024). Beneath those statistics sits a quieter pattern. People continue to show up at work while cognitively depleted, producing less, making more mistakes, and exhausting the discretionary effort that high-functioning teams depend on. The visible signs, missed deadlines, resignations, and friction between colleagues, are the downstream manifestations of this slower erosion.

What helps address how stress affects performance

Addressing workplace stress requires attention at more than one level. At the individual level, recovery practices matter. Research on recovery from work consistently identifies psychological detachment, relaxation, mastery experiences, and a sense of control during non-work hours as protective factors (Sonnentag, 2018). Individual strategies have limits. If the demands of a role consistently exceed the resources available to meet them, recovery practices alone will not fix the underlying equation.

At the organisational level, the Model Code of Practice on Managing Psychosocial Hazards at Work (Safe Work Australia, 2022) identifies fourteen psychosocial hazards that employers have a legal duty to identify and control. These include high job demands, low job control, poor support, role conflict, workplace violence, and bullying. Where these hazards remain unmanaged, chronic stress is the expected outcome rather than an individual failing.

If sustained stress is affecting your work, and your workplace supports are either absent or insufficient, external psychological support can help. Behavioural Edge Psychology offers individual therapy for professionals experiencing workplace stress, burnout, and the mental health conditions that often accompany prolonged exposure to poorly managed psychosocial hazards. You can book an appointment at behavioural-edge-psychology.au4.cliniko.com/bookings or contact the practice on 03 8771 4315.

References

• Arnsten, A. F. T. (2009). Stress signalling pathways that impair prefrontal cortex structure and function. Nature Reviews Neuroscience, 10(6), 410 to 422.

• McEwen, B. S. (2007). Physiology and neurobiology of stress and adaptation, central role of the brain. Physiological Reviews, 87(3), 873 to 904.

• Safe Work Australia. (2022). Model Code of Practice, Managing psychosocial hazards at work. Canberra, Safe Work Australia.

• Safe Work Australia. (2024). Australian Workers’ Compensation Statistics 2022 to 2023. Canberra, Safe Work Australia.

• Sonnentag, S. (2018). The recovery paradox, portraying the complex interplay between job stressors, lack of recovery, and poor well-being. Research in Organizational Behavior, 38, 169 to 185.

• Walker, M. P. (2017). Why we sleep, the new science of sleep and dreams. New York, Scribner.

About the author

Dr Sarah Fischer is the Principal Psychologist and CEO of Behavioural Edge Psychology, with consulting rooms in Caulfield South and St Kilda. She holds a PhD in Psychology from Deakin University and is registered with AHPRA, endorsed in organisational psychology.

Her clinical work sits at the intersection of evidence-based practice, trauma-informed care, and neurodiversity-affirming assessment. Her published research spans psychological safety, organisational trauma, trust and leadership, and has appeared in the Australian Journal of Psychology, Frontiers in Psychology, and the Journal of Healthcare Leadership,.

To book an appointment, visit behavioural-edge-psychology.au4.cliniko.com/bookings or contact the practice on 03 8771 4315.

If you are in crisis, please contact Lifeline on 13 11 14 or 000 in an emergency.

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