Jobs with low decision latitude tend to be relatively unskilled. Employees under these conditions don't have the authority to make decisions about their work or work environment (including input about job location, flexibility of work time, the ability to telecommute, and so on). They have little opportunity to learn new skills and problem-solve on the job.
Jobs with high psychological demand typically have heavy workloads (too much to do) and not enough time to do the work, as well as the pressures, conflicts, and responsibilities of the job. Picture that "I Love Lucy" episode where Lucy and Ethel work at a conveyer belt trying (unsuccessfully) to pack chocolates into their boxes, even as the chocolates come down the belt at increasingly rapid rates.
Bottom line: High demands + little control = stress.
Not surprisingly, when workers who face high demands are given more control and/or reduced workloads, their stress is lower.
For years now, Dr. Robert Karasek and his colleagues at UMass, Lowell, have been researching job stress from a scientific perspective, attempting to determine what causes it. They've found two major variables that strongly correlate with a job being stressful:
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Decision latitude, or how much control workers have over their jobs
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Psychological demand, or the pressures of the job