Managers who acted flexibly during the recession are trusted more by their employees.
The Institute of Leadership & Management (ILM) revealed that employees have greater respect for bosses who introduced measures such as flexible working and budget cuts instead of opting for redundancies during the credit crunch.
Senior managers in organisations which responded to the recession with compulsory redundancies have seen a sharp drop of trust and could benefit from performance improvement consulting services.
Penny de Valk, ILM chief executive, said that it was important for managers to be readily available to employees during times of crisis as this will create a better working relationship with staff and improve productivity.
He said: "It is clear that the actions of senior managers are scrutinised to a far greater extent during times of crisis, and major cuts are often seen as the direct result of poor management - even when this might be beyond their control.
"To boost trust it is important for senior managers to increase their visibility and communicate effectively with staff."
ILM also discovered that female managers did better than men during the recession especially when it came to understanding employee roles and women bosses were also rated highly in terms of ability and integrity.
"In those organisations where impacts of the recession have been seen to be managed well, trust levels are significantly higher. Female chief executives in particular have fared well at driving trust during times of adversity," said Ms de Valk.
The study also found that trust in public sector senior managers is lower compared to the private sector and local and national government chief executives suffer from some of the lowest trust levels of any sector.
Trust levels in public sector managers could sink even lower as government budget cuts are expected to affect job security, pensions and salaries in the coming months.
Research by recruitment consultants Badenoch & Clark revealed that bosses need to improve their relationship with Generation Y employees, those aged between 16 and 24.
Associate director Guy Emmerson said that employers must create a culture of trust in order to retain staff and improve motivation and productivity within the workplace.
"As recruitment activity levels pick up, employers need to consider the strength of their relationship with employees across all levels of the business, or run the risk of staff voting with their feet," he added.
One third of Generation Y employees do not believe most or any of what they were told by their boss, according to Badenoch & Clark.