I have never seen morale change from normal, although I've heard rumors of people who have (rarely) seen it.
In fact, the crew seem to have very little to do with the performance of my boat at all. My boat dives the same and handles the same regardless of how high or low the "effectiveness" bar is in the relevant rooms. Maybe sonar and radar are effected, but I haven't seen any evidence. The only thing that is clearly effective is torpedo loading times.
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