Rising worker confidence still remains below pre-pandemic levels.
By Larry Basinait
While 2020 has ended, the COVID-19 pandemic that defined the year remained ever-present through the first quarter of 2021. The U.S. economy continued to improve gradually as the unemployment rate fell to 6% in March, reaching the lowest point since the start of the pandemic. Additionally, the Bureau of Labor Statistics reports that the number of people out of work due to the pandemic fell by almost 2 million people in March to 11.4 million. The rise of employment combined with two rounds of stimulus checks deployed to eligible Americans in the quarter helped bolster economic growth and job creation.
The HRO Today Worker Confidence Index (WCI) report, sponsored by Yoh, found that in the first quarter of 2021, the WCI increased by six points to 103.2 from the fourth quarter of 2020, though it remained 9.2 point lower than in the first quarter of 2020. Three of the four indices that make up the WCI increased over the fourth quarter of 2020, with the likelihood of a promotion index up the most—increasing by 12.2 points to 118.8. The index was the only one to rise since last year, up 4cpoints since the first quarter of 2020.
There are four components that comprise the overall index: possibility of involuntary job loss, likelihood of promotion, anticipation of a raise of at least 3%, and trust in company leadership.
Employees’ Trust in Company Leadership Remains Robust
Though trust in company leadership did decline in the fourth quarter of 2020, throughout most of the pandemic, the index remained relatively strong, as it was the only one to remain above 100 on a quarterly basis. The index rose by 5.8 points to 106.9 in the first quarter of 2021.
Workers Remain Insecure About Job Stability
The job security index was the only index to decline since last quarter, though by only 0.8 points, to 84.2. On a year-over-year basis, the index dropped by a stunning 14.1 points, the largest decrease of any indices. On a monthly basis, the index reached 90.9 in February, up 16.6 points from January and the highest the index had been since March of 2020.
Workers’ Belief in the Likelihood of Promotion Increased Substantially
The likelihood of a promotion index increased substantially in the first quarter, up 12.2 points from the last quarter of 2020 to 118.8, the largest increase of any index. With the increase, the index reached its highest level since the pandemic started and is the only index to fully recover. In March, the index reached 131.2, increasing a whooping 22.4 points from February, its highest point since January of 2020.
Workers Feel More Confident They Will Receive a Raise
The likelihood of a raise index increased to 102.9, an increase of 6.7 points from the fourth quarter of 2020 and the second largest increase of any index. On a monthly basis, the index jumped by nearly 16 points from 87.9 in December to 103.8 in January, though it did fall back somewhat by the end of quarter.
Worker Confidence Index by Month
In March 2021, the Worker Confidence Index increased to its highest point in the quarter as 916,000 jobs were created, the most since July 2020, according to Trading Economics. While the job security index edged down slightly for the quarter, in February, the index reached 90.9, its highest level since March of 2020. The only index that was higher in March 2021 than in March 2020, when the pandemic lockdowns begun, was the likelihood of a promotion Index, up 21.6 points.
Worker Confidence Index by Race
White employees’ confidence increased the most in the first quarter of 2021, up a significant 11.4 points, though it was also the lowest race index in the final quarter of 2020. Confidence among Black employees remained steady, up a slight 0.4 points, while confidence among Hispanics decreased by just over 5 points to 115.1.