Leaders are planning for a productive year and in order to do so, they must take into account what’s making headlines.
By Zee Johnson
New trends and concerns are always appearing in the workplace. The areas that called for laser focus and attention last year may not be as high on the priority list this year, and executives are gearing up their strategies to adjust with the times.
The following topics weigh heavy on employees and employers’ minds and are expected to greatly impact the workplace in 2023.
2022 ended with a not-so-good bang for many workers as thousands were laid off just as the economy began its downturn. Some of the world’s biggest companies underwent mass layoffs after an uptick in hiring during the pandemic essentially reversed itself. Understandably so, employees across industries are left pondering: “Am I safe?”
isolved’s Pause, Pivot or Plan: HR Trends of 2023 found that employees who are concerned about job security and a possible recession is only heightening those fears. In fact, one in four employees don’t feel secure in their current position.
James Norwood, isolved’s EVP and chief strategy officer, says this angst is at an all-time high. “Data shows employees are more anxious, burnt out, and financial security-driven than ever,” he says.
Kathy Gardner, VP of communications at Remote.co and FlexJobs, says stability is of utmost importance for employees today and the current economy is causing much anxiety around the topic. “Job security is a top concern for the majority of workers right now. In fact, 63% said they’re ‘extremely concerned’ or ‘somewhat concerned’ about their job security in the next three months,” she says.
But Norwood says HR is beyond capable of making employees feel safe in their positions. “To combat these concerns, HR departments of all sizes must evaluate what they can automate and gain efficiencies in, enhance what they can to improve employee experience, and extend the impact of their team.”
isolved’s report highlights additional ways for companies to ease employee concerns and therefore boost retention and engagement and solidify trust.
- Support worker relationships: Thirty-two percent of full-time employees say what they most like about their current job is their relationship with co-workers, more than benefits (17%) and their daily work (17%).
- Create career pathways: Fifty-nine percent of respondents believe their employers could do more to help with career advancement and 21% don’t think there’s room to grow within their company.
- Benchmark market value: Compensation should at minimum mirror market value. In fact, respondents said that competitive pay is the best way for employers to improve company culture.
- Make a better candidate experience: Nearly half of employers (46%) aren’t providing good candidate experience. Companies must create a favorable experience despite the need for speedy recruitment.
The Roller-coaster Economy
Recession talks have been swarming for months, and experts predict that there’s a 96% chance of one happening in the next year. Pair this with the current cost of living, and workers are coming to a crossroads.
Remote.co’s Work & Financial Wellness report revealed that current economic pressures are heavily impacting job seekers’ and professionals’ decision-making. In fact, a majority of workers (80%) say their salary isn’t keeping pace with inflation, and 92% say that inflation and a looming recession have affected their career and financial choices.
The survey found that nearly half of respondents (47%) cite inflation and recession concerns as having pushed them to find or to start looking for higher paying jobs. Additionally, 31% say they took on a side job or began freelancing; 45% have placed themselves on a tighter budget; and 23% say they’ve begun putting more money towards emergency savings.
And when asked if they’ve considered a career change, respondents said:
- “Yes, I am actively trying to change careers right now” (50%);
- “No, but I am considering trying to change careers” (21%);
- “No, because I already successfully changed careers” (12%); and
- “I already tried, and it didn’t work out” (3%).
While some workers are dusting off their resumes in search of higher pay, others don’t feel comfortable about job hopping in an unpredictable market. Instead, there’s a group of people who have employed alternate measures to see more of their money.
A Harris Poll from DailyPay revealed that 44% of Gen Z has decided to live with their parents as a result of inflation and the economic downturn—and 48% say they aren’t moving any time soon. The study found that the demographic is having a hard time staying financially stable and just 28% say they are able to pay all of their bills on time. This is compared to 56% of Americans who say they are able to do so.
But employees shouldn’t be left to figure out how to survive inflation alone. Companies must offer some kind of assistance and/or incentive.
Keep Financial‘s Effective Compensation Survey Report found that 86% of employees would take an extra cash bonus in exchange for time commitment at their company. And of the respondents who receive stock options or other equity, 76% say they would rather receive all or a portion of that equity as cash in exchange for a time commitment.
When asked how a cash bonus payment would be used, respondents said:
- pay off debt (44%);
- save for retirement (40%);
- start an emergency fund (28%); and
- save for a down payment on a home (21%).
Rob Frohwein, co-founder and CEO of Keep Financial, says cash bonuses have proven to be exceptionally effective for his clients and they don’t require companies to look for “new” money.
“Often, paying compensation in addition to existing salary is not necessary. Employers can simply enable their employees to take a portion of their annual compensation up front,” he says. “For example, if an employee earns $100,000 per year, the employer can enable the employee to take $20,000 of this salary at the start of the year, and the balance spread over the remainder of the year. This benefit could come with a minimum retention period of one year. Access to compensation in the form of a lump sum can enable an employee to make a down payment on a house, pay off some debt or invest this money.”
And for companies looking for non-monetary bonus options, Remote.co’s Gardner lists some alternate incentives. “Beyond bonuses, pay, and cost of living increases, companies should consider alternative benefits that can help workers now and long term,” she says. “For example, offering flexibility like remote work options or flexible scheduling can create better work-life balance and help alleviate some of the stress workers may be experiencing.”
The Emergence of Quiet Hiring
Quiet quitting caught much steam last year, and this year, another “quiet” trend is emerging—quiet hiring, or the act of businesses filling gaps without hiring new, full-time employees. In this case, existing employees are temporarily moved into other roles within the company.
A recent Monster survey found that 80% of workers have been “quiet-hired,” and 63% think that quiet hiring is a great opportunity for them to acquire new skills.
Jennifer Shewan, VP of People at Wonolo, attributes quiet hiring’s rise in popularity to companies being more careful with their spending. “The reason quiet hiring is currently gaining so much attention is due in large part to the pending recession, which is pushing employers to be more strategic with hiring amidst budget cuts,” she says. “By being strategic in headcount allocation, team development, the use of temporary workers, and individual bandwidth, companies are able to meet their immediate needs in a cost-effective, low-risk manner, while also investing in their employees’ growth and development.”
Quiet hiring has gotten the attention of many who are now wondering, could it be a long-term solution to years-long talent challenges. Only time will tell, but for now, it works.
“The [economy’s] volatility makes it difficult to forecast staffing needs accurately relative to projected company performance,” Shewan says. “Quiet hiring allows companies to gain cost savings measures by both growing internal employees without hiring additional full-time headcount and evaluating their current and future independent contractor needs.”
But leaders shouldn’t nimbly allocate roles before becoming cognizant of the potential burnout internal job hopping can incite. Forty-two percent of respondents in a Key Bank report said they are currently overwhelmed or experiencing burnout in their jobs, with Millennials and those younger reporting a higher rate of burnout at 53%. For quiet hiring to stick, leaders must ensure it isn’t counterproductive.
“While there are significant benefits to quiet hiring, it does run the risk of burning out employees if it is not done thoughtfully,” Shewan says. “Employers can try to ensure employees are not overworked by prioritizing and investing in employee programs. Where possible, investing in mental health support could be invaluable to both employees and organizations.”
She also says recognizing and rewarding employees with things like pay raises and promotions works too and urges companies that are mitigating costs to strike a healthy balance between cost savings and rewarding hard work.