Post-Covid America was projected to see a modern-day resurgence of the Roaring Twenties. However, in 2022, Americans are contending with inflation and talks of a recession, stagflation, layoffs, downsizing and war. The economic, geopolitical and macro events impact human resources and the job market, resulting in the following workplace trends.
Layoffs, Downsizing, Rescinded Job Offers
Since May, tech startups have laid off nearly 27,000 workers, according to layoffs.fyi. Tesla CEO Elon Musk, who said that he had a “super bad” feeling about the economy, said the electric car manufacturer would cut 10% of its workforce. Microsoft said in May that it would slow hiring in its software group. Meta also announced that month a hiring freeze for some teams. Coinbase rescinded a number of accepted offers. Gemini, the crypto exchange, founded by the Winklevoss twins, said a “crypto winter” is coming and downsized 10% of its staff. Crypto.com and BlockFi said they are laying off people as well.
Fintech unicorn Bolt announced it would lay off workers, as the tech bubble is slowly bursting. Klarna, a Sweden-based fintech company in the buy-now-pay-later space, announced plans to lay off about 10% of its global workforce, in a pre-recorded video message. Robinhood, Netflix, Peloton, Cameo, Noom, On Deck, Workrise and others have also announced layoffs or temporary freezes.
The Stickiness Of Remote Work
The first question job seekers will ask a recruiter is, “Is this a remote role?” If not, they say, “Thanks, but I’m not interested.” After two years of working remotely, a large segment of the workforce wants to continue working from home—or anywhere they want.
People cite the benefits of having a better work-life balance. They can enjoy all of the family milestone events that they’ve missed over the years, as they’ve been forced to commute back and forth to an office every day.
Management, reluctantly at times, acknowledges that remote work benefits the company too. Talent acquisition professionals can recruit top candidates from across the United States and around the world. In a tight job market, the ability to attract applicants from locations outside of commuting distances is seen as a great way to promote diversity in the workplace.
The Growing Clash Between Remote And In-Office Workers
It’s only natural that there will be a difference between those who go into an office and people who work remotely. Both sides start feeling that they are not being treated fairly.
Workers who commute have to wake up early and schlep into the city on crowded mass transit and need to worry about their physical safety in big cities, such as New York and San Francisco. The trek takes time and money and saps your energy. Meanwhile, the commuters complain that the remote personnel don’t even have to get out of bed to work.
Employees at home feel that they are forgotten about. They are afraid that their career will be hampered by being out of sight and out of mind. Managers may neglect to invite them to important Zoom or impromptu in-office meetings. They’ll miss out on all of the serendipitous encounters in the hallway, cafeteria and elevators. The folks working from home won’t be invited to lunches, drinks after work or concerts and sporting events in the city. They’ll likely feel like second-class citizens.
There is a fear of missing out (FOMO) for both groups. People who go into the office miss out on all their kids’ school plays, soccer matches, ballet classes and other memories that they’ll never get back.
Those who are at home start resenting the people in the office who benefit from proximity bias. It’s much easier to give plum assignments to the person who is always around the office.
If a pattern emerges that in-office workers receive higher salaries, raises, promotions and bonuses compared to their remote counterparts, there will be complaints made that they were favored due to proximity instead of hard work and output. The unrelenting conflicts could lead to disengagement and people quitting in the Great Resignation trend.
Management And Workers Are Not On The Same Page
There is an inherent disconnect between corporate leadership and rank-and-file workers. For example, big-shot executives at top-tier New York City-based investment banks, hedge funds and private equity firms have an advantage over their employees. Senior-level managers have luxurious offices, assistants and the clout to get things done.
This cohort possesses the financial means to live in Manhattan. They don’t have a clue of how arduous it is to commute five days a week from one of the five boroughs or the nearby suburbs of New Jersey and Connecticut. The wealthy elite can easily pay for spacious apartments close to the office, nannies, childcare, private schools for their kids and corporate cars taking them everywhere. The regular employee at a bank does well, but their lifestyle is nowhere near the top brass.
Upskilling And Training
Even with the current layoffs, the U.S. still has around 11 million jobs available. Despite fears of an upcoming recession, there is still a war for talent, especially in hard-to-fill roles, such as software engineers.
To remedy the imbalance of open jobs in sectors that require specialized skills compared to the existing pool of candidates, progressive and forward-thinking companies are upskilling, re-tooling and training their personnel.
Businesses are offering in-house or third-party online courses to learn in-demand skills, such as software development and data analytics. They are also providing mentors, coaches and continual training and learning. Companies, including Target and Walmart, offer free college tuition for their workers to learn and grow.
This trend not only helps the existing workers, but is also a good way to attract, recruit and retain talent, as the workers feel valued and appreciated and see that there is room to grow and develop within the organization.
Helping With Employee Mental Health, Emotional Well-Being And Burnout
Although the world would like to put Covid-19 in the rearview, people are still hurting. Watching loved ones fall sick and succumb to the virus has deeply affected people. They realize that life is short and harsh at times. Additionally, being locked up for two years has taken a toll. Americans have been experiencing a large-scale mental health crisis.
One of the antidotes is for companies to acknowledge this crisis and take action. Many organizations have made mental health a top priority. They offer counseling, therapy, mental health and emotional well-being apps and memberships to gyms and fitness centers. Mental health days off are now normalized. Companies have shut down their offices for a week or two, so that everyone can disconnect from work and recuperate. Zoom-free Fridays, off-site activities and other employee-empowerment initiatives have been put into place.
Human Resources Burnout
HR professionals have an exceedingly challenging job. They’ve dealt with an overwhelming amount of anxiety and pressure during the last two years. This cohort had to quickly figure out how to move their employees online and set up a robust and functioning distributed workforce, all the while dealing with a raging pandemic.
Without time to catch their breath, the economy reopened and HR was tasked with quickly hiring and onboarding people. The pent-up demand kept them working around the clock.
Now, they’re facing another challenge. Due to recent economic and global events, companies are downsizing and enacting hiring freezes. HR is on the frontline of having to manage this new and sudden change from rapid hiring to cutting costs. With layoffs and a pause in hiring, HR now has to also worry about their own jobs. During the pandemic, HR and recruiters were one of the largest groups that faced layoffs and furloughs.
Economists and Wall Street professionals predict that the U.S. is heading into a recession. They say it could be very bad and we may even experience stagflation not seen since the late 1970s and 1980s. These possible events will continue to add pressure and stress on this already-overtaxed group.
Criminal Records May Be Overlooked
In the wake of George Floyd, diversity, equity and inclusion will continue to be at the forefront. Lifting the barrier to gainful employment, along with the recognition that businesses desperately need more workers, companies are changing their tune on job seekers who have criminal records. Up until recently, having a felony on your record barred a person from many jobs. This group has been trapped by their past and unable to break out of the stigma attached to having been in prison. Companies are now becoming more open to “second-chance” employment, giving this pool of untapped potential an opportunity to overcome and succeed.