With 2020 in the rearview mirror, both employers and employees are increasingly optimistic about the future. The dissemination of coronavirus vaccines, a push to reopen shuttered schools (freeing more parents to get back to work), and the outlook for a gradual return to normalcy are all helping move people from hopeless to hopeful. What can we expect to encounter during that journey? Here are four trends we are seeing:
Regardless of economic conditions or the state of the job market, compensation continues to be a critical factor in every employer’s ability to attract and retain good talent. Given current circumstances, it would be easy to assume employers hold the advantage. According to the BLS, compensation trends dipped in 2020 compared to the previous year, only rising 2.6%. With millions anxious to get back to work, some might assume pay has taken a back seat in evaluating an opportunity. That is rarely the case. While we are seeing greater emphasis on flexibility, work/life balance, and physical and mental health issues emerging as drivers of talent outcomes, compensation continues to be the #1 driver of candidate attraction and employee retention.
In the past year, many employers froze or even lowered salaries. Employees were likely patient, given the emergency situation, but that patience will wear thin as the economy improves. The research we’ve done over the last two decades has shown that even when people accept lower salaries due to poor economic conditions, they look upon that as a temporary pause in the natural progression of regular increases in pay.
The pandemic also brought special salary boosts that incentivized certain types of work needed during the public health emergency. These temporary shifts in salary were closely linked to local market conditions. A return to normalcy will require a close watch of salary trends by market and job demand and an understanding of every individual’s expectation to be fairly compensated for their labors.
There was a time when diversity was viewed as a corporate program rather than a corporate strategy, but those days are long past. Diversity may still offer a snapshot of the workforce in all its many facets, but when coupled with inclusion, it provides an action agenda for ensuring all those diverse elements feel empowered to contribute at optimal levels.
In our Emerging Workforce® Study, it is apparent that both employers and employees understand the importance of diversity and inclusion in recruiting and retention. Nearly two-thirds of all workers and more than three-quarters of younger workers consider the composition of the workforce a significant factor in their desire to work for a company. Younger workers tend to place even greater value on a workplace that fully embraces diversity and inclusion, especially in terms of collaboration, growth and development, learning, and competitiveness.
Do employers agree? They actually have even stronger feelings about diversity and inclusion:
Essential to business success, diversity and inclusion positively impacts collaboration, innovation, performance, and customer loyalty. It is a critical element in attracting, engaging, and retaining the best talent.
The great remote work experiment that took us from less than five million remote workers to upwards of 50 million overnight has been deemed a success by many. Although employers had deep pre-pandemic concerns about issues such as productivity, engagement, and loyalty, the reality of remote teams has mitigated much of that.
Today, even with enhanced health and safety protocols making it possible to recapture pre-pandemic work routines, many remote workers opted to stay home. For some, it was a necessity due to childcare issues; others had health concerns. Of course, not all work can be conducted from a home office. Approximately 60% of workers are in jobs that typically require an onsite presence, according to the U.S. Bureau of Labor Statistics (BLS). For the other 40%, the trend toward continued remote work, post-pandemic, was confirmed in a Gartner study in which 90% of HR leaders said their employees could work remotely at least part of the time, even after a vaccine is widely adopted. Blended models, with time split between office and home, are expected to become the norm, even after the pandemic passes.
This new flexibility reflects what both employers and employees discovered during the pandemic: remote work should no longer be a perk restricted to the most senior-level employees but a must-offer option at all levels. In fact, if given the choice, two-thirds of office workers would opt for remote work, according to Gallup. By embracing remote work models, employers boost their talent attraction capabilities. Not only will they be more attractive to more people, they also have the opportunity to increase diversity and inclusion by widening their talent pool beyond local markets.
The pandemic upended normal activity, driving adjustments and adaptations in almost every aspect of life last year. All that chatter tended to overshadow the news that demand surged in many sectors as new needs were identified for both products and services to support a nation in the grip of a public health emergency. Consider the examples that follow.
Despite continued uncertainty in so many aspects of our lives, we are optimistic about the future. Among the many things we’ve learned in the past year, adaptability and flexibility will ensure our return to growth and prosperity. We may not know exactly what the future holds, but we do know there are opportunities ahead for those who are armed with the right information needed to make smart hiring decisions. Continue to monitor the trends, talk to recruiting experts, and check your numbers. We can help with that, as we have compiled the market data you need to know by location, position, and experience. Talk to us today as you navigate your workforce planning requirements to ensure a bright future.
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