2023 is just around the corner and as a consequence of a tumultuous few years, the UK is going through a challenging period, both economically and socially. The world of work is also being significantly affected by global events. Caroline Egan, Career and Executive Coach to WBS alumni, looks ahead to 2023 and analyses five of the top workplace trends for the coming year.
The state of the UK economy will significantly affect businesses and employees
In 2023, both workers and companies will be deeply affected by inflation (predicted to rise as high as 17% in early 2023), and the rising cost of energy due to global events. Employers are already taking action to preserve profitability by cutting non-energy costs and mitigating supply chain risks, which will also affect hiring patterns.
PwC’s latest Pulse Survey from August 2022 shows that human resource leaders are looking to reduce overall headcount and focus on finding talent with specific skills. In spite of increased job creation and declining unemployment, many companies are looking to strategically manage headcount to help navigate volatile economic times ahead.
Employees are facing a huge increase in the cost of living, so will be seeking to maximise their incomes through promotion or job moves, which may only increase labour shortages in some sectors.
Career mobility and upskilling will be top priorities for employees
A natural consequence of the current environment is that some of the top priorities for employees are upskilling, and opportunities to grow and be promoted at their current company. Research for LinkedIn’s 2022 Global Trends Report showed that this is partly due to the pandemic, as well as the result of shifting job requirements and an uncertain job market. These factors have left people feeling their skills are out of date, unprepared for their next career move, and in need of more support with training and development. The same report also found that employers are changing tactic to ‘building talent’ in house rather than ‘buying’ it, the reason being that as companies cut costs and reduce hiring, they will still need to identify and retrain existing workers to fill open jobs.
Another virtuous effect of this is that offering employees the opportunity to move up or laterally boosts retention. LinkedIn’s Global Talent Trends, October 2022 report found that an employee who has made an internal move has a 64% chance of staying after three years, whereas an employee who has made no internal moves has a 45% chance of remaining with the company.
Enhanced employer assistance
In spite of the mention of hiring slowdowns and freezes, there are still employers who find it difficult to fill roles. Given the ongoing shortage of staff in some quarters, in order to help with retention, many large employers are offering staff assistance with the cost of living. One thing we’re sure to see is an increased expectation for employers to help people with their financial situation. This includes offering more affordable benefits in kind, as well as providing tools and programmes designed to bolster employees’ financial ‘literacy’ and psychological wellbeing.
Recognition that employee wellbeing is crucial to business outcomes
As remote working blurs the line between work and life, HR leaders are increasingly prioritising employee wellbeing and mental health. This focus on nurturing employee wellbeing is critical to developing workplace resilience. Over the last few years, employee wellbeing has expanded beyond physical wellbeing to include mental health provision such as free online counselling sessions, training leaders on empathic leadership, and funding subscriptions for online mental health support and meditation apps.
A 2022 report from the UK-based National Forum for Health and Wellbeing led by the organisational psychologist Professor Cary Cooper, highlighted that the changing business environment has led to the emergence of three trends that amplify the need for employers to demonstrate that they care about wellbeing. These include the priority which generation Z and millennials place on wellbeing compared to previous generations, the permanence of hybrid working models, and the increased focus from investors on environmental, social and governance indexes, which increasingly includes health and wellbeing considerations. Report co-author Dr Richard Heron, former Vice President for Health at BP, is quoted as saying “The evidence is increasingly clear that when leaders genuinely care about worker wellbeing, business outcomes of interest are better, whether they be long-term stock price, the ability to attract and retain talent or the robustness of safety and governance approaches.”
Remote working trends
PwC’s Pulse Survey report further found that as more and more companies accept the new realities of flexible working, many are embracing the benefits of having partially or wholly remote positions staffed by skilled workers. Several years after the Covid-19 pandemic ushered in a new era of remote work, many companies have now settled into hybrid or fully remote work arrangements.
The LinkedIn Global Trends report also refers to the fact that for most employees, work-life balance and flexibility come second only to compensation. Whilst the change to remote working has been largely beneficial for most people, some remote workers feel disconnected or isolated from their teams and may be more likely to leave as a result. Since a lack of connection has also been shown to affect motivation, productivity and creativity, it's recognised that as we approach 2023, employers need to address this issue, either through better use of collaborative working via technology or even through increased office presence.
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