While there's ample reason for businesses to be optimistic as we embark on a new year — last month's rate of job growth was the fastest recorded in seven months, for starters — Omicron is the gatecrasher no one wanted to see. Meanwhile, even as companies engage in Q1 hiring, the labor market continues to tighten and contract, the Great Resignation appears to be accelerating and nearly every employer is vulnerable to vacancies.
With so much uncertainty in play, what's next for organizations looking to get ahead?
tapping into new talent pools
For employers confronting a shortage of qualified workers within their industry, one effective workaround is to start sourcing talent outside of it.
Consider that 60 percent of workers now say they feel inspired to follow in the footsteps of their colleagues and make career changes. Particularly for employers in the healthcare and tech spaces, both of which saw spikes in job search volume last month on Monster.com, this might seem like an especially compelling play.
To win these converts, competitive compensation will be a must, and many companies will look to leverage higher pay in an attempt to drive better recruitment and retention outcomes — which might work. But inflation is climbing at the fastest pace recorded since 1982, and if that continues it won't just drive up prices for everyone. It could also serve to neutralize incremental pay increases as an effective lure for talent, meaning employers will have to go beyond the usual pay bumps of just one to two percent to be truly competitive.
health and safety are huge concerns for employees
With the rise of Omicron, concerns around workplace health and safety are front and center for employees as never before, especially for those who work onsite full time or in a hybrid model.
In fact, a recent Randstad Workmonitor survey confirms that having a safe working environment is among the top priorities for more than one-third of all workers.
The bottom line, then, is that addressing these and other safety-related concerns by adopting more stringent measures should be a key priority for employers. Those that don't, however, stand to lose valuable contributors in droves.
new urgency around upskilling and reskilling
Research from McKinsey has found that nearly nine out of 10 executives think their organizations are either currently suffering skills gaps or will be soon. And yet less than half of them have formal plans in place to fix the problem, according to the same study.
Upskilling and reskilling are the obvious solution, and with employees audibly asking for it, employers that take the lead stand to reap tangible benefits. Consider the fact that more than half of U.S. workers aren't sure what skills to develop in such a rapidly evolving job market, for example, and most of them (63%) say they're looking to employers for guidance.
On the flipside, organizations are going to start losing top talent if they don't start taking the new urgency around upskilling and reskilling more seriously. One study, for example, found that companies where workers aren't actively engaged in learning and development were twice as likely to lose employees prior to their third year of tenure. Another showed that 94 percent of employees are willing to stay with companies that invest in their career development. Both of those numbers translate to bottom-line value, especially in today's ultra-competitive hiring environment.
looking ahead: the next few months
While it's true that the full impact of the Omicron variant isn't yet registering in labor market indicators (the keyword being yet), there's ample anecdotal evidence that it will soon: widespread restaurant closures due to newly infected workers, for example, or the 20,000-plus airplane flights that have been cancelled in the U.S. since Christmas Eve.
With all of this in the background, many businesses recently decided to delay or even reverse their return-to-office plans, which is wise. Over the course of the next few months, however, this may well prove to be a sticking point and source of friction, as it's an area where leaders and employees don't exactly see eye to eye. In Slack's Future Forum Pulse, for example, 68 percent of executives said they wanted to work in the office most or all of the time, and nearly half said they would prefer everyone to be there every day. By comparison, only 17 percent of employees said the same.
Clearly, tighter alignment is going to be required down the line, and for many organizations — especially the executives who lead them — that might mean truly embracing workforce flexibility as never before. Since the start of the pandemic, after all, employees have by and large reported increased productivity while working from home, and according to some forecasters, remote work will increase net productivity in the U.S. by five percent compared to pre-pandemic days.
Whether or not that comes to pass will in part hinge on when and how this lingering disconnect — call it flexibility versus return to normal — gets remedied. Stay tuned.