Looking back at the beginning of 2020, the US economy was ripe for business. We were living in the “good old days,” marked by low interest rates, low or no inflation, and steady, sustainable economic growth. But, the “good old days” are over.
According to our research at Vistage, CEO confidence has changed more dramatically each quarter for the past two years, with quick spikes and sudden drops than during the seven years before the pandemic. Rising inflation, geopolitical conflict, protracted hiring challenges, supply chain slowdowns and skyrocketing oil prices are among the factors sending US business leaders’ confidence plummeting in the second half of 2022. CEOs have begun to accept disruption as part of their new reality. .
Subsequently, business leaders laser-focus on the areas over which they have the most control, such as talent. Whether we are entering or already in a recession, we are not experiencing the job losses that we have traditionally associated with economic downturns. The job market has consistently outperformed expectations and unemployment has hovered at near-record levels. The right talent is available, but recruitment and retention remain top challenges. Today’s talent has their choice of roles: if they’re not satisfied with their current salary or culture, they have the power to join the Great Improvement and find a role that best suits their needs.
To meaningfully address recruitment and retention, it’s important for leaders to first understand the modern worker. Accelerated by the growing dominance of Millennials and Gen Z in the workplace, the modern worker is empowered. They are looking for a job that fits their needs, rather than finding a job they can fit into. They expect their organization to align with their values, and they want their daily tasks to have some kind of greater meaning. They are no longer willing to settle for a job that does not allow them to live the life they want.
As the modern worker proliferates in the workplace, the traditional 9-5 Monday-Friday schedule, which is the ultimate solution for all workplaces, is on its last gasp. CEOs trying to resurrect their previous mandates for teams that have embraced hybrid working during the pandemic are often met with resistance. In fact, a recent ADP survey found that two-thirds of the workforce would consider looking for a new job if asked to work in person full time. More than half (52 percent) said they would be willing to take a pay cut to give them more flexibility. Most CEOs can’t afford to lose this battle.
Still, this change comes with its own problems for leaders. CEOs report a decline in company culture and collaboration as a result of remote work. Frontline managers have a hard time managing hybrid teams. CEOs are looking for a silver bullet to help power the future of flexible working, but finding the right formula for in-person versus work-at-home work isn’t prescriptive. Each team within each organization must find what works best for them, and that will require continual trial and error. It is new territory for all of us. But if harnessed correctly, it holds the potential to unleash the next wave of human productivity.
CEOs mastering flexibility, from offering L&D and upgrade programs tailored to managing modern teams, to upgrading technology to better serve hybrid workers, to redesigning shared office space to better fit the needs of in-person work, Seeking flexible hours for companies that can’t-can increases retention, boosts hiring efforts, and weathers the headwinds of a volatile and unpredictable economy for years to come. Leaders who create an environment that allows employees to switch seamlessly between autonomous and collaborative tasks will eliminate the need for monitoring. Instead, encourage employees to take an active role in determining what level of hybrid makes them most efficient and productive.
The “good old days” may be over, or maybe, we’re just getting into them. By recognizing what employees want and desire, we are unlocking a new wave of work that puts employees first. Regardless of what the economy does or doesn’t do, having talent in place will set companies up for long-term success.