The labor market is in flux due to, among other things, the corona pandemic, staff shortages, flexible and hybrid work and the increasing focus on mental health and stress in the workplace. What does the future of work look like? The ADP Research Institute (ADPRI) examined it in People At Work 2022.
Nela Richardson is chief economist at ADP and co-head of ADPRI. During her visit to Europe, she spoke about the results of the People At Work 2022 survey, focusing on some specific Dutch results. “We’re seeing a big shift in the way employees view their relationships with organizations.”
Change at work
The research contains numerous interesting insights about employees and the international labor market. According to Richardson, what were the most surprising results? “There were two. The first is how much value people place on change. In the last three surveys, we see an increase in the number of people looking for new jobs. On the one hand, they are trying to secure their jobs for the future, and on the on the other hand, they’re also trying to achieve a better work-life balance. When you know that almost 30% of employees worldwide are working on this, it’s quite a change.”
The role of stress
Richardson found the role of stress at work in another striking finding. A problem that exists worldwide and also plays a big role in the Netherlands: 11% of Dutch respondents struggle with stress on a daily basis and more than half experience stress at least once a week, according to the survey.
“Two-thirds of all workers worldwide are negatively affected by the pandemic. This can be job loss, lower wages or increased responsibilities in their position. The uncertainties that emerged in the survey last year are reflected this year in the form of stress. The clear majority of workers worldwide experience stress at least once a week. If there is one outcome that employers need to remember, it is the amount of stress that exists in their organization. We know that stress causes employees to perform less and is more likely to leave the company. In a world where staff shortages are the order of the day, this is something organizations should actively try to reduce,” Richardson said.
Labor market challenges
All too often we see organizations using salary increases as a strategy to combat staff shortages in order to keep existing employees happy and attract new talent. Is it still a sustainable strategy? Richardson is aware of that: “It works in the short term. Because we know that wages are still the most important driving force for people to work. I think short-term pay increases at least help attract talent. But this only works up to a certain limit. Not all companies can raise wages, especially in customer-facing jobs in the service sector, where margins are thin.”
The relationship with the employer
According to Richardson, it is important to understand how employees now view their relationship with their employer. “There is what I would call a major adjustment between companies and employees. The employees have new expectations, not only about salary increases, but also about other benefits. They understand that the boundaries between work and private life have blurred over the past two years. People now see that they can be at home when the kids get home from school and still do the work that needs to be done at the same time. On the other hand, they also know that there have been major changes that they have had to adapt to and feel that they must be compensated for this. The employees can expect a salary increase, as they have been given more responsibility in recent years. But they may also simply need one because of rising inflation and the higher cost of living.”
What must organizations do to keep their employees happy and attract new employees? “Companies with large brick-and-mortar stores have invested in the customer experience: They have created a reason for customers to still visit a brick-and-mortar location. Organizations will need to do the same with their employees. Provide an employee experience that includes more than just a good salary. Also consider benefits such as mental health support, sabbaticals, flexible hours etc,” says Richardson. She adds: “I always say that the employees are never in the driver’s seat, but organizations are. But the employees are now the noisy passengers who indicate where they want the company to go. A smart employer will listen to that!”
What is striking in the Netherlands is the importance employees attach to challenges in their work. In our country, 40% of employees who are not satisfied with their current job say that it is because they no longer have a challenge in their current position. This percentage is much higher compared to all other countries in the survey. Richardson: “I’ve also noticed that the Netherlands really stands out in this area in Europe and globally. We think there’s a cultural reason for this. That working here is not just about pay or job security, but really about joy, and that part of that pleasure is due to the extent to which professional growth is possible. Dutch organizations would do well to continuously stimulate this growth by promoting their employees’ skills and, for example, offering training or courses.”
The survey also shows that, similar to previous years, work is done with unpaid overtime to a large extent. A quarter of Dutch employees say they work overtime for an average of 6 to 10 hours a week. How does Richardson see this issue evolving? “We have seen a significant increase worldwide, although it is lower in the Netherlands than in other countries, but still high and also higher than before the pandemic. I don’t think the current situation is sustainable in the long term. During the pandemic, many people have been given additional responsibilities. Another reason why employees work extra is job security. They fear that if they do not provide extra work, they may lose their jobs. It can also come from remote work. This results in longer working days, and many now also work during the time they normally travel to the office. In a way, companies benefit from this without paying for it.”
It is clear that the People At Work 2022 survey contains a wealth of detail with interesting and current developments that will rethink the relationship between employee and employer for years to come. Finally, how does Richardson envision this future? “Nine out of ten Dutch employees are optimistic about the future. In general, employees are optimistic people, maybe not always about today, but certainly about the future. I would say to employers: embrace that optimism and use it. It really is a gift!”