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This past year has been tough for workers and their workplaces with numerous high-profile layoffs, continuing inflation, versatility in work locations (in-office, remote, hybrid) and a highly competitive job market.

In order to attract, hire and retain top talent, employers will need to look at ways to meet certain employee expectations of what they want the workplace to look like. A number of trends have jumped to the forefront and employers will need to take a look at them in order to create workplaces where employees can thrive.

 Some of these trends are:

  • Prioritizing diversity, equity and inclusion (DEI) initiatives
  • Investment in corporate social responsibility
  • Focus on mental health and holistic employee well-being
  • Greater flexibility with work location
  • Quiet hiring, the opposite of quiet quitting
  • Pay transparency that is gaining traction
  • Skills-based hiring over hiring based on academic degrees

Let’s take a look at the potential impact of each of these on the workplace in 2023.

Prioritizing DEI initiatives

Diversity, equity and inclusion are no longer just words on a company’s career website to make the company look good – there has to be action behind those words and a firm commitment to DEI initiatives.

Employers will need to look for talent in underrepresented communities, including employees with criminal records who are qualified for the roles for which they are interviewing. Hiring older workers and those with disabilities, including long-Covid symptoms, is also on the rise and making accommodations for those with disabilities may include remote work. According to The Arc, the unemployment rate among people with disabilities is 65.4%, while the national unemployment rate is 5%, so the move to hire more workers with disabilities is definitely a strategic DEI initiative.

Investment in corporate social responsibility

Organizations’ commitments to corporate social responsibility (CSR) and environmental, social and governance (ESG) need to stay front and center despite fears of a looming recession. But now is not the time to slack on CSR and ESG efforts.

According to a recent KPMG survey, 70% of U.S. CEOs acknowledge that ESG improves financial performance, up from 37% just last year, yet 59% of CEOs said they planned to pause or reconsider their ESG efforts in light of the economy. But employees, customers and investors all make judgments and decisions based on a company’s dedication to these causes, so now might not be the time to cut back on these efforts.

Focus on mental health and holistic employee well-being

Burnout and mental health issues were prevalent in the workforce pre-pandemic, but the pandemic only exacerbated mental health issues due to job losses, the political climate, and social isolation. According to Gartner, 82% of employees today want their employers to see them as a whole person, not just as worker bees.

How can employers help with their employees’ mental health and well-being? By encouraging employees to take PTO. By instituting mental health days or half-day summer Fridays. By offering health insurance policies with generous mental health benefits. By training and encouraging leaders to practice empathy.

With the state of the economy and organizations having to do more with less, employers will need to prioritize mental health or employees will take matters into their own hands and potentially leave to work for employers who actually prioritize mental health.

Greater flexibility with work location

Remote and hybrid work options remain top of mind for 2023 as workers believe that the pandemic was a proving ground for employers reluctant to allow remote work. Without long stressful commutes, workers have a better work-life balance. Employers who insist on a return to five days in-office risk losing employees to companies that offer fully remote or hybrid options.

According to FlexJobs’ Employee Engagement Report, 48% of employers are maintaining some form of remote work for their workforce — 26% of respondents say their employer will follow a hybrid model, and 22% say they’ll be allowed to work remotely.

Other companies are trialing a four-day work week with results that include higher sales volumes, decreased burnout and lower rates of absenteeism.

Quiet hiring

“Quiet quitting” was last year’s buzzword, referring to employees who no longer take their jobs seriously and are doing the minimum amount of work to get by. Quiet hiring is the opposite of quiet quitting – it involves providing current employees with opportunities to go beyond the tasks in their job descriptions by providing them with upskilling that helps them achieve their career aspirations. Rather than hiring new employees, companies meet organizational skills gaps by developing skills in their current employees.

According to Gartner, quiet hiring is a tactic that is used especially during tough economic times. It  focuses on internal employee mobility by providing stretch assignments and upskilling to meet organizational needs while keeping headcount flat.

Pay transparency is gaining traction

According to the Harvard Business Review, by the start of this year, 20% of U.S. workers will be covered under pay transparency laws. And this trend is predicted to continue. As coworkers discuss their salaries with one another, managers will be faced with requests for pay adjustments to correct salary inequities.

Managers will need to be prepared to answer questions about how salaries are determined, what salary ranges mean, why a new hire may be making more than a more tenured employee, and what can be done, if anything, to correct a perceived salary discrepancy.

It would be wise for organizations to discuss this with frontline managers in order to equip them with ways to handle these difficult discussions when they arise.

Skills-based hiring takes precedence over academic degrees

In another move toward greater flexibility, many employers are starting to look more at job candidates’ skills to determine their ability to perform well in a job vs. whether or not they have an academic degree. Another reason for skills-based hiring is that companies can acquire better talent at a lower salary than hiring someone with a degree. There’s also a bigger applicant pool if having a degree isn’t essential for a job.

Some companies that are sourcing IT positions, including IBM and Accenture, are eliminating the college degree requirement. Accenture requires a college degree in only 43% of its IT job postings; IBM only requires a degree for 29%.

Some companies still believe, however, that holding a degree confers a higher level of professionalism, better communication and collaboration skills, and the ability to prioritize work tasks.

In today’s workplace, it is obvious that employees hold greater power than in the past and many are not afraid to speak up about workplace matters that are important to them. Understanding some of these key trends should help organizations to be better prepared to meet employee demands in order to retain their talent and create a happier and more productive workforce.

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