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Is the age of the empowered employee over?

March 19, 2023
Borderless Leadership

The Great Resignation seemed to peak in November 2021, when a record 4.5 million workers quit their jobs in a single month. Desperate to retain employees, companies were scrambling. They offered more flexible work. They conducted surveys about company culture. How about more employee recognition programs? Four-day workweeks? Pet insurance?

Sure, some of the attempts to retain hires were ham-fisted. Company swag and lunchtime yoga don’t stop people from heading for the door in a tight labor market, especially if they feel underappreciated (or under-compensated). But the wave of new perks and focus on company culture did signal that employees were gaining more control, and employers were listening. (To some degree, at least: Income inequality has likely only increased over the past few years.)

Now, more than a year later, as the country’s economic outlook has soured, employee power is less certain. “The Bosses Are Back in Charge,” declared The Wall Street Journal recently, pointing to the tens of thousands of workers who were laid off in January—and the likelihood that more painful cuts still loom. (Fast Company also explored this topic on The New Way We Work podcast.)

At the same time, companies are pushing their remaining employees to get back into the office. Among those that have announced return-to-office mandates are Twitter (at least 40 hours per week), Disney (at least four days per week, starting in March), and Goldman Sachs (five days per week). A recent Resume Builder survey found that 90% of companies are planning to bring workers back at least part-time in 2023.

While some employees are happy to return to their workplaces, research suggests that there’s a gap between how employers and employees feel about remote work, with managers pushing for more in-person time than what individual contributors would prefer. When Amazon CEO Andy Jassy announced recently that employees should be spending a “majority of the time” back in offices starting May 1, workers quickly launched a petition opposing the mandate.

When employees do come into the office, they “want to feel like there’s a return on investment,” says J.P. Gownder, VP and principal analyst on Forrester’s Future of Work team, noting that workers don’t want to clock in simply to justify their employer’s downtown lease or to engage in some sort of inscrutable “culture-building” effort. But with continuing layoffs, many are finding themselves less able to push for flexibility in terms of where and when they work.

In an effort to rein in budgets, companies are also cutting benefits—often the same ones they touted during the Great Resignation. According to a 2022 survey by the Society for Human Resource Management, the number of U.S. organizations offering additional maternity leave (beyond the legal minimum) dropped from 53% in 2020 to 35% in 2022. Companies offering additional paternity leave also fell, from 44% in 2020 to 27% in 2022. Johnny C. Taylor Jr., president and CEO of SHRM, told Fortune in August that employers were saying, “The job market is softening, so we don’t have to offer these super-competitive benefit offerings anymore.”

No business leader exemplifies this shifting dynamic more than Elon Musk, whose top priority when he took over Twitter last fall seemed to be wrenching power away from workers. He’s done it ruthlessly, in requiring employees to both show up in person and to work more, period. After laying off thousands of workers, Musk struck a bleak tone in his first email to staff, banning most remote work (which he later was forced to walk back), and even installing makeshift bedrooms in Twitter’s San Francisco headquarters in a bumbling attempt to boost productivity.

Though Musk is an outlier, he’s also an influencer, and other business leaders have been watching him closely. Musk’s actions move the CEO “Overton window,” in terms of what other chief executives feel they can get away with, Gownder says. In a column from December, New York Times technology writer Kevin Roose cites several high-profile leaders who have publicly praised the billionaire business magnate’s approach, including Netflix’s Reed Hastings.

In the meantime, Musk and others have continued to push back against organized labor. Tesla recently fired a group of New York-based employees who were attempting to form a union just one day after they went public with their plans. (The company claims the firings were not retaliatory.) Starbucks, which, like Amazon, has experienced a wave of organizing, has been slow-walking negotiations with unionized stores.

Does this mean the age of the empowered employee is over? Are we all doomed to return to a pre-pandemic era that glorified hustle culture, rigid 9-to-5 (and then some) workdays, and limited workplace perks and protections?

A closer look at the full economic picture suggests that the situation is not as dire as it may seem. Despite high-profile layoffs and lingering inflation, the current U.S. job market is strong, with a staggering 517,000 jobs added in January, and the lowest unemployment rate since 1969. Research also shows that tech workers—the majority of those affected by layoffs so far—are still very much in demand and quick to be rehired. In fact, many companies are still struggling to find enough highly skilled talent to fill their open roles.

Despite pushback from corporate leadership, the organized labor movement is also showing signs of growth coming out of the pandemic. Interest in unions is rising, especially among younger workers. In the 2022 fiscal year, the National Labor Relations Board saw a 53% increase in union representation petitions compared to the year prior. Today, employees are increasingly looking to unions to gain power in their workplaces, even in traditionally nonunionized industries, like tech and cannabis. “Workers [are] taking matters into their own hands, trying to look for local solutions in their own workplaces and their own industries,” Sherer says.

Unions offer a means to protect workers and express their discontent about decisions made by leadership—a feedback mechanism that became particularly important during the pandemic. In 2022, worker demands focused on better pay, additional health and safety measures, and better staffing. It’s a list that reflects “the challenges workers have faced since the beginning of the pandemic,” according to Johnnie Kallas, project director of the Cornell-ILR Labor Action Tracker, in a recent interview with Fast Company. With mass layoffs and economic anxieties front and center these days, it’s unlikely we’re going to see an end to this sort of interest any time soon.

More broadly, the pandemic has led to a fundamental reckoning about how, where, and even why we work. A good number of people—including some forward-looking employers—realize that a more flexible mentality around the integration between “work” and “life” is possible (and even desirable) to cultivate productive and engaged workers.

During the height of the pandemic, chief people officers were almost exclusively focused on employee well-being, according to Didier Elzinga, CEO of Culture Amp, an employee experience platform used by employers like McDonald’s, Oracle, and SoulCycle. Now, Elzinga says, their attention is shifting: “What’s happened in the last six months is that a lot of organizations [are thinking] ‘Well-being is still important, but it can’t be my only focus.’”

Instead, companies are asking “Who’s creating impact? What are we doing to keep those people? How are we looking after those people?” he says. With tightening budgets, leaders may not have the freedom to offer every benefit or perk under the sun. But employee engagement still matters, even if it’s more narrowly focused on how to retain and support high-performing workers.

After so much death and social isolation, many of us want our work to have more meaning. Burnout and “quiet quitting” have not gone away—even with a less certain economic forecast making workers more cautious, and executives more bold. And retaining talent has become more important than ever. Business execs might find Musk’s management style tempting in the short term, but they’d be wise to remember that workers have long memories—and this moment of economic uncertainty won’t last forever.

By Julia Herbst


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