After what could be two full years of working from home, there is a growing disconnect between employees reluctant to return to their desks and executives pushing to get them back – and this exacerbates the challenges businesses face in attracting and keep people in a white- hot labor market.
While many companies offer more flexibility to compete with scarce talent, some HR experts are concerned that this may lay the groundwork for retention issues in the future.
“It’s a complicated problem, and it’s something that companies come to terms with as this Covid crisis spreads more and more,” said Andrew Challenger, vice president of executive outplacement firm Challenger. , Gray & Christmas. “For most of the last year, companies were saying we just had to get over this and it was going to get back to normal. And now that it seems rampant, they say if it’s for the long haul, they need to think about what their business will look like as a remote workforce. “
For most of the last year, companies were saying we just had to get over this and it would get back to normal. But now it seems rampant.
The workers themselves have already made the physical and mental shift. The iCIMS recruiting software platform revealed that nearly one in four applications filed last year came from out-of-state applicants, and that number remains high today: in July, around 1 applicant out of 5 were applying for out-of-state jobs. . A snapshot from August illustrates the scale of the churn rate: iCIMS found that job postings increased by almost 70% and hires by 57%, while the number of job applications only increased. only 2% since January.
Jewell Parkinson, director of human resources at iCIMS, said the company has seen the growing demand for remote and flexible working manifest among its own employees. “It’s more and more an expectation of the workforce,” she said. “We did a series of focus groups with employees and that’s when we heard loud and clear, basically, that people adjusted to this.”
There are other indications that workers expect to stay in their home office for the foreseeable future: Best Buy said in its quarterly earnings report, sales were up 20% from a year ago, attributing the increase in part to people working and consuming more media at home. “There has been a dramatic and structural increase in the need for technology,” CEO Corie Barry said in a statement.
A survey carried out by online newsletter leSkimm found that more than one in five millennial women said they would rule out working for an employer that banned working from home in the future.
In a CNBC interview Wednesday, Salesforce CEO Marc Benioff observed that the popularity of remote working among the grassroots had taken business leaders by surprise. “Not as many employees are returning to their offices locally as any CEO expected,” he said. “You are really starting to see very low attendance figures in offices because the employees are very productive at home. “
“The truth is, CEOs recognize that productivity has increased. People work more and it’s more productive. People want that. People want the ability to work from home and work their way, ”said Dave Carvajal, CEO of Dave Partners, a tech recruiting company.
But, he added, CEOs were often reluctant to cede this measure of control, even when remote working was clearly productive. “We’re sort of in a transitional phase. Many CEOs operate on older models. … There is this notion that when the cat is away, the mice will play.
In addition to greater autonomy, today’s mobile workers are forcing businesses to adapt to their schedules. Competition in the job market has increased as human resources departments have much less time to determine whether a potential hire is suitable. “The stakes are so high and the rules of the game are so competitive right now… companies can no longer afford to roam,” Carvajal said. “There is no room for incompetence in recruiting and hiring.” With the best candidates often receiving multiple offers, Carvajal said he tells his clients that hesitating means losing.
“What we found is to really compete for talent in the market, we had to accelerate our ability to be much more effective in the hiring process,” Parkinson said.
“It’s a big test for middle managers,” said Laurie Monteforte, spokesperson for Ladders, a job site that focuses on employment with salaries of $ 100,000 and more.
From March 2020 to July, Ladders observed a huge increase in the well-paying jobs available remotely. Advertisements for media, marketing and design work that could be done remotely have increased by almost 1,000 percent, from less than 2 percent to nearly 20 percent of all jobs in this industry. Remote project and program management positions increased by approximately 800%, remote accounting and finance job openings increased by 750%, and HR and legal jobs that can be performed remotely increased by nearly 550%.
This increased competition is a huge challenge for growing businesses.
A. “Ray” Wang, Founder and CEO of Constellation Research Inc., said having a dispersed workforce before the pandemic gave his Silicon Valley-based company a hiring advantage. . “We have never been constrained by geography. I think it has been helpful in that regard, ”he said.
But now, as remote working becomes the norm, Wang said it took him about twice as long to fill positions as before Covid. “The job market is so tight that there is massive competition for highly paid people,” he said, which also increases the stake to keep employees on board.
“Salespeople tend to poach our people because we have good expertise in the space,” he said. “People are looking for highly skilled people.
In conversations with clients, Wang said many report high turnover among new workers. “The retention rates are very low,” he said, estimating that only about half of his clients’ hires in the pandemic era were still at their respective companies.
Given the accelerated pace of hiring, some HR professionals say this is not surprising, especially among companies that do not have a clearly articulated vision of how remote or hybrid work will play out at home. to come up.
“We are seeing employees leave companies that cancel their remote work policies entirely,” said Rhiannon Staples, director of marketing at Hibob, a human resources technology company. “I don’t think forcing people back to the office will equate employee engagement and satisfaction. “
Staples said it’s incumbent on executives to reconsider how they cultivate loyalty in the absence of regular face-to-face interactions. “I think what we’re going through in business is forcing managers to think differently about how they assess and communicate with employees,” she said. “It requires new skills. “
Challenger suggested that the remote nature of the job itself makes retention an uphill battle for HR departments. “You can be on Zoom for eight hours, but when it comes to all the items on the work agenda, there aren’t those little family conversations and personal moments that you have,” did he declare. “People are just not connected to their business when it is just the work itself. “
In addition, people working from home have fewer barriers to finding a job, Challenger said. “There is no friction for people to explore new opportunities. You don’t have to sneak into a suit to change to go for an interview in the middle of the day. You can always find the time to talk to other companies.
But Challenger also issued a warning for workers. The current labor market cycle isn’t going to last forever, and when companies need to tighten budgets and downsize, the less visible could be the most vulnerable if managers don’t feel a connection to them.
“People are more replaceable when they are far away. You are not as connected to them as human beings, ”he said. “Companies will feel even less loyal to their employees in the future. “
But for the foreseeable future, with workers in charge and waves of Covid underway thwarting a return to ‘normalcy’, businesses may have no choice but to keep letting people go. work when and where they want.
“It’s critical to how we position ourselves,” Parkinson said. “In my experience, any attempt to further limit or restrict or be rigid with where people work or how they work is actually a barrier to continuing to retain talent,” a- she declared.
“The workforce will get in there and insist. … This is not a flash in the pan, ”said Monteforte. “It will change everything.”