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30 Oct 2023
Insight
Global
3m read
New challenges, new norms
Our last Future of Work report was written during a period of upheaval, with the Covid-19 pandemic necessitating new ways of working and social movements – including Black Lives Matter, #MeToo, #StopAsianHate and growing climate activism – changing expectations of internal and external stakeholders.
Now the pandemic has abated but new challenges have emerged, as stressed supply chains and soaring energy costs have contributed to rising inflation and tough trading conditions in many markets. Economic anxiety is changing workers’ priorities and, as a result, employers’ agendas too: 80% of companies in our latest survey say that economic trends, including the cost-of-living crisis and the threat of recession, are driving changes to workforce policies.
Economic fears have sapped momentum from the Great Resignation and quiet quitting trends, giving employers leverage to reconsider flexible ways of working that, in the eyes of many firms, had become a little too flexible. This is most visible in the increasing drive to recall employees to the office.
Meanwhile, the ongoing digital revolution, and especially the emergence of generative AI, is changing work in other ways. New technologies have raised hopes of productivity gains but also revitalised fears of job displacement. This includes white-collar and creative professionals, many of whom never before considered technology a threat to their livelihood. Digital tools are also giving employers powerful new ways to manage – and even micromanage – their workers.
None of this is to say the changes the pandemic brought to our working lives are gone and forgotten. Even as more work happens in the office, the possibilities for how we labour are forever changed. Norms regarding how employees are managed continue to evolve. With the global health crisis still fresh in our collective memory, workers and employers alike also have a new appreciation of the importance of wellbeing at work.
Against this backdrop of rapid change, we sought to examine how employers are addressing the likelihood and potential risks of activism in their workforce and how they are handling critical changes in workforce relations. Our global survey of 500 key decision-makers on workforce-related issues detected a retreat from freedoms accrued during the pandemic and more widespread use of restrictions on employee activism. We found employers striving to get ahead of controversy and craft workplace policies that promote productivity without losing ground in a war for talent that still rages in many regions thanks to tight labour markets.
Accomplishing all of this without pushing employees too far, running afoul of regulators or raising the ire of other external stakeholders will be a challenge. There is no one-size-fits-all approach to these issues, and even the best-intentioned employers will make mistakes along the way. This report aims to help employers build a roadmap for success in what remains an uncertain environment.
The Future of Work 2023: Headline findings
The post-pandemic era has so far been defined by economic disruption. Our 2023 Future of Work survey indicates that worries about rising inflation and the cost of living appear to have dampened employees' appetite for challenging issues in the workplace, but this may be only a temporary reprieve.
As employers shape and navigate the new norms of working life, they face many potential pitfalls: how to encourage staff to return to the office without deterring talent, and how to capture the productivity benefits of technology without provoking employee concerns, are chief among them.
Key contacts
Emma Rohsler
Regional Head of Practice (EMEA) - Employment Pensions and Incentives, Paris
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© Herbert Smith Freehills 2024