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Inflation Concerns Rising, COVID-19 Concerns and Employee Engagement Declining, as Detailed in New SHRM State of the Workplace

ALEXANDRIA, VA - Today, the SHRM Research Institute released the 2022-2023 State of the Workplace Report, detailing the areas where U.S. organizations succeeded in 2022, the most pressing struggles they face currently, and organizational priorities for 2023. For 75 years, SHRM has worked to improve workplaces for everyone. Now, as the world emerges from the pandemic, we stand ready once again to offer insights and to help organizations answer questions that have implications for the U.S. economy and employers. 

The 2022-2023 State of the Workplace study identified three new key areas of focus in 2022: getting past the COVID-19 crisis, increasing inflation, and low engagement among employees.   


Unlike 2021, where the focus for most organizations was managing COVID-19 concerns, in 2022, organizations began to prioritize other initiatives, and they expect this trend to continue in 2023. Inflation emerged as the biggest challenge and fastest growing concern for HR professionals in 2022, jumping 13% from 2021. HR professionals and executives both rank maintaining employee morale and engagement as the highest priority for their organizations in 2023. 

“Our research also depicts labor shortages are continuing to impact organizations. Employees, HR professionals, and HR executives reported recruiting and retaining talent among their top five priorities for 2023,” shared Johnny C. Taylor, Jr., SHRM-SCP, President and CEO, SHRM. “Based on this report, 2023 is going to be a pivotal year for both employees and executives. We expect to see big changes in regard to budgetary concerns - while still considering talent and retention challenges.” 


Key findings include:  

- Through 2023, employees and organizations alike are planning for the effects of rising costs. 

  • Four-fifths (80%) of HR professionals are concerned about how the economic situation may affect their organizations. Nearly half (48%) worry about budget cuts. But even more (86%) worry about the consequences for employees’ lives. 
  • Despite the economic concerns, 74% of HR professionals expect their organizations to expand their workforce this year. It appears that the job market will continue to favor job seekers and that the talent crunch will not ease in the near term. 

- There is a consensus among HR professionals that COVID-19 moved from a crisis in 2021 to a manageable concern in 2022. 

  • Only 35% agreed that bringing more of the workforce back to in-person work was a priority for this year, a 13-point drop from 2022. 

- The study also found widespread employee dissatisfaction – especially among non-HR employees. 

  • Only 46% answered yes to each of these two questions: 1) Would you recommend your organization as a great place to work? and 2) Do you trust your employer to treat you fairly? 
  • 24% of HR and 26% of non-HR workers plan to seek a new job in 2023. 
  • HR professionals and executives both rank maintaining employee morale and engagement as the highest priority for their organizations in 2023. 

- Remote and hybrid non-HR employees are more likely than on-site employees to recommend their employer (56% vs. 44%). 

  • However, remote/hybrid workers are also more likely than their on-site counterparts to be looking for new a new job (30% vs. 21%). This surprising result shows that remote employees are both happier and more likely to be looking for another job. 

- Only 38% of HR professionals believed they had effectively supported employees with mental health challenges in 2022. 

  • Mental health was the third greatest external challenge for organizations in 2022, with 72% of HR professionals citing it. 
  • For 2023, strengthening mental health benefits or coverage is a priority for 51% of HR professionals, an increase of 9 points over 2022. 

We are continuing to see mental health emerge as a critical workplace issue. Discussions about employee mental health were rare prior to the pandemic. But now employees at all levels, even at the corporate board level, are focusing on mental health,” shared Alex Alonso, PhD, Chief Knowledge Officer, SHRM.  


To view the full 2022-2023 State of the Workplace report, click here. 



This report includes the results from a set of surveys in November 2022. The core survey sample included 1,793 HR professionals in the United States, and the results of this large sample are used in most of the sections of this report. Also, a sample of 276 HR executives was used to provide additional information to supplement results from the HR professional sample. Further, a third sample of 585 non-HR employees was used to provide a separate perspective.   


About SHRM 

SHRM, the Society for Human Resource Management, creates better workplaces where employers and employees thrive together. As the voice of all things work, workers and the workplace, SHRM is the foremost expert, convener and thought leader on issues impacting today's evolving workplaces. More than 95 percent of Fortune 500 companies rely on SHRM to be their go-to resource for all things work and their business partner in creating next-generation workplaces. With 300,000+ HR and business executive members in 165 countries, SHRM impacts the lives of more than 115 million workers and families globally. Learn more at and on Twitter @SHRM. 


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