The past year was a turbulent one for the U.S. economy and workforce. Now, with inflation raging and a looming recession threatening to trigger rounds of layoffs, a new wave of economic anxiety is meeting a workforce emboldened by the challenges and changes of a post-pandemic economy.
In my role as a lecturer on entrepreneurship and innovation at Harvard University and as the founder of a human capital strategy firm, I’ve had a front-row view of how workers, businesses, and entrepreneurs are making meaning of this ever-evolving world of work. It’s clear that workers are still taking stock of the ROI of their careers and reimagining how work factors into their lives. While complicated by emerging economic concerns, this mindset will continue to be a driving force.
I believe 2023 stands to be a pivotal year for the future of work, as employers and employees alike come to terms with a workforce forever altered by the pandemic and its economic fallout. Here are five workplace trends employers must understand to succeed in the year ahead and beyond.
1. Gig work goes mainstream
Gig work is fast becoming far more than a side hustle for many workers. The size of the gig workforce is on track to surpass the full-time workforce by 2027. While gig work has been common in service industries for years, we are now also seeing a surprising rise in gig work among so-called skilled workers, with platforms like Incredible Health and Docketly allowing for on-demand services from nurses and lawyers.
Businesses, too, are now embracing gig work as a strategy for combating the triple threat of labor shortages, inflation and an economic downturn. Six in ten executives say they expect gig workers to substantially replace their full-time employers over the next three years.
2. A culture shift
At the center of today’s employees’ evolving expectations around work is the impact of a multigenerational workforce. The accompanying cultural shifts will require business leaders and middle managers to reassess their relationship with employees and even their definition of workplace success. Younger workers, for example, care far more about flexibility and work-life balance.
Employees are also seeking meaning nearly as much as high pay, and they are looking to work for companies that share their values. Indeed, doing the right thing is increasingly becoming a value proposition for companies. Last year, in a dramatic example, the founder of Patagonia announced he was transferring ownership of the company to a trust designed to combat climate change. In the year ahead, we will see more employers differentiate themselves by operationalizing their human-centered values.
3. DE&I initiatives embrace intersectionality
Today’s workers increasingly care about equity and diversity, with three-quarters of employees and job seekers saying a diverse workforce is an important fact when deciding where they will work. Companies have already doubled down on diversity, equity and inclusion initiatives in recent years following 2020’s nationwide protests against racial injustice. Now, those initiatives must evolve, growing to reflect a diverse workforce that holds many complex and intersecting identities.
Historically, DE&I Initiatives have largely aimed to promote diversity and belonging by providing support to groups of workers based on just one element of their identity. Employers are now starting to learn that real transformation occurs when leaders acknowledge, value and leverage the intersectional experiences and expertise of their workforce.
4. Reimagined job benefits
In 2021, women left the workforce in record numbers—in large part, due to their disproportionate family responsibilities. If women earned money for this unpaid work, they would surpass the combined earnings of the world’s 50 largest companies. With companies grappling with intense labor shortages, they must reimagine their benefits strategies to account for the busy and complicated lives of their workers.
Indeed, rethinking benefits is proving to be a sound recruitment and retention strategy across all genders. One of my clients, a fast-casual restaurant, recently decided to make their 401(k) plan optional and instead give their employees access to corporate match funding they could use in whatever ways most benefited them. Many of the workers used the funds on pressing housing and transportation costs, which removed barriers that would have otherwise prevented them from more fully engaging in their work.
5. Employers as gateways to education
According to the 2022 Edelman Trust Barometer, workers trust their employers more than they trust institutions of higher education. This is as much an endorsement for employers as it is an indictment against colleges and universities, which have struggled to keep pace with the needs of a rapidly evolving workforce. Employers can fill this void, working to upskill and re-skill their incumbent workforce through tuition benefits, paid apprenticeships, internships and other avenues that promote learning without disrupting careers and earnings.
As the COVID-19 pandemic demonstrated in startling fashion, it’s impossible to completely predict the future. But it’s also becoming clear that some trends are very much here to stay. Questions about how individuals can make a living while investing in themselves and their future will remain a central concern. Employers must prepare now for a future of work where workers pursue not only family-sustaining wages but autonomy, self-stability and purpose.
This article was written by A.J. Hess from Fast Company and was legally licensed through the Industry Dive Content Marketplace. Please direct all licensing questions to firstname.lastname@example.org.