Looking Back at 2023:

With 2024 around the corner and Covid’s debut increasingly in our rearview mirrors, Peoplescape reflects on the evolving hybrid and remote work landscape. In just three years we have gone from uncharted waters to ‘The Great Compromise,’ a delicate dance between employee demands and employer needs. This clash between leadership and employee mindsets and expectations gets even more challenging when seen through the differing lenses of Baby Boomers, Gen X, Millennials (Gen Y), and Gen Z – all in one workplace, sprinkled with residual pandemic trauma on top. In this post, we share our top takeaways for 2023 and provide pragmatic recommendations for business success in the new year.

Expanded Employee Expectations

In a world that’s increasingly complex, employee wellbeing remains a priority for hybrid and remote work companies. But what constitutes wellbeing?

Physical and mental wellness needs are better understood these days, but the needle keeps moving as the loneliness pandemic continues and burnout surges. A full 60% of recently polled U.S. employees are stressed due to social, economic, and financial tumult, claim Heffelfinger and Freedman in their November 2023 paper “Getting Hybrid Work Right! Reduce Your Productivity Concerns.”

In fact, financial wellness has gained importance within employee expectations.

Mercer’s 2023-2024 Inside Employees’ Minds© report shows employees increasingly looking to employers to help them manage financial turbulence by improving employer contributions towards health-care premiums and retirement plans.

While businesses tend to view their employees as a collective, the employees themselves expect management to support them as individuals. “There are nuances by generation, market, and DEI factors, reminds James Kinney, an Advertising C-suite HR leader and mental-health motivator on Peoplescape’s Advisory Board.

This growing list of employee expectations is hefty, regardless of a business’ health. And with talent shortages widespread and unemployment at historic lows, employers seeking to attract and retain top talent cannot afford to ignore these shifting expectations without facing painful consequences.

 

The Productivity Picture Clarified

After monitoring dropping productivity throughout the first half of 2023 – surprise! – the US Labor Department announced Q3 had the strongest uptick in employee productivity since 2020. And get this: new research reflects that productivity peaks primarily in remote offices. Yet the news cycle is filled with concerned leaders pushing for returns to the office and synchronized schedules. What’s going on?

 

Mind the Gap

Here we arrive at the heart of The Great Compromise. Businesses with a remote component are showing strong productivity and employee satisfaction with the new status quo. Meanwhile many successful, savvy leaders are pushing for returns to some or all of the old ways of working. Both sides of this equation are on edge and scratching their heads in puzzlement.

We believe both perception and reality are in play. Employers and employees crave more – more support, more success, more investment. Yet they now stare at one another across a divide.

One of the biggest factors driving this divide is that stressed leadership – the majority of whom are Gen X and northward – tend to lean into what’s familiar as they wrestle with uncertainty and instability. Here, that desire for a return to familiarity translates into a conviction that in-office working boosts teams’ collaboration, innovation, efficiency, and productivity.

On the other side of the gulf, junior to middle-management employees (mostly older Gen Z and Millennials at present) perceive return-to-work mandates as signs of distrust and micromanagement. Frustration further escalates for this generation, given their prioritized value for sense of purpose, belonging, growth, well-being, lifestyle, and psychological safety. For them, even the inviting ‘yoga lunch sessions’, fully stocked kitchens, and Wednesday lunches cannot stack up.

All of this translates into frustrations for all. But we bear good news! This shifting workscape provides an incredible opportunity for leaders to up their game.

“Being in an office all the time (pre-Covid) masked a lot of ineffective management, which was brought to the surface when we moved to remote working,” commented Tina Robinson, CEO of WorkJoy and a Peoplescape Advisory Board member. “Nostalgia doesn’t equal optimal. When looking into the year ahead, let’s call this The Great Reset, rather than The Great Return.”

We at Peoplescape want to take this theme even further and suggest that we all recast The Great Compromise as part of The Great Reset. Businesses should take advantage of this extraordinary opportunity to embrace 2024 as a time to build bridges that improve productivity, culture, and morale through a handful of thoughtful – and affordable – methods.

Next Up: 2024!

We’ll dive into those best practices in our next blog entry, which shares our top practical recommendations for setting your hybrid workforce and your business up for even greater success. In the meantime, we wish everyone a happy and healthy New Year!