This is because of a looming recession and the cost-of-living crisis.
Why You Should Care
- A recession is on the horizon.
- And it is turning the tables on who has power in the job market.
- According to Harris Poll, employers are gaining more leverage around pay and benefits.
The ‘Great Resignation’ is over a year old now, and it has pushed employers who want to keep their top talent, as well as attract new workers, to get in line with employee and job seeker preferences.
But a looming recession, a cost of living crisis, and headlines about layoffs have started to turn the tide and pushed some of the power in the job market back towards organizations.
A study of 2,000 US workers by the Harris Poll (on behalf of Bloomberg) found that 58% of workers believe companies have the upper hand in the job market. This is up 9 percentage points on January figures.
The proportion of Gen Z workers who believe that employers have more leverage is 74% – this declined to 66% for millennials, 58% for Gen X, and 46% for Boomers.
Ultimately, economic uncertainty is having a knock-on effect on employees’ boldness in asking for better benefits, including pay and the ability to work remotely.
59% told Harris Poll that although they would like a raise in line with inflation, they didn’t feel comfortable asking for one.
In good news for employers like Apple, Disney, and Peloton who are calling their employees back to the office at least part of the week from Labor Day (Monday 5 September), workers are slowly getting on board.
Only 51% said they thought they could negotiate to continue working from home (at least part of the week) without fear of repercussion.
Further, 62% told the Harris Poll that the economic uncertainty was the reason why they wouldn’t look for a new job in the coming month. The figure was even higher for Gen Z and millennials.
Employees haven’t lost all their power
Of course, the situation isn’t all doom and gloom for employees; they still have a lot of power.
Six in ten said they would look for a new job with better pay, and over half said they have successfully used a new job offer to get a pay raise.
This figure is unchanged from January 2022 – and increased 9 percentage points for Gen Z to 71%. 68% of millennials had used a job offer as leverage for a pay rise – the figure was 50% for Gen X and 26% for boomers.
Talking about the survey, CEO of Harris Poll John Gerzema commented: “It’s a little bit of a game of chicken.
“The calculus is: I either want to lock in greater pay right now by asking for a raise or moving to another job to get a raise. However, being worried about a recession, I’m now also consciously thinking about my job security.”
While the economic situation may have put some employees off leaving their current jobs, employers must not take workers for granted during a recession.
Ultimately, employees will remember that they were treated badly, and probably look to leave as soon as they feel more financially secure.
Instead, now is the time to step up and show employees you care about them and their financial security. This could be through pay rises, or by switching up your employee benefits or offering a bonus.