The world of work moves fast and keeping up can be a challenge. From pay transparency and quiet quitting (and firing) to layoffs in the tech sector, 2022 proved to be another transformational year at work. So before we ring in 2023, let's unpack the top workplace takeaways that affected employers and employees over the past year.
3 key workplace moments of 2022
1. Pay transparency and organizational trust
On November 1, the pay transparency law to promote equal pay for equal work took effect in New York. It requires employers to provide good-faith salary ranges for job openings.
From data collected in 2020 by the Bureau of Labor Statistics, women earned 83 cents for every dollar a man earns. The pay gap is even wider for women of color with Black women being paid 64% and Hispanic women 57% of what white non-Hispanic men were paid in 2020. The pay transparency law aims to address the wage gap and ensure pay equity by demanding recruiters disclose pay scales for jobs titles.
Results from a Gartner study show that only 32% of 3,500+ workers surveyed believe they are fairly compensated. Since most employers from this study put pay equity as a high priority, this perception may come from a lack of organizational trust rather than a company’s commitment. Better pay transparency can lead to higher organizational trust, however a September study showed that nearly one third of employers said their organization was not ready for pay transparency.
What this means for employers: To increase organizational trust, you should increase transparency and engagement within your company. 35% of employees state that increasing transparency of salaries across the organization is one of the most important ways to achieve pay equity, leading to increased organizational trust. Complete routine pay audits, training, and increased resources to demonstrate the organization’s commitment to pay equity.
Yes, and: Many pay transparency laws will go into effect January 1, such as for California and Washington, joining states like Colorado and New York. Employers in other states should be prepared for similar laws to start going into effect in 2023. Employers must ensure that all demographics of their workforce have access to the same information, especially information tailored to their needs. This, combined with pay transparency, will lead to a more engaged and productive workforce.
2. Quiet quitting (and firing)
Back in August, the “quiet quitting” trend, where employees psychologically withdraw from their work and decrease engagement, made headlines. Over the past few months, we are now seeing the other side of the picture known as “quiet firing.”
Quiet firing is when managers stop providing coaching and mentorship to employees, ultimately pushing the employee out of the company. These managers may not intentionally be doing this; however, their lack of leadership causes an employee to quit.
As shown in a Gallup study, only 37% of managers strongly agree that they invest in their employees’ development, and only 25% of employees strongly agree that their manager invests in their professional development. The way an employee feels about their professional development within an organization influences their want to stay, and a manager’s leadership plays into that.
What this means for employers: To facilitate growth and maintain healthy relationships, employers must keep open and honest communication with employees. Employers must be open and transparent with employees to keep them in the loop, increasing trust. Additionally, employers should make a regular effort to provide feedback and support to encourage employees to increase their engagement. Providing training, resources, and open communication about job duties and development helps foster a positive work culture so issues that lead to quiet quitting do not arise.
Yes, and: Quiet firing often happens due to personal conflicts, mismanagement, confusion on duties, etc. These are all very valid concerns that happen in the workplace; however, they need to be managed properly to prevent harm to the relationships or company. Maintaining open communication when there are changes to duties and responsibilities will prevent you from “quiet firing” your employee. Following the above tips will allow an organization to build trust with their team and increase productivity.
3. Tech layoffs versus a tight labor market
Over the past few years, the pandemic has made attracting and retaining talent a huge focus, especially in the early months of 2022. Due to the skill gaps, changing demographics, competition, and economic disruptions, the first half of 2022 saw a war for talent. In March of 2022, unemployment hit 3.6% in the U.S with companies looking to hire thousands of people to facilitate growth. Employers had to improve the employee experience from recruiting processes to benefits offered.
Coming into the second half of 2022, we have seen an increase in layoffs in the tech sector. It is estimated that over 120,000 people in 2022 have been laid off from some of the major tech companies. This is due to revenue losses, over-hiring, and even imitative behavior from some companies.
Yes, but: On the other hand, frontline workers in service jobs, hospitality, and healthcare are still in high demand. According to data released by the U.S. Bureau of Labor Statistics, the U.S. economy created 263,000 new jobs in November 2022. This is particularly seen in healthcare and service industries, where the market still has not reached a post-pandemic “normal.”
What this means going forward: Due to the tale of two job markets, laid-off workers still have a chance of finding new positions. There has been an increase in tech layoffs but employers in other industries are still struggling to retain talent. It is important for employers to continue best practices to retain talent as there is still uncertainty moving into 2023.
Prepare for the latest trends and help your organization stay ahead of the curve with the 2023 Megatrends report.
Join Julie Develin, Senior Partner of the HCM Advisory Group at UKG, and Karina Monesson, Senior Manager of Research and Advisory at UKG, on Wednesday, January 18, as they explore three major trends expected to impact organizations on a global scale in 2023.
