Our 2023 Workplace Predictions

Here we are at the beginning of another year, and that means it’s time for The Workforce Institute’s annual list of Workplace Predictions.

Each year, our advisory board of experts convenes to discuss the most pressing workplace challenges impacting not just HR, but organizations and their people. Together, they strive to forecast what’s ahead in the coming year — to help companies effectively prepare, navigate change, and better serve their employees and customers.

While traditional work has changed in many ways over the past few years, mainly due to the pandemic, one constant has remained: The most compassionate and caring companies stand to benefit the most through, maybe even despite, times of uncertainty. There are several outside factors currently affecting employees, from mental health to natural disasters to social unrest to the economy, and companies can play an influential role in improving work and life for their people.

As workers and companies start to find their working rhythm in 2023, respect for all people — and valuing the differences and dynamics that come with each individual person — will become key to recruiting and retaining top talent, building customer relationships, and fostering business success.

With that in mind, here are five workplace predictions for 2023:

ROI of DEI&B: Companies that invest in DEI&B programs during tough times will see better business results, while those who cut fall behind. In 2022, The Workforce Institute predicted that corporate environmental, social, and governance (ESG) programs would emerge as a make-or-break asset for business stability and growth. As a continuation of that prediction, DEI&B as a business imperative will reach the next level this year. Many leaders have pledged to do more to improve DEI&B at their organization, or to launch a program altogether, and employees and customers increasingly prefer to work for or do business with companies wholly committed to meaningful DEI&B. Equity in its many forms, from recruiting to wages to opportunity, is better for all people. In 2023, we will see more proof that DEI&B is also better for the bottom line. Organizations that double down on DEI&B — even in the hardest of times, such as during a recession — see better returns on their investment, and a greater sense of belonging for people will help boost retention and engagement, as the unending war for talent wages on.

Metrics That Matter: The best leaders will “show their work” to gain greater buy-in from employees, especially with returning to the office and making difficult decisions. Schoolchildren are often asked to “show the work” when solving problems. In the year ahead, businesses and leaders who do the same by showing the data and metrics behind their decisions will foster greater loyalty, trust, and productivity from their people. Even if employees don’t always like or agree with the decisions made, the best leaders will be celebrated for providing greater transparency into the why behind decisions and company strategy. This will be key for tackling 2023’s challenges, including encouraging employees back to the workplace after a rise in, and increased preference for, remote and hybrid work schedules.

A Heroes’ Exit? Workers who hold on to service-oriented, essential roles — such as HR, healthcare workers, retail, and teachers — will be rewarded as many of their peers search for new careers. Organizations have asked a lot of people on the frontlines these past three years. Those workers who’ve continued to show up throughout the most trying of times will consider leaving, creating a second wave of the Great Resignation in their wake. Likewise, HR professionals have carried additional responsibilities as more and more employees have left, and many have burned out and grown weary of the original reason they joined HR in the first place — to help people. Those who decide to stay could be rewarded for their loyalty, in the form of promotions and wage increases. Organizations need to start planning now for what happens when more employees, including HR, leave en masse. This includes cross-training new and existing employees, reskilling talent, diversifying recruiting efforts, and keeping an open mind about the transferability of skills.

People-Leader Paradox: Middle management roles become increasingly valuable to the organization, though the job will be less valued and sought-after by many workers. Being a middle manager is one of the hardest roles in the workplace today — and many workers no longer want to take on the added stress and strain of managing people. Some people leaders will even take demotions and move back to individual contributor roles with a pay cut, if it means better mental health and less overall responsibility. In 2023, capable and passionate managers will be in high demand, as organizations scramble to fill leadership vacancies amid rising disinterest in the role. This will create a “people-leader paradox,” as organizational demand for leaders increases and employees’ desire for the role decreases.

Compliance Correction: The hidden costs and compliance complexities of remote and hybrid work will have major financial ramifications on both organizations and their employees. After mostly flying under the radar since 2020, companies and their people will start to feel the financial impacts of previously unforeseen costs, legalities, tax implications, and compliance requirements around the world that come with a more flexible, remote, and hybrid workforce (e.g., people working in different countries than their employers, working part time in one location for months at a time). Employees, too, will have to pay closer attention to what they owe the governments in the countries, states, and counties where they live and work, lest they end up paying more taxes than originally expected. Organizations and their employees will need to consider the short- and long-term financial implications of their workplace policies and programs.

There’s obviously a lot to unpack here. The Workforce Institute advisory board will continue to explore these workplace predictions in full as we progress into the new year, as well as share insightful perspectives and best practices for addressing these challenges head-on.

On behalf of The Workforce Institute, here’s to a productive, rewarding, and fulfilling 2023!