Businesses offered remote and hybrid work choices. Some provided flexibility, allowing people to decide where and when they’d like to work. Digital nomads were permitted to do their tasks anywhere in the world. If a person wanted to relocate from a high-cost city to another location, management allowed the worker to earn the same amount of compensation, despite the lower cost of living. Businesses offered resources and benefits to help with their staff’s mental health, emotional well-being and avoiding burnout.
Seemingly overnight, the mood has dramatically changed. As inflation raged, wreaking havoc on the economy, along with other geopolitical and macro events, thousands of people were downsized, hiring freezes put in place and job offers rescinded.
The Federal Reserve Bank announced that it will raise interest rates. This will make the costs of loans, credit cards and mortgages significantly increase. It becomes another large tax on the American consumer.
The reversal in fiscal policy, going from flooding the economy with trillions of dollars in stimulus programs to a quantitative tightening, harms corporations and startups that benefited from cheap money. The result will likely be a recession. When the economy contracts, companies need to cut costs and letting go of employees is an unfortunate go-to strategy. The tech and cryptocurrency sectors have already seen thousands of layoffs. It has spread to the mortgage division of top-tier investment JPMorgan and real estate-related companies.
Job Postings Are Declining And Layoffs Are Growing
The plummet in stock and cryptocurrency prices has spooked investors. The American people have pivoted from a feeling of euphoria to fear about the future health of the economy and job market. It’s natural for companies to start questioning if they really need to add to staff. Many executives will only want to hire when it is absolutely necessary. CNBC reported that job openings fell by nearly half a million in April. Job listings on Indeed, the large job aggregation site, are down from their previous highs. Bloomberg reported that Amazon and Walmart are letting people leave and not replacing them.
There has been a brutal public backlash against companies that have rescinded job offers. Learning from the mistakes of companies, such as Coinbase, job seekers will likely see a slow-walking of interviews. Human resources will take their time to hire, as they don’t want to be put in the situation of having to renege on a job offer or hire someone and be forced to let them go after only a short period of time.
Companies may prefer bringing aboard contractors and gig workers. These folks are not full-time employees, generally don’t receive benefits and could be told that their services are not needed at a moment’s notice.
Will Companies Push For Workers To Return Full Time To The Office?
Although most employees want to work remotely, or at least in a hybrid fashion, managers are not all on board. It is challenging for managers to oversee a distributed workforce across the nation and in other countries. For many supervisors, it’s easier for them to have everyone under one roof.
A study conducted by the Society for Human Resource Management (SHRM) found that supervisors are not happy with remote work. They reported “negative perceptions” of the work-from-home trend and said they’d prefer their staff to operate from an office setting.
The managers who responded to the survey were brutally honest. Nearly 70% replied that remote workers are “more easily replaceable than onsite workers.” About 62% contend that “full-time remote work is detrimental to employees’ career objectives and 72% say they would prefer all of their subordinates to be working in the office.”
Using The Threat Of Returning To An Office As A Way To Downsize
When companies announce layoffs, it’s never a good look. It makes it seem like the organization is undergoing serious problems. Employees, vendors and consumers wonder if there is something else going on behind the scenes. For management, layoffs may feel as if it’s an admission that they haven’t properly run the company.
This may have been the tactic recently utilized by Elon Musk, the CEO of Tesla. He publicly rebuked his staff telling them to get back to the office or leave and work elsewhere. The threat could inspire staff to leave of their own volition. On Tuesday, at a Bloomberg event, Musk announced that Tesla plans to reduce 10% of its salaried workforce within the next three months.
Real estate is very expensive. Companies that have a hybrid or in-office model may decide to jettison their office space to cut costs. Yelp, the platform that publishes crowdsourced reviews about businesses, reported that it will no longer be a hybrid workplace. The restaurant review app said it will shut down its offices in major cities and offer a remote work model for its 4,000-plus employees. Other tech companies, such as Airbnb, Twitter and Slack, have adopted remote-first programs as well.
What You Need To Do Now
During the Great Resignation, people were quick to quit their jobs. They did not worry too much, since it was a hot job market. Their mindset was that they could easily find another job. You cannot think or conduct yourself this way any longer.
If you are considering switching jobs, give it much consideration and careful thought. Thoroughly research your target company. Look for any hints that there could be future layoffs. Find people who work at the company and ask their opinions on whether or not it’s a safe place to work. If you are using the services of a recruiter, grill the person to learn everything about the organization, so you won’t later regret the move.
You may want to hold off on searching for a new job—unless you’re in jeopardy of being laid off. For the foreseeable future, you need to become indispensable. You want to be viewed as the go-to person who can get things done. Raise your hand for new assignments and tasks. Make sure that your boss and management are aware of your contributions. Be the person who is always positive, enthusiastic and motivated.
There is also a need to have a “just-in-case” plan. Seek out recruiters who specialize in your field. Be honest and let them know that you want to stay with your company, but due to the uncertainty, you should ask if they can keep an eye out for new opportunities. Get in touch with career coaches and résumé writers to help you prepare for interviews. Tap into your network and let everyone know that, while you’re relatively happy where you are, you’d appreciate any leads on new jobs, in case things go south at your office. Save and put aside money, in case the economy worsens or you’re downsized and it takes a while to find a new position.