“The rising cost of living is likely to put more people off changing jobs this year, leading to slower wage growth.” That was the view of Gabriella Dickens at Pantheon Macroeconomics at the start of this year, back when cost-of-living concerns had yet to explode into a full-blown crisis.
This was good news for employers, who had spent much of the previous few months reading about the ‘Great Resignation’, a generation of workers emboldened by 18 months of on-off lockdowns deciding now was the time to seek better conditions and a better work/life balance.
As supply chain issues continued to affect inflation, so the conventional wisdom said, more workers would stay put in 2022.
Then Ukraine happened.
In May, the BBC reported a PwC study that found almost one in five UK workers were likely to change jobs in the next 12 months. This was an advance on a study a month earlier which found three in four were thinking about it.
Far from putting the brakes on the ‘Great Resignation’, the sheer ferocity of price hikes seen across sectors has led workers—particularly young, skilled workers—to seek a raise or look to switch jobs.
Voting with their feet
Employers can ill-afford to pay inflated wages to retain and recruit talent. Employees can ill-afford not to go in search of improved salaries.
Something has to give, but what is certain is that the ‘Great Resignation’ hasn’t gone away.
How should employers respond? The PwC study found 60% of employees would prefer to work fully or mostly from home. Only 17% said they would prefer to be working full-time or mostly in the office.
Sarah Moore, people and organisation leader at PwC, is quoted by the BBC as saying: “Temporary solutions to business problems, such as hybrid working, have turned into employee preferences and expectations.”
It’s clearly not possible for every business, but where hybrid working is an option, it seems that offering it may help to reduce employee turnover and help you recruit.
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