Uncertainty Rules the Workplace as Employees Quit and Companies Freeze Hiring, Rescind Offers

Down Economy

Today’s workplace is, to say the least, uneasy. The economy’s unsettled and the dynamics that appeared in the wake of Covid-19 has forced HR departments to juggle the often conflicting needs of the workforce and the C-suite.

According to performance management platform provider 15Five, one-third of workers plan to quit their jobs despite the potential for an economic downturn. At the same time, nearly one in five employers plan layoffs, while more than a third have rescinded job offers.

One-third of workers plan to quit their jobs despite a looming economic downturn, while nearly one in five employers plan layoffs. More than a third have rescinded job offers. #HFR #HRTech @15Five Share on X

“We are seeing economic shifts driving some companies to downsize their workforces, especially in the tech sector, while other businesses are still dealing with high attrition and difficulty hiring in a competitive labor market,” said Jennie Yang, 15Five’s vice president of People & Culture.

In the survey, employees said work-life balance is a top concern, ranking behind only pay and health benefits. For their part, HR leaders said balance was the most important concern to their workforce, followed by health benefits and growth opportunities.

HR and employees agreed they want downtime to be honored. Asked if they could change one thing about today’s work environment, the No. 1 response for both groups (21.9% of employees and 20.8% of HR professionals) was to have personal downtime respected.

HR is actively looking into creative options to resolve the work-life balance and disappearing downtime conundrum, the survey said. One option picking up steam in organizations with more than 500 employees is the idea of a four-day workweek. Nearly 60% of HR leaders report they expect to transition to shorter weeks.

Attrition Slows Down but Continues

If there’s an economic downturn, expect attrition rates to slow but not stop, the survey said.  While most employees (56%) said economic factors would influence their decision to leave, nearly one-third are still either planning or considering quitting in the next six to 12 months. The risk that fewer jobs may be available didn’t change their minds.

During the first half of 2022, 44% of HR leaders reported that more employees left their company compared to the first half of 2021. 15Five said the top reasons employees leave are a desire for better pay, because they feel stressed and burned out, and they want flexible work options.

Meanwhile, nearly one in five HR leaders said they’re planning on implementing layoffs, with solid majorities acknowledging that the economic downturn has significantly impacted revenue (59.8%) and their ability to hire (68%). Over one-third (35.8%) said unexpected hiring freezes led to rescinded offers. (Most of the companies reporting they rescinded offers have 500 or more employees.)

The hiring freeze has intensified HR’s efforts to upskill workers, with nearly half (49.6%) planning to introduce manager training and performance management software (46.4%) in the second half of 2022 and after.

HR Leaders are Feeling the Pressure

HR leaders report experiencing pressure from all sides: leadership is imposing financial constraints even though the organization still needs to replace people leaving. That puts HR in the spot of juggling the conflicting realities of the Great Resignation with a possible downturn and resulting layoffs.

Not surprisingly, HR is usually put in the position of informing workers of staff reductions. That’s led 42.2% of HR professionals saying they have anxiety, while 30.2% suffer from burnout and 16.8% quit their jobs.

Image: 123RF

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