It’s common for all types of relationships to experience “power swings” — when one person or entity holds more sway over another, for a wide variety of reasons. We have witnessed this phenomenon recently in the job market.1
Starting during the Great Recession and for several years thereafter, many individuals lost jobs and unemployment levels were high. This meant workers who had jobs may not have had a lot of power; if they didn’t like their situation it would be difficult to just quit because jobs were scarce. Candidates applying for jobs didn’t have much leverage in negotiations and therefore wage levels remained stagnant. 2
But in recent years, that balance of power has shifted. Unemployment has dropped and employers must actively recruit and compete for talented employees while finding ways to retain their current base of workers. Meanwhile, employees are using their newfound power to demand better wages, benefits and working conditions. While membership in labor unions is historically low, workers have found new ways to flex their muscle to wield influence over America’s employers. 3
In 2017, there were seven large-scale strikes by U.S. workers; in 2018 there were 20. What has changed? Workers are using social media to spread their message, including photos and videos to publicize their demands, walk-outs and online petitions. Technology has given a voice to disenfranchised workers, allowing them to organize, assemble and generate news stories that motivate employers to act or risk public relations nightmares.4
The Great Recession was a pivotal reminder that employer loyalty may not be what it was previously. Defined benefit plans are on the way out and their defined contribution replacements do not provide the guaranteed lifelong security of a pension. If you’re looking for ways to create a strategy for retirement income using your accumulated assets, please give us a call. We can walk you through what options are available today.5
What’s interesting about this workplace power swing is that employers are well aware they have their work cut out for them. A recent study revealed that 87 percent of human resources managers recognize that retention will remain a critical priority throughout the next five years. One reason is because it is so much more expensive to replace an employee than to keep a current employee happy. Replacement rates can run anywhere from tens of thousands of dollars to twice the lost worker’s annual salary. The cost is even higher when you take account for soft skills and acclimation to workplace culture that are often the keys to success — and come primarily from time spent with a single employer.6
Another survey found that 60 percent of American workers are planning to look for a new job in 2019. Companies that would like to attract today’s up-and-coming leaders must be willing to embrace more than just gender, race and sexual orientation diversity. They must also accept a wide variety of ages, educational levels and geographic locations to support a flexible work culture. 7
The deep and vast millennial workforce has developed specific needs very different than the benefits held dear by older employees. Workplace benefit trends in millennials lean toward financial incentives, including student loan assistance. This new technology-enabled generation also values more paid time off and flexible work arrangements such as the ability to work from home.8
Technology plays a key role in recruiting and retention, with 71 percent of employers acknowledging that their workers are more technologically proficient than the overall organization. Businesses are investing in ways to accommodate worker needs by using technology to: 9
- Eliminate mundane tasks
- Enable the ability to work offsite
- Enhance current hiring and negotiation capabilities
- Use virtual reality platforms for training purposes
According to the 2019 Global Talent Trends Report by LinkedIn, one of the newest workplace trends is facilitating pay transparency. More than half (53 percent) of professional recruiters report that giving job candidates and current workers access to know employee salaries for pay negotiation purposes is the wave of the future. In fact, classifying job skills and experience with a static pay scale — instead of basing wages on previous salary history — will help streamline negotiations to make hiring faster and easier.10
Our firm assists retirees and pre-retirees in the creation of retirement strategies utilizing investment and insurance products. Advisory services offered through B.O.S.S. Retirement Advisors, a Registered Investment Advisory firm.. Insurance products and services offered through B.O.S.S. Retirement Solutions. Marketing materials provided by Infinity Marketing Services.
1 U.S. Bureau of Labor Statistics. Jan. 18, 2019. “Union Members – 2018.” https://www.bls.gov/news.release/pdf/union2.pdf. Accessed Feb. 11, 2019.
4 Janet Paskin. Bloomberg. Feb. 7, 2019. “The Resurrection of American Labor.” https://www.bloomberg.com/news/articles/2019-02-07/facing-limitless-corporate-power-u-s-labor-finds-ways-to-win. Accessed Feb. 7, 2019.
5 Gradifi. “The Cost of Turnover vs. the Value of Progressive Benefits.” https://notebook.gradifi.com/workplace-trends/the-cost-of-turnover-vs-the-value-of-progressive-benefits. Accessed Feb. 7, 2019.
7 Zoe Harte. Forbes. Jan. 30, 2019. “The Future Is Now: Three HR Trends That Will Transform Your Organization In 2019.” https://www.forbes.com/sites/forbeshumanresourcescouncil/2019/01/30/the-future-is-now-three-hr-trends-that-will-transform-your-organization-in-2019/#4a219c12e9ce. Accessed Feb. 7, 2019.
8 Nadine El-Bawab. CNBC. Feb. 7, 2019. “More millennials are demanding these workplace perks.” https://www.cnbc.com/2019/02/07/millennials-are-demanding-these-workplace-perks.html. Accessed Feb. 7, 2019.
9 Tom Popomaronis. Inc. Feb. 7, 2019. “A Survey of 6,672 Executives Reveals the Biggest Tech Trends Poised to Disrupt Businesses Within 3 Years.” https://www.inc.com/tom-popomaronis/a-survey-of-6672-executives-reveals-biggest-tech-trends-poised-to-disrupt-businesses-within-3-years.html. Accessed Feb. 7, 2019.
10 LinkedIn. Jan. 28, 2019. “LinkedIn Releases 2019 Global Talent Trends Report.” https://news.linkedin.com/2019/January/linkedin-releases-2019-global-talent-trends-report. Accessed Feb. 7, 2019.