Earlier this month, Elon Musk declared something that, a few years ago, wouldn’t have raised an eyebrow: Tesla employees must “spend a minimum of 40 hours in the office per week.”
In 2022, that’s a controversial thing to say.
The world of work is rapidly changing, and the shift to remote work is only one facet of the transformation. From the rise of independent contractors to the flexibility imperative, the blueprint for the workforce of the future is being redesigned in real-time.
Lots of things are happening at once. We’re in the midst of a “white-hot” labor market. And yet tech companies are laying off 10%, 15%, even 20% of their workforce. Simultaneously, we’re seeing the highest inflation rates in four decades.
It raises a lot of questions about the new post-lockdown reality: Why are people still quitting in record numbers? How are workers re-evaluating their priorities?
Here are five charts that provide some clarity in the chaos.
1. Tech layoffs are hitting again—but highly-skilled workers are still in the driver's seat
Q2 of 2022 layoffs.fyi counted over 20,000 startup layoffs. This comes just two years after 2020’s COVID tech reckoning, where Q2 layoffs topped 60,000.
And with several companies valued at unicorn status just one year ago—including Cameo and Loom—cutting back their staff by more than 10%, the formerly frothy startup sector appears to be calming down in the face of a potential downturn.
That said, hiring has not slowed down, according to recruiters, with top tech talent still in high demand. Those getting laid off are getting job offers thrown into the comments on LinkedIn post announcing their departure.
Meanwhile, 4.4 million Americans voluntarily left their jobs in April, amounting to some of the highest levels since 2000. It’s a trend that doesn’t show signs of letting up.
2. Independent work is starting to feel more stable than a full-time job
Traditional full-time employment is losing one of its core appeals: stability.
A survey by MBO Partners featured in the Harvard Business Review revealed that nearly 70% of polled independent workers reported feeling, “more secure working independently.“ That's an increase from 32% in 2011 and 53% in 2019.
But their research uncovered another striking phenomenon about the perception of independent work. Among full-time employees, roughly 30% agreed that independent work was more stable than their current job. This offers yet another explanation as to why so many salaried employees are striking out on their own.
3. Americans are losing faith in their employers
In May of 2022, worker confidence saw its steepest drop since the onset of the pandemic.
What’s driving this dynamic? As George Anders, a senior editor at LinkedIn, describes, “There’s a new restlessness in the workforce, expressed in everything from greater job-hopping to a surprising reluctance to return to (reopened) offices.”
Wages and prospects for top executives remain high. But creating real excitement about companies’ long-term growth—for all employees, not just a few key decision-makers—is harder now.
4. People are quitting because of low pay—plus a lack of advancement and respect at work
While well-resourced companies are still flexing their muscle to dole out cash incentives—including headline-grabbing, $100K bonuses from the likes of Apple—insufficient compensation is still the main driver of resignations. Workers also cite “no opportunities for advancement,” “disrespect,” and “not enough flexibility” as major reasons for leaving full-time positions.
Can large firms bake these sometimes-intangible benefits into the modern workplace? It remains to be seen. But given the increasing visibility of roles like Chief Wellbeing Officer and new imperatives on unlimited paid time off, it’s clear that cash doesn’t solve everything.
5. The alternative workforce is growing quickly—and not just in IT
The alternative workforce—which encompasses contractors, gig workers, freelancers, and crowd workers—is now essential across sectors.
Whereas the alternative workforce was previously perceived to be confined to IT and ‘repeatable tasks,’ Deloitte’s Global Human Capital Trends report found alternative workforce growth in fields ranging from marketing to HR and operations.
With the normalization of hybrid and remote teams and higher percentages of US adults gaining experience as contractors, the alternative workforce is likely a permanent fixture of the modern economy.