Reimagining work, pay and benefits during major crises and the Great Resignation

At the same time the geopolitical crisis in the Ukraine confronts business leaders with difficult questions on how to respond to an array of challenges, other significant crises from the past year are not abating.  Leaders continue to manage threats that include variants of COVID-19, financial shocks, climate events, severe labor shortages, wage inflation, and supply chain disruption. To succeed, future-seeking leaders recognize the impact on their workforce and address the risks by rethinking work, pay, benefits, careers and wellbeing amidst what many continue to call the Great Resignation.

A new global survey of 1,650 employers representing 11.9 million employees reports that talent challenges across all employee categories are expected to continue in 2022. Specifically, 70% of organizations acknowledge trouble attracting employees generally; more than three-quarters of employers (78%) cite problems attracting or retaining digital talent, and roughly half report difficulties hiring or keeping employees in salaried (56%) and sales (48%) positions.

In the face of sweeping workplace changes, organizations are shifting priorities across several key areas:

1. 01

   Optimizing work design

   Flexible work is no longer a differentiator - it is table stakes. While flexible work may vary substantially by industry or country, in the aggregate it is becoming more pervasive. While fewer than 10% of employees worked remotely or a mix of remotely and onsite three years ago, half of employees are doing so today. That number is expected to remain steady over the next three years. Over half of employers indicate that factors driving the most change include where work gets done (i.e., onsite, hybrid, remote) and the amount and type of work completed using automation, artificial intelligence and digitalization. Employers that are taking action in work and job design report that the following have driven extensive changes within their organizations: new sources of talent, growing importance of multi-skilling, perceived changes in employee preferences, and greater emphasis on diversity, equity, and inclusion (DEI).

2. 02

   Resetting philosophy around Total Rewards (pay, benefits, careers and wellbeing)

   A mix of workplace challenges and business issues (including disruption to supply chains and labor markets and increasing emphasis on wellbeing and DEI) are prompting organizations to reset the core elements of their Total Rewards philosophy and programs, i.e., pay, benefits, careers, and wellbeing. While base pay/salary, bonus or other short-term incentives and health and wellbeing programs typically are part of a core Total Rewards offering, high-performing organizations are inclined to take a more comprehensive view that better meets the needs and preferences of their diverse employee population and addresses attraction and retention pressures. As a result, leaders of high-performing organizations think expansively and incorporate company stock or other long-term incentive programs, career growth initiatives, retirement and wealth-building benefits, flexible work, voluntary benefits, skill building, caregiving support, and other programs into their core offering as appropriate, supported by a strong employee experience.

   In resetting their Total Rewards philosophy, future-seeking leaders take the following actions:

   • Recognize that physical, emotional and financial wellbeing programs need to change to support employees in a more flexible and agile workplace.
   • Review the mix of pay and benefits to reflect the change in use of remote/hybrid work or other flexible work arrangements.
   • Consider how issues of gender pay equity or fairness for diverse employee populations affect individual pay increases (high-performing organizations are about 80% more likely to say concerns over gender pay equity or fairness for diverse employee populations drive individual pay increases).
   • Create a road map to drive environmental, social and governance (ESG) and DEI goals through Total Rewards.
   • Reimagine the employee experience as it relates to Total Rewards.

3. 03

   Defining careers

   As employers embrace flexible ways of working, they are defining careers for a reconfigured, agile workplace. They tackle priority areas where they have experienced extensive change, including multi-skilling, employee wellbeing and supply chain disruptions. High-performing organizations are almost 60% more likely than low-performing organizations to have redefined the meaning of careers while adopting new ways of working; 62% of organizations plan to focus on redefining careers in the next three years. To effectively define careers, future-seeking leaders take the following actions:

   • Reduce layers. Roughly half of companies have already completed or are planning/considering actions to reduce layers within the organization. These actions typically result in increasing the number of direct reports for the remaining managers.
   • Advance skills-based placement of work. Almost two-fifths of employers indicate that the use of skills-based placement of work will be a significant factor in how their organizations change their ways of working over the next three years.
   • Provide more flexibility in career options as a means of enabling career progression for individual contributors and managers. High-performing organizations are 2.4 times as likely to have taken action in this area.

To propel their organizations forward, leaders shape new strategies and solutions around work, pay, benefits, careers and wellbeing, unleashing the performance of their people regardless of what the future brings.

A version of this article originally appeared on Forbes.com on March 17, 2022.

Author

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John M. Bremen

Managing Director and Chief Innovation & Acceleration Officer

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