Vice President, Global Benefits
The Great Resignation, Stalled
Not long ago—like last month—job hunters seemed to have all the leverage. Nationwide, there were nearly two open jobs for every unemployed person. In some markets the ratio was closer to 3:1.
But interest-rate hikes, a significant stock market decline, and the growing possibility of a recession—according to a slew of economists and corporate leaders—have dented the confidence of many would-be job seekers. “The Great Resignation feels like it’s coming to a halt,” says Brian Bloom, Korn Ferry’s vice president of global benefits.
The pace of new job postings has slowed on various online job sites. Early indications suggest that firms are pulling back on filling open slots. Major retailers have said they are thinning employee ranks through attrition, and some tech firms are actually laying off staff. Candidates have noticed the change, and it’s made some reconsider whether or not they want to make a move, says David Vied, global sector leader of Korn Ferry’s Medical Devices and Diagnostics practice, “Now that they can’t get five offers overnight, some are doing a little circumspection,” he says.
It’s a rapid reversal of much of the last 18 months, during which it felt like employees of all levels were in the driver’s seat. Corporate executives were scrambling to come up with ways to win over candidates and keep existing employees. To curtail the Great Resignation, companies offered better benefits, considerably higher salaries, hefty spot bonuses, flexible scheduling, remote work options, massive counteroffers, and bigger commitments to environmental sustainability. Few requests could be rejected outright, it seemed.
To be sure, the job market is still quite good—and will likely be for years to come with many highly specialized employees remaining in high demand. Now, however, companies are starting to push back on some worker wishes, exorbitant and otherwise. Requests for doubling of existing salaries are, once again, being routinely denied. And whereas some clients were letting new recruits work remotely full-time, now they are insisting those new employees work on-site at least some of the time, says Jacob Zabkowicz, vice president and general manager of Korn Ferry’s Recruitment Process Outsourcing business. Companies aren’t necessarily committed to filling all of their open roles, either. Vied says that an increasing number of leaders are saying that if the company has been operating reasonably well for a year with a particular role open, then perhaps the firm can do fine without that role at all.
Ironically, it’s some of those generous, recently handed-out benefits that are raising red flags for some candidates. Someone who switches employers now to take advantage of a big salary bump may worry that they will be among the first to be laid off if the economy goes south, Bloom says.
Experts caution, however, that firms can’t assume they’ll be able to roll back a lot of post-pandemic benefits. Take remote work—a contentious issue for many leaders. CEOs will need to offer reasons well beyond “because I said so” to draw employees back to the office, says Jamen Graves, global co-leader of Korn Ferry’s CEO and Enterprise Leadership Development practice. “There are millions of workers who have had to figure out how to be highly productive working remotely,” he says. “If you are now asking them to come into the office, there needs to be a compelling reason.”
Firms across industries might not have to offer 20% to 30% raises to stay competitive, Zabkowicz says, but if they want to keep top talent, they’ll need to shell out more than the 3% to 5% raises many doled out for the past decade. At the same time, firms shouldn’t roll back some of the modifications they made during the last two years to speed up their hiring processes. “Speed is still king, and companies need to focus on their brand and image as employers,” he says.