Employment Outlook for 2023

The holidays have officially ended, 2023 is in full swing.  With the start of a new year, the employment outlook for 2023 will include new trends in the labor market. Many of these changes will be a result of having navigated through Covid, and moving forward. Ultimately to discover a place where the pandemic doesn’t completely overshadow all business decisions. 

However, many people who made a substantial pivot also found that work became more interwoven into their lives until a work/life balance was achieved. Employers who understand how these trends  influence the work environment, will be able to prepare for any new challenges when they recruit top candidates.

What are the upcoming employment trends for 2023?

Many of the trends for 2023 are based on employees finding a better way to manage all of their responsibilities as both a worker and a family member. The mental strain of family obligations was previously something that employees dealt with during non-working hours. When the pandemic occurred, the importance of staying healthy, and controlling stress-related illnesses brought a new awareness of how their job affected their lives. With this in mind, many employees are now looking forward to a new type of work environment, including:

Flexibility of Remote or Hybrid Work

According to Zippia, 26% of U.S.employees are working remotely in 2022, and a projected 36.2 million Americans will be remote by 2025. Many of these workers enjoy the flexibility and productivity when not confined to an office environment. They also benefit from the reduction of costs they were spending on commuting. This flexibility tends to give remote and hybrid employees (those who split their time between the office and home), a better well-being. However, they are also experiencing reduced in-person interactions with their co-workers.

Increased Technology Systems that Support the Office Culture

Becoming a diverse and inclusive work environment means that employers typically ensure different standards don’t occur between in-person versus remote or hybrid employees. This encourages companies to employ the latest technology that allows everyone to have real time conversations, including video conferences with robust breakout rooms. This tends to encourage communication and brainstorming to give co-workers a chance to build stronger teams.

Workplace Monitoring Tools

For managers to ensure that projects stay on track, when employees are not in the office, many use monitoring tools to follow productivity.  Many of these tools will track an employee’s activities away from the office, including systems such as:

• Time Trackers – These trackers will typically monitor the start and stop time for each activity that can either be controlled manually by the employee or set automatically by the manager. However, the tasks done are not usually tracked, just the time spent on them.

• Activity Trackers – An activity tracker follows the amount of time an employee spends using each application or email during their workday. Sometimes screenshots are also captured so the employer can see the websites an employee is accessing.

• Project Management Trackers – When managers want to know the progression of a larger project they can see how all the tasks were completed with a project management tracker. This will break down the progress of what was completed, how long each task took and which assigned employee did the work.

What are employees looking for the most in 2023?

The Bureau of Labor Statistics, as of November 2022, stated an unemployment rate of 3.7%. This means competition for talent is still high and employers need to attract workers since unemployment is low. Many job seekers in 2023 are focusing on the following incentives to find the best opportunities, including:

Higher Compensation – Changing careers became common during the Great Resignation in 2021 with frequent job hopping continuing in 2022. Where there used to be a stigma if you worked for too many companies in a short period of time, now it’s seen as a smart strategy to obtain larger pay increases. Which takes advantage of labor shortages to find the best opportunities.

Career Opportunities – According to the University of Phoenix’s Annual Career Optimism Index 2022, staying current with skills is very important to workers. As 40% indicated they fear automation and artificial intelligence could easily replace them. Upskilling to remain ahead of the learning curve is important as the index also reported that 68 percent of workers would stay with a company that offered career development opportunities.

Healthy Work Environment – Workers typically seek out comprehensive health care benefits in order to function better both physically and mentally. After the pandemic, employees became more aware of their available health benefits, including mental health, and stress related concerns. In fact, according to the Lyra 2022 State of the Workforce Mental Health, the respondents noted that stress had increased to 63% by the end of 2021. 

How employers are adjusting their hiring practices for 2023

Employers are finding that making some key adjustments to their hiring process will help to find the talent they need for their business. The following strategies in 2023 could help make recruitment easier and achieve their goals, such as:

Shortening the recruitment process – With millions of jobs available, having a long drawn out hiring process in order to find the “right” person often results in talented candidates leaving in the middle of the process, due to a frustration and a lack of transparency. If a company wants to engage candidates, they often need to offer consistent communication and flexibility, including remote interviews. Candidates are often evaluating how the company treats them during the recruitment process as an indication of whether their employment would be a good fit or not.

Offering a stronger benefits package – After salary, a strong benefits package is what distinguishes companies in attracting new hires. Since many employees got used to working from home, and enjoyed a flexible schedule, many actively seek out companies that offer remote or hybrid options. They also want educational support, retirement benefits and paid leave that supports good mental health.

Promoting ongoing communication – Many new employees don’t want to be surprised by a yearly review of their overall progress. Usually they want consistent constructive feedback in order to seek opportunities to learn new skills, and get promoted on a regular basis. Managers who also engage in consistent communication, have the advantage of being aware of any concerns that could avoid a sudden resignation.

Benefits for employers and employees in seeking a balanced approach

As 2023 builds back from a post pandemic reality, seeking a balanced approach that creates a strong and successful work environment has many benefits including:

Better understanding of the working relationship – Employers and employees who discuss shared goals from the beginning, and throughout the working relationship encourages a stronger partnership that works toward preferred outcomes. Potential conflicts are also addressed right away as opposed to escalating at a later time.

Happier employees are often more productive – According to a Forbes study, happy employees are 20% more productive. This productivity usually results in quicker project completion, fewer mistakes and happier customers.

Retaining talent and reducing turnover – A Glassdoor study estimates the average cost of hiring is $4,000 which can increase depending on the position. However, even at the average amount, the costs could add up from constant turnover. Placing someone who is a good fit with long-term goals tends to reduce the costs and ensures stability.