Dear Friends and Colleagues,
After our self-imposed three-month hiatus, we are back at the keyboard and pleased to pen our 153rd edition of The Ampersand. We hope you had a great summer. When last we wrote, our focus was on reviewing the year that had been. A look back at the lessons learned and opportunities seized during the preceding year of crisis. In this edition, we look forward.
Forward to what we believe will be an unprecedented spike in hiring and lateral movement; to the three-headed challenge that awaits employers as they balance the surge in business activity with sharpening employee expectations around working from home and the simple-yet-complicated issue of vaccinations in the workplace. For all three of these matters are interconnected and highly combustible.
Let’s first discuss the impending hiring frenzy. The supply side of the market (the candidate) and the demand side of the market (the client) are on a collision course. Each deciding at about the same time for similar but different reasons, that it’s time to make their move. Typically, there is either a downturn in hiring spurred by layoffs or tepid growth plans resulting in an oversupply of candidates OR there is strong demand from the client side, resulting in an oversupply of roles. For reasons which will become clear, we now face a scenario in which the few people you presently have on the payroll are feeling emboldened to flee with no shortage of suitors whispering in their ear. It’s not candidate demand that’s the issue; it’s the candidate demands that will prove problematic for employers moving forward.
As we emerge from COVID (assuming we are, in fact, emerging from COVID), and confidence returns, companies hesitant to either hire or fire during a period of uncertainty will feel now’s the time. Having already cut deeply during the prolonged energy crisis in Alberta, most organizations were running lean when COVID hit. And as the pandemic rolled along, begrudging tolerance of an under-performer doing a necessary job in an average manner was more appealing than cutting deeper still and then trying to figure out how to recruit and onboard an upgrade virtually.
Similarly, on the employee side, tolerating a 4-out-of-10 job, working for a horrible boss, surrounded by uninspired colleagues, was deemed worth it based on the simple calculus that receiving a paycheck during a terrifyingly uncertain global pandemic was preferred to not receiving one, let alone facing the spectre of being the new person, starting a new job, trying to figure out how to integrate and meet colleagues remotely.
No longer. According to PwC’s latest U.S. Pulse Survey of 1007 employees and 752 executives in the US, conducted August 2-6, the Great Resignation is currently underway with 65% of employees saying they are looking for a new job and 88% of executives saying their company is experiencing higher turnover than normal.
And so, fuelled by the triple shot of pent-up demand for change on both sides of the ledger, the confidence of a (mostly vaccinated) local populace desirous of something new, and the not inconsequential catalyst of steadily rising commodity prices and you’ve got yourself a hot market. So hot, in fact, that a recent report by Alberta Central projects that the provincial economy will grow by 7.5 per cent this year, tops in the country.
All of which leads to my second point: working from home and its very direct impact on the broader hiring marketplace.
Allow me to illustrate with this redacted email exchange from June 1st with the CEO of a large public company in Calgary:
Though not specifically about working from home, the exchange is a proxy for a broader conversation around employee expectations. The pendulum from an employer’s market to an employee’s isn’t so much swinging back as it is snapping violently. Mandating a return to the office without a compelling justification for doing so will only provide the accelerant required to hasten an already agitated employee’s departure. Mandating vaccines? That’s a whole other thing we’ll get to in a minute.
In our own firm’s experience, working from home did not diminish productivity. In fact, productivity soared, as did employee engagement and overall job satisfaction. And we weren’t alone. According to this article, Canadians were particularly productive (damn you, South Korea!).
What suffered was culture. Try as you might to host on-line wine, trivia games, and virtual cooking classes, most humans require human interaction to feel truly part of something. High functioning teams simply can’t perform to their fullest in isolation. The question we have been asked, and are asking of ourselves, is how to retain, let alone enhance, the culture of (y)our organization whilst giving (y)our people the ability to work from home, something most prefer to the traditional office grind and associated inconveniences (traffic, expensive lattes, pants…)? This isn’t casual Fridays or paid parking; it’s a more existential shift to what people truly value. The individual working happily from home will naturally place that comfort ahead of other collective considerations. Culture is created when the sum of the parts is greater than the whole and if the parts aren’t working together, even if they’re working well, it gets very tricky.
Make no mistake, in these parts at least, working from home is no longer (for now) a necessary imperative borne of an urgent need to keep each other safe and homeschool our kids. It is little more than another recruitment and retention tool. Those organizations that doggedly insist on a return to the past will lose people. This may not have been concerning when times were quiet, the leverage residing firmly with the employer (“where are they going to go, anyway?”) but in a booming market your people have options, and after 18 months at home they have savings and lengthy bucket lists, too. And they’ll vote with their feet. You’d be shocked to learn how easily they are triggered to leave for reasons unrelated to more traditional grievances.
The reality for many businesses is they will be adopting a hybrid working model. Whether the reason for adopting a hybrid model is driven by operating cost savings or accommodating the needs and requests of employees, the playing field will no longer be level. While many employers have been using this time to reconfigure physical office space, the bigger issues will revolve around how organizations evaluate and recalibrate corporate culture in a hybrid workforce to ensure equity and productivity.”
Executives Unlimited, August 2021 Report
Which leads to the final wrinkle we’ll sprinkle into this witch’s brew: vaccinations. Somewhere along the way, choosing to stay alive became political. I don’t recall citing my personal freedoms as justification to reject a measles shot or the poke that protected me and my family against Yellow Fever before heading to Costa Rica. Yet here we are. Tip-toeing around elephants in rooms related to vaccination status.
We recently drafted a fairly benign office policy that basically said, ‘we’re in the people business and it would be preferred to keep those people healthy and safe so please get vaccinated.’ Running it past our outside legal counsel, you would have thought we were trying to build a pipeline.
And I quote: “First, it is an open question whether inquiring as to vaccination status is appropriate under human rights legislation and privacy legislation. Generally speaking, requiring disclosure of vaccination status may be appropriate, but only where other less intrusive means of preventing infection are inadequate for the workplace. The determination will focus on the character of the workplace and the types of risks it gives rise to. Whether an office is an appropriate environment for a disclosure of vaccination status is, again, an open question at this point. Anecdotally, we know of several employers who are proceeding with similar vaccination status disclosure policies with the potential risk of non-compliance with privacy and human rights legislation in mind.”
We live in strange times when we are being asked to consider a remote legal risk ahead of an imminent health risk. Still, with an already diminished candidate pool in a frothy market, employers face the unhappy choice of mandating vaccinations and alienating (at best) or losing (at worst) another faction of your workforce OR accommodating the unvaccinated thereby creating a resentful and two-tiered employee class (at best) or endangering colleagues, customers, and community (at worst). For me, this isn’t a COVID test; it’s an IQ test. But I realize the peril of that sort of stubborn thinking, borne – as it is – from my quirky desire to keep those around me, you know, alive.
Regards,
Adam
