EDITOR'S NOTE: The job market is extremely tight. This means that bargaining power, according to consulting firm PwC, “is in the hands of the individuals that are employed.” Based on the firm’s recent survey, the Great Resignation has shifted to a new phase in which employed individuals are in a position to quit their jobs for more competitive pay and other demands. These demands are highest in the tech sector, where skilled labor holds the upper hand in dictating the terms of employment. As inflation continues to eat away at household incomes, it's understandable that employees would demand higher pay to compensate. Workers are in the best position to present their services up for bidding among competitive companies. But are we seeing the beginnings of a wage inflation spiral? Until the participation rate increases to a point where job openings are truly near full employment, higher wage demand will likely fan the flames of an overheating economy, causing businesses to raise prices across various sectors which, in turn, will prompt employees to demand even higher wages.
- A survey by PwC of more than 52,000 workers in 44 countries indicates the Great Resignation is set to continue.
- Some 35% say they plan to ask their employers for a pay raise, with the pressure highest in the tech sector.
- More money is the biggest motivator for a job change, yet finding fulfillment at work is “just as important,” according to PwC.
The Great Resignation is set to continue, according to a new global survey by PwC, with one in five saying they are likely to switch jobs in the next 12 months.
The consulting firm said in a press release that higher pay, more job fulfillment and wanting to be “truly themselves” at work are the factors pushing workers to change jobs.
Some 35% of respondents are planning to ask their employers for more money in the next 12 months.
“The findings are very clear ... you see a significant number of employees concerned about their future employment and their job security,” Bob Moritz, global chairman of PwC, said at the forum.
However, “the power is now, we would argue — in the hands of individuals that are employed.”
A polarized workforce
The pressure for more compensation is highest in the tech sector, where 44% of respondents who work in the industry said they plan to ask for a raise, according to PwC. Conversely, only 25% in the public sector said they plan to do the same.
“Skilled employees are most likely to ask for promotions and pay raises and to feel listened to by their manager, while those lacking skills lack power in the workplace,” PwC wrote in a press release published Tuesday.
“If those people feel they have the skills, they are more confident to ask for new and different opportunities, they are more confident ... to have a conversation about total rewards packages, they are more confident in terms of the purpose that they believe they are fulfilling,” Moritz said.
Other survey findings point to more differences in the workforce:
- 70% of those with scarce skills feel satisfied with their job, compared to 52% of those with skills that aren’t scarce.
- Women are 7 percentage points less likely than men to say they are fairly compensated, yet 7 percentage points less likely to ask for a raise.
- Women are 8 percentage points less likely to feel that their managers listen to them.
- Generation Z (ages 18-25) workers are less satisfied with their jobs and twice as likely as Baby Boomers (ages 58-76) to be concerned that technology will replace their roles in the next three years.
With a tight labor market, it is even more important that organizations take a “human-led, tech powered approach,” said Carol Stubbings, PwC’s global tax and legal services leader.
“That means investing in both digital transformation and in skills … with a focus on strengthening the capabilities of skilled employees, providing access routes for those who lack skills and automation that frees up people to do what only people can do.”
Job fulfilment ‘just as important’
More money is the biggest motivator for a job change, yet finding fulfillment at work is “just as important,” according to PwC.
Some 71% of survey respondents said a pay increase would prompt them to change jobs, yet 69% said they would change employers for better job fulfillment too.
They’re also interested in making sure that ... work is meaningful not only to the strategy of an organization, but also to the purpose of that organization.Bob MoritzGLOBAL CHAIRMAN, PWC
“Rewarding [work] has to get defined in new and different ways,” said Moritz. Employees “are looking for changes to that work, especially as you think about how automation can help reduce the monotony and some of the routine type of things that they do.”
“They’re also interested in making sure that ... work is meaningful not only to the strategy of an organization, but also to the purpose of that organization.”
Workers want a workplace that allows them to truly be themselves too, with 66% of those surveyed indicating this as an important factor.
“The role of employers isn’t to tell workers what to think, but to give them a voice, choice and safe environment to share feelings, listen and learn about how these issues are impacting their colleagues,” said Bhushan Sethi, co-leader of PwC’s global people and organization services.
“Workers, especially younger and ethnic minorities feel the benefits of engaging in respectful and tolerant conversations,” said Sethi.
According to the survey, 65% of workers discuss “social and political issues” with colleagues frequently or sometimes. These conversations are even more common among younger workers (69%) and ethnic minorities (73%).
Nearly 80% of those who talk about social and political issues at work reported at least one positive consequence coming from it, while 41% reported a negative consequence from talking about social issues.
“Diverse workforces will inevitably bring differences of opinion about major societal issues into their workplaces,” said Sethi. “Leaders need to ensure these discussions can benefit teams rather than dividing them.”
Originally published on CNBC.