2022 Labor Outlook: The Great Resignation Rolls On
2022 Labor Outlook: The Great Resignation Rolls On
2021 was marked by challenges and change—a year for the books. Its chapters: The Great Resignation; The War for Talent; Resignation Nation; Turnover Tsunami; The Great Attrition; ‘Striktober and The Labor Market Fallout—kept businesses turning the pages—hoping for a better ending. But it didn’t come.
These coined terms—backed with the latest data from the U.S. Bureau of Labor Statistics—adds to the labor outlook story and suggests that The Great Resignation will roll on in 2022.
According to the BLS, more than 4.5 million people voluntarily left their jobs in November. That was up from 4.2 million in October and was the most in the two decades that the government has been keeping track. And with a sharp rise in COVID-19 cases in December and January already weighing on demand in high-contact service sectors, new headwinds for the labor market will create a bigger impact on labor supply.
Results from a study conducted in November 2021 by the US Chamber of Commerce, also suggested that labor shortages could even be permanent, given how many people left jobs during the pandemic and have not returned to work.
Although it’s a new year—there aren’t many indicators that the labor shortage is going away anytime soon. So, what comes next when demand for workers has recovered, but the number of willing workers has not?
The latest Pew Research report shows how the gig economy has ushered in new way of connecting people with consumers and those who want to hire them. A vast majority of U.S. adults—94% according to their report—believe gig platform jobs are a generally good way to earn extra money as a side job or to have the ability to work a flexible schedule.
Certainly, the emergence of companies like Uber, TaskRabbit, DoorDash and Hyer—have expanded the way people earn money and added another dimension to today’s the labor force. A welcoming one for gig workers and businesses alike.
New Year, New Priorities
McKinsey & Company’s latest labor report, The Great Attrition of 2021, employees resigning in record numbers—continues unabated. In a recent survey they discovered that 58% of employees indicated that they were somewhat likely to almost certain to quit in the coming months. Likewise, a majority of the employers participating in the research were experiencing record levels of turnover and expected it to continue.
Parents, who have faced some of the harshest conditions during the COVID-19 pandemic, are joining this exodus with gusto—looking for more flexible work opportunities, from taking time off and starting their own businesses to turning to gig roles. And for good reasons. One of them, the lower-income respondents said, is that this type of work affords them more flexibility to care for family. A trend that fueled gig workers to flock to Hyer in 2021–where we saw a 208% increase in Taskers downloading the app. A number reflective of a bigger shift in the way people want to work.
According to Dollar Sprout’s 2021 Side Hustle Report, side gig jobs are becoming more like main gigs for many Americans.
41% percent of gig workers relied on their gig jobs to cover monthly expenses in 2021—up from 27% in 2020.
The percentage of people spending more than 15 hours per week on gig work more than doubled in 2021 as well, increasing from 12% to 27%.
The share of gig workers who earned more than $1,500 per month increased from around 4% in 2020 to more than 14% in 2021.
All of that to say, for a lot of gig economy workers, gig work is no longer just a temporary hobby. The pandemic gave American workers a lot of time to reflect on what’s important. Overwhelmingly freedom and flexibility became their north star. The freedom to set their own hours, be their own boss, have more work/life balance and feeling more fulfilled in what they do has certainly fueled a new phenomenon that’s here to stay. One that can also bring businesses back to life if they’re willing to grab hold of it.
New Year, New Workforce Strategy
Deloitte’s latest report points to a greater gig strategy this year. Steve Hatfield, Global Future of Work Leader at Deloitte said, “In 2022 temporary and “gig” workers will be an increasingly important part of the workforce, which presents both opportunities and challenges for organizations. In this free-market economy, individuals may work for multiple employers at the same time. Employers are just fine with that, as the arrangement gives them the flexibility to staff and up-down to meet fluctuations in demand.”
Businesses have a lot of incentives to embrace this trend. Chief among them is flexibility. Hatfield noted that, “Companies are finding that many roles that were long assumed to require workers can be permanently redefined or broken up to accommodate contractors. Gig workers can also supplement full-time staff for short-term assignments requiring specialized expertise or seasonal changes in activity. An option that makes the employer’s job even easier—providing a reliable workforce without the overhead costs.”
A win-win where workers get the flexibility they crave and businesses meet their labor demands while boosting their bottom line.
New Year, Next Steps
In 2022, something’s got to give. Organizations must go beyond the traditional staffing playbook and take innovative, decisive actions—which Deloitte says includes tapping gig work through company-owned or third-party labor platforms. “There’s no question, though, that flexible labor will become a more entrenched part of the workforce. This will require organizations to think more strategically about how work is done.” We couldn’t have said it better.
