INTRODUCTION
Current State of Work: Leaders Caught in the Crossfire
Competitive Advantage Through Talent: Today’s Business Imperative
The Workplace Intelligence Report started with an ambitious idea: analyze the most important aspects of the workplace and uncover the trends impacting it. We set out to understand how business leaders and employees perceive work today in the context of these trends by addressing two important questions:
1.
What’s causing businesses to take action on Talent-related issues?
2.
What is the perceived business value of addressing these issues?
HRWins and Greenhouse surveyed 1,312 businesses with a minimum of 1,000 employees in the U.S. and U.K. in two separate surveys. In a second research initiative, we surveyed 4,013 employees at levels from staff member to Vice President in the U.S. and U.K. to better understand how employees and employers hold the same perspective, and where their perceptions differ.
Introduction
People Strategy
Transparency, Values & Culture
Diversity & Inclusion
The Multigenerational Workforce
Engagement vs. Longevity
Hiring & Onboarding
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Two disruptions are challenging today’s business leaders, both with significant impact. First, the rapid advances in work and Talent-related technology that continue to enter the market. The second is our challenge in coming to grips with cultural, demographic and societal shifts that are changing the workplace. Business leaders focused on Talent-related issues are caught between these two disruptions, and both are happening at faster rates than anyone could have a chance to keep up with, let alone harness and leverage them as an innovative leader. Each is impacting the expectations employees and leaders have of their workplace and the technology that supports it.
An example: While the thinking on Diversity & Inclusion in the workplace has evolved since the 1960s and the initial days of affirmative action, the application of that thinking in the workplace and the technology to support it did not develop at the same rate. Movements like #MeToo caused businesses everywhere to look for ways to implement new approaches and come up to speed quickly. The emergence of new technologies like artificial intelligence, machine learning and automation to help minimize bias in pre and post-employment practices hit the market at a revolutionary speed at about the same time businesses were jarred into looking for new approaches. Most companies today understand the value of D&I, yet our data shows that there is more intent than action on the matter.
As we explore the research results in the data, we find many conflicts that need justification:
The high-value perception of Talent-related issues vs. a lack of action
The lack of change in approaches to hiring and managing Talent vs. ongoing record-low global unemployment
The importance of recruiting and retention vs. the lack of training and structured process in these areas
Looking at the data alone, some of the results are disappointing at first glance. A pessimist would conclude that this is just more of the business saying that Talent-related issues are strategic priorities, while not putting any money toward taking action. However, after validating this data into field interviews and considering the pace of workplace transformation, it seems to be more of a direct reflection of where we are in solving the problems vs. a picture of the market sitting on its hands.
You’re Only as Good as Your People Strategy
Recruiting Is Top of Mind Across the Enterprise
The sting of low global unemployment and a widening skills gap is clear when we look more closely at top Talent-related issues. Across the board, finding and retaining top Talent is listed as the number one business issue more frequently than increasing workforce productivity. When we look at the weighting of these two areas across all respondents regardless of department, respondents feel that finding and retaining top talent is more important than improving workforce productivity.
35
%
25
Improving Workplace Productivity
Finding and Retaining Top Talent as Top Concern
26
18
Talent-related Issues as Top Concerns Across All Roles
CEO/President/Owner/Founder
29
22
Sales and Marketing
36
27
Operations/General Administrative
39
13
Finance and Purchasing
38
Production
Research and Development
When It Comes to Talent-Related Issues, It’s Time for Less Talk and More Action
How to Achieve Pay Equity, with Patty McCord (Author, formerly Netflix)
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How do Talent-related issues stack up against other concerns in your business? They rank as two of the top three business concerns, according to business respondents. It's no surprise to see improving workforce productivity as a top-of-mind business concern for leaders across the enterprise. Since 2010, labor productivity has been lower than at any other time previously, according to the U.S. Department of Labor. The second Talent issue that weighs on the minds of businesses is finding and retaining top Talent. This topic has become headline fodder as we experience sustained record-low global unemployment and an increasingly challenging skills gap. According to a Hays study, 75% of employers say they are experiencing a skills shortage.
What are the top concerns in your business?
50
46
45
43
42
of CEOs surveyed feel that Talent-related concerns are their most important business problems.
47
Managing Through Unforseen Financial or Market Conditions
Attracting and Retaining Customers
Increasing Profitability
Reducing Operational Costs
Finding and Retaining Top Talent
Improving Quality of Products and Processes
Improving Workforce Productivity
All Business Respondents
Improving Quality of Products and Cost Processes
Reducing operational costs
Increasing Profitiablity
Managing through Financial and Unforeseen Market Conditions
CEO/President/ Owner/Founder
Operations/ General Administrative
Other
Talent-related matters of improving workforce productivity and finding and retaining top Talent are spread relatively evenly across the enterprise. This trait is evident for the other issue in the top three business concerns: improving the quality of products and processes.
24
37
20
71
40
41
58
67
44
32
34
48
52
49
51
57
54
53
of CEOs surveyed feel that Talent-related concerns are their most important business problem.
Managing Through Unforeseen Financial or Market Conditions
I Believe
I Strongly Believe
Hiring
Pay Equity
Company Culture
Workforce Inclusion
Workforce Diversity
Gender Equality
30
31
33
Do you believe that when an organization is competitive in the following areas there is a direct financial impact on the business?
Our survey results show that the enterprise perceives a clear and striking financial value for People-related issues. However, when we asked which culture-related issues were driving action within the business, the results weren't as compelling. The opportunity is present for leaders in and outside of HR to prioritize on these matters for both cultural and financial gains.
Rank of "Finding and Retaining Top Talent"
11
23
Arts/Entertainment/ Recreation
1st Concern
3rd Concern
2nd Concern
4th Concern
12
Transportation/Warehousing
Retail
28
Professional Services
21
Industrial Manufacturing
16
19
Healthcare/Social Assistance
Food/Beverage/Restaurants
7
Education
0
Consumer/Personal Services
Construction
Computer Hardware/Software
15
Business Services
Banking/Financial Services/ Insurance
17
All Industries
Rank of "Improving Workforce Productivity"
56
14
6
The Struggle to Gain Employee Trust Is Real
How to Build a Strong Company Culture, with Katie Burke (HubSpot) and Ginger Hardage (formerly Southwest Airlines)
Culture Will Compel Half of Companies to Greatness
The relative correlation between 66% of our respondents who perceive the positive financial impact of company culture and 50% of respondents who say their company treats culture like a strategic initiative is striking.
My employer’s company culture aligns with its values.
3
I Strongly Disagree
Neutral
I Strongly Agree
I Disagree
I Agreee
I Don’t Know
Baby Boomers
5
Gen X 1965 - 1980
Millennials 1981-1994
8
Gen Z 1995–2015
4
I Agree
All Generations
Maybe They're Not Engaged Because You Don't Engage Them
There is an urgency associated with transparency in the workplace as issues like pay equity, gender equality and inclusion continue to both make headlines and spur action.
Issues Driving Action in My Business: Please identify which of the following issues you believe are driving some form of action from your employer:
Politics (Outside the Workplace)
Sexual Harassment
Bullying in the Workplace
Exclusion
#MeToo Movement
Diversity
Pay Equality
Inclusion
Just 47% of employers surveyed report that their company culture encourages transparency. In the U.K., fewer respondents strongly agree that their employer encourages transparency compared to the U.S.
My employer’s culture encourages transparency with employees.
Total
U.K.
U.S.
I Don't Know
6%
7%
34%
36%
33%
26%
21%
18%
22%
10
9
At the same time, 34% of respondents agree that their employer struggles with transparency, while only 26% disagree with that sentiment.
My employer struggles with transparency with employees
Over the course of an average month how much time do you spend on People-related issues (hiring, firing, feedback, etc.)?
2
Between 7 and 9 hours
Between 13 and 15 hours
Between 16 and 25 hours
Between 26 and 40 hours
More than 40 hours
Less than 1 hour
Average Across All Respondents
Between 1 and 3 hours
Between 4 and 6 hours
Between 10 and 12 hours
Half of survey respondents outside of HR roles report that in an average month they spend three hours or less on People-related issues like hiring, firing and employee feedback. More than one third say they are spending less than an hour per month on these same activities. The average number of conversations per month with a colleague or staff member centered on People-related issues is four.
CEO/President/Owner/ Founder
Operations/General Admin
2%
31%
32%
29%
56%
17%
12%
15%
16%
13%
10%
14%
8%
11%
5%
4%
9%
1%
3%
Spending three hours or less on People issues.
Non-HR Respondents
Spending one hour or less on People issues.
Companies average approximately 10 People-related conversations per month
In the last 30 days, how many times have you had a conversation with a colleague or staff member at work about a People-related issue? (hiring, firing, feedback, etc.)
20.36
Banking/Financial Services/Insurance
11.08
5.89
7.47
15.58
9.26
14.00
11.35
8.83
11.66
9.43
7.83
15.86
Arts/Entertainment/Recreation
We All Agree Diversity & Inclusion Is Important. We're Just Not Sure What We're Doing About It.
Diversity & inclusion
Traditional Methods to Fix D&I Are Broken. It’s Time to Change the System.
It's broken. Fix it. Mandatory diversity training, job testing and grievance systems make up three of the top four methods used by respondents' employers to address Diversity & Inclusion challenges. Not surprising, since these tactics have been popular since the 1960s. However, these three areas are also identified as making companies less diverse according to a Harvard Business Review Study.
How does your company address Diversity & Inclusion issues in the workplace?
U.K. & U.S.
Training
Employees are encouraged to report issues to Human Resources
Employees are encouraged to report issues to their manager
Anonymous reporting (phone-line, email, messaging)
Investigations
Systemic changes to work processes and/or behaviors
How Senior Leaders Are Addressing Diversity, with Ellen McGirt (Senior Editor, Fortune)
In 2015, 77% of CEOs surveyed in PWC's Global CEO Survey said they had a formal Diversity & Inclusion strategy or a plan to adopt one in the next 12 months. Based on our results, we've drifted off track in just a few short years. D&I is taking on increasing importance in light of today's global political, economic and business environment. The impact that it can have on culture, work environment, brand and productivity demand a higher rate of response. While hiring experts in the field of workforce D&I agree that creating and directing related programs is a solid starting point, business leaders need to take action. Top executives would be well-served to:
Establish D&I initiatives as a priority within their company
Require ongoing measurement of efforts
Regularly communicate priorities and results back to the entire team
Diversity & Inclusion (D&I) has consistently been shown to have positive impacts on business. More than half (55%) of respondents say their employer has a Diversity & Inclusion program. However, 26% don't know whether such a program even exists.
Does your employer have a Diversity & Inclusion Program?
More than 45% of staff-level employees either don’t know whether their employer even has a Diversity & Inclusion program in place or don’t have a program at all.
Yes
No
Companies in the Arts/Entertainment/Recreation sectors have fewer D&I programs than in any other industry. When it comes to knowing whether a program is in place, employees in Food & Beverage and working at Restaurants are in the dark, unsure of whether a program even exists.
Diversity & Inclusion by Industry
53%
30%
52%
38%
58%
27%
48%
24%
60%
23%
55%
25%
20%
40%
37%
83%
74%
19%
68%
70%
Employers surveyed directly link Diversity & Inclusion to improvements in culture, work environment, brand reputation and productivity.
A Positive Improvement to Company Culture
A Positive Impact on Work Environment
Improved Brand Reputation
Improved Productivity
A Direct Positive Financial Impact on Business
There Is No Business Value of Diversity & Inclusion
Impact of D&I on the Business
As the Workforce Shrinks, Are We Underestimating the Challenge?
Challenging the Assumptions About Generations in the Workforce
Myth: Millennials Don't Care About Money
Everyone Wants More Flexibility
The Contingent Workforce Continues to Rise
Meaningful Work Means Something
Distributed Work Is the Future
Baby boomers exiting the workforce is causing challenges for employees.
Approximately half of survey respondents believe baby boomers exiting the workforce is causing challenges for their employers, and about 40% see it as creating challenges for all employees. Today, we’re at about the halfway point to all baby boomers reaching retirement age, and perhaps these metrics are in alignment with the exit, but it seems the challenges related to finding and retaining top Talent aren't going to get any easier given this impending exodus.
Baby boomers exiting the workforce is causing challenges for my employer.
Being technically competent (working with applications on computer and smartphones) gives employees an advantage at my employer.
Gen X 1965–1980
Millennials 1981–1994
49% of employers report that their work environment has made changes to accommodate younger workers. Most of these changes were triggered by a series of common assumptions regarding millennial and post-millennial (Gen Z) workers’ preferences in the workplace.
My employer’s work environment has changed to accommodate younger generations entering the workforce.
Maybe we had it wrong. The assumption that millennials, and now Gen Z, will take more meaningful work for less pay appears to be one of the biggest generational misunderstandings introduced in the last decade. When it comes to meaningful work and the amount of pay workers are willing to accept for it, it turns out the younger generations aren't that much different than those who came before them. They are broadly split on the issue, however, and 25% of them are neutral on the topic.
I would accept less pay for more meaningful work.
Another common assumption prior to our research was that millennials and Gen Z were more willing to work remotely. The data proves that across the board, all workers want the flexibility to work from home, coworking spaces or other remote venues. A whopping 80% of survey respondents agree or strongly agree that they are willing to work remotely.
I am open to working remotely.
It’s reported that 47% of the workforce consists of independent workers, meaning they are employed as a contractor, freelancer or independent consultant. All generations currently in the workforce skew toward openness to working as a freelancer or contractor.
I am open to working as a freelancer or contractor.
Everyone wants to be paid fair compensation that reflects their work. They also happen to want to find meaning in their work, too. The generational divide may not be as broad as widely believed. While not necessarily willing to take less pay for more meaningful work, all generations in the workforce prioritize the search for meaningful substance in their daily employment.
It’s important to me to find meaning, beyond the contribution made to my employer, in my work.
54% of employers surveyed say they offer employees the ability to work remotely. Those offering remote work arrangements are providing a mix of part and full-time options for working from home or a remote office.
Does your employer offer employees the ability to work remotely?
63
Our work environments and spaces are changing rapidly across many industries. We know that a coffee shop, home office or coworking space is now just as prevalent as a cubicle, classroom or construction site. Our survey respondents shared the following images of their unique workplaces.
Location: UK Industry: Transportation/Warehousing
Company Size: 10,000 or more Employee Generational Demographic: Gen X
Location: Utah Industry: Healthcare/Social Assistance
Company Size: 50 to 99 Employee Generational Demographic: Baby Boomer
Location: Texas Industry: Computer Hardware/Software
Company Size: 100 to 249 Employee Generational Demographic: Gen X
Location: Florida Industry: Banking/Financial Services/Insurance
Company Size: 500 to 999 Employee Generational Demographic: Gen X
Location: Delaware Industry: Industrial Manufacturing
Company Size: 3,000 to 4,999 Employee Generational Demographic: Gen X
Location: UK Industry: Retail
Company Size: 1 to 19 Employee Generational Demographic: Gen X
Location: South Carolina Industry: Other
Company Size: 500 to 999 Employee Generational Demographic: Baby Boomer
Location: Michigan Industry: Restaurant/Food & Beverage
Location: California Industry: Education
Location: Florida Industry: Other
Company Size: 50 to 99 Employee Generational Demographic: Gen X
Location: Illinois Industry: Healthcare/Social Assistance
Company Size: 10,000 or more Employee Generational Demographic: Baby Boomer
Location: Lindon, Utah Industry: HR Software
Company Size: 251 to 499 Employee Generational Demographic: Xennial
Location: Chicago, Illinois Industry: Data Science Technology
Company Size: 101 to 249 Employee Generational Demographic: Millennial
Location: New York, NY Industry: CPG/F&B/Corporate Venture Capital
Company Size: 1,000 to 1,499 Employee Generational Demographic: Millennial
Location: California Industry: Healthcare/Social Assistance
Company Size: 5,000 to 9,999 Employee Generational Demographic: Gen X
Location: United Kingdom Industry: Transportation
Location: Washington Industry: Construction
Given employees' desire for flexibility, distributed work arrangements can be an extra incentive for people considering whether to accept or continue employment with your firm. Given the challenge of finding and retaining top Talent, employers should consider incorporating remote work policies and the implementation of infrastructure to keep those working remotely connected to their managers and teams.
What types of remote work arrangements are offered?
All of the Above
Work From a Remote Office on a Full-time Basis
Work From Home on a Part-time Basis
61
Work From Home on a Full-time Basis
Work From a Remote Office on an Occasional Basis
Work From a Remote Office on a Part-time Basis
U.S. & U.K.
55
62
All Respondents
Work From Home on a Full-Time Basis
Work From A Remote Office on a Full-Time Basis
Work From Home on a Part-Time Basis
Work From A Remote Office on a Part-Time Basis
Work From A Remote Office on an Occasional Basis
Of those businesses offering distributed work, doing so on less than a full-time basis, whether from home or a remote office, was prevalent across industries. There is no apparent correlation to industries that would typically have a more significant percentage of highly skilled workers. The opportunity to work remotely is a perk that can be leveraged to improve employee experience and retention in most industries.
ENGAGEMENT VS. LONGEVITY
Talent Management Is Still Waiting for Disruption
Length of Job Tenure Is Considered Less Important Than in the Past
Employees Aren't Buying "Work-Life Integration"
Achieving Work-Life Balance Is Beneficial
As Retention Times Decrease, Few Employers Have Adapted
Only 30% of employers in our survey say they’ve adapted their approach to managing Talent to account for shorter average retention times. With all the talk about disruption and the challenges in hiring and retaining top Talent, this is one stat we expected to find more aligned with reality. There was good news concerning employee retention. More than 50% of survey takers on both the employee and employer sides report that employees can easily transition into other departments to gain experience.
Can employees at your company easily transition into other departments to gain experience in other areas of your business?
Is employee retention a meaningful metric for your employer?
Shorter average tenures in the workforce led many to believe that employee retention rates would be less critical. Two-thirds of respondents still look at it as a meaningful metric. It’s especially true for managers and above, but nearly 50% of staff-level respondents rate it as highly meaningful.
Across All Respondents
64
68
74
75
Director
Supervisor/Manager
Staff/Individual Contributor
Vice President
C-Level Executive/ Owner/Founder
What is your learning technology/system used for?
To Help with Topics Outside of Work
For Personal Wellness Training
To Employee Enable Career Paths
To Achieve or Maintain Professional Credentials
For Individual Improvement/Self-help
To Help Improve Day to Day Work Activities or Tasks
For Personal Professional Development
To Achieve or Maintain Compliance at Work
66
For Skills Training
70% of employers still review employee performance annually, with some small movement toward a more frequent approach. The trend has been moving aggressively away from the use of "stacked rankings" in the appraisal process. Employers are slowly moving to semi-annual, quarterly or ad hoc methods of feedback.
What is the frequency of your employer’s performance review process?
70
Quarterly
Annually
Ad hoc
Monthly
Less Frequently than Annually
Are ratings from your employer’s performance review process viewed as providing valuable insight into the business?
When considering the hire of a new employee, how does the amount of time they’ve spent at their previous employers factor into your hiring decision?
1
Shorter Stays at Previous Employers Factors Negatively
Longer Stays at Previous Employers Factors Positively
It Does Not Factor Into My Decision at All
Shorter Stays at Previous Employers Factors Positively
Longer Stays at Previous Employers Factors Negatively
While more than 35% of employers surveyed feel the amount of time at a previous job doesn't factor into a hiring decision at all, nearly 35% say that it does factor in positively and more than 20% feel that shorter stays contribute negatively to a hiring decision.
Employers and employees alike agree the benefits are strong when work-life balance is achieved.
Which of the following do you feel is more realistic to achieve?
82
UK
US
A Balance Between Work and Personal Lives
An Integration of Work and Personal Lives
86
83
81
Gen Z 1995 or 1996
Baby Boomers 1946–1964
What do you believe the benefits of work-life balance are in the workplace?
77
60
Happier Employees
Healthier Employees
Increased Productivity
Improved Culture
59
80
78
85
72
Do you feel that your current employer offers programs, benefits or perks that enhance your work-life integration?
Nearly 60% of U.K. respondents feel that their current employer does not offer programs, benefits or perks to enhance work-life integration, while just over 30% are seeing initiatives in place to create more integration. Stateside, almost 45% of respondents are seeing enhancements aimed at achieving work-life integration.
Do you feel that your current employer offers programs, benefits, or perks that enhance your work-life integration?
Has your employer adapted its approach to managing Talent to account for shorter average retention times?
Transparency. Values & Culture
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HIRING & ONBOARDING
We Aren't Preparing Managers to Be Good at Hiring and Retaining Their Teams
Talent Pros On What Makes a Great Hiring Manager
Upgrading Your Onboarding Experience Will Translate Into Customer Gains
Talent-Driven Business Is the Wave of the Future
We believe this year's data shows us that our understanding of the value of People and Talent-related issues is on an advancing path, and employers have many solutions simultaneously in-process that are leading us toward a better place. This report will serve as a useful benchmark to continue charting our progress by aggregating new data and evaluating survey results in coming years. To see the full demographics of survey respondents that informed this research, download and read the full-length Workplace Intelligence Report.
43% of our employer respondents are involved in the hiring process at some level. Of those involved, 63% make hiring decisions, 64% are involved in interviews, and the balance of respondents is involved in the hiring process in some way. Only 39% have received some interview training, and the process used to guide them to a hiring decision is mostly unstructured. Interview guides are used only 40% of the time, and there is little structure or consistency to the questions being asked, or the way interviewer feedback is captured. Nearly 20% of survey respondents claim that hiring is completely unstructured in their companies.
Please select all of the following statements that are true about your current company’s hiring efforts:
Hiring Is Completely Unstructured
Interview Feedback Is Not Consistently Requested
Limited Interview Feedback Is Requested
I Am Given Areas to Focus My Questions and Feedback for Each Candidate That I Interview
Interview Feedback Is Captured in a Standardized Format
We Use Interview Guides
My Current Employer Has Provided Me With Interview Training
In today’s job market, hiring will become a competitive advantage for those companies equipping hiring managers and interview teams with training and a structured process to follow. While the need for improvement crosses all generations, the opportunity to leverage technology for a more effective and efficient hiring process is significant as demographics continue to shift toward a more digitally-native workforce.
Most HR teams have leveraged process and technology to track logistical and fundamental issues related to onboarding. Our data shows that 86% of employees feel their onboarding experience met or exceeded their initial expectations at their current company. With the process piece essentially nailed according to survey respondents, it's time for employers to focus on the onboarding experience. Studies have long tied onboarding and employee experience to brand and customer experience.
Thinking of your own personal experience, has your experience as an employee met the expectations you developed based on the interview/hiring process you went through to join your current company?
Failed to Meet My Expectations
Inconsistent With My Expectations
Met My Expectations
Exceeded My Expectations
Far Exceeded My Expectations
We drilled further into each aspect of onboarding and, as you can see in the data, the results didn't skew by any one aspect performing highly. All elements of onboarding received incredibly high marks.
Access to Workplace/ Workstation
Access to Technology and Tools Required for Your Work
Introductions to the Team You Will Be Working With
Required Training
Access to Relevant HR, Payroll and Benefits Information
More Than Met My Expectations
88
87
90
