Workers are feeling less optimistic, according to recent data from Glassdoor’s Employee Confidence Index. Professionals reporting a positive six-month business outlook plummeted to 46.4% in May, continuing its spiral downward in the last two years.
A key factor impacting employee confidence has been declining satisfaction with leadership transparency and communication in the post-pandemic era.
In April 2020, employee satisfaction with “transparency” was at an all-time high in Glassdoor reviews—at 63%. “At the height of the pandemic, employees praised leaders for their transparency amidst a time of enormous uncertainty,” the report stated. Since then, it has plunged to 40%, which is weaker than the satisfaction rate pre-Covid.
Industries that saw the sharpest declines in employee confidence over the last year included pharmaceutical and biotechnology (-10%), aerospace and defense (-7.7%) and media and communication (-7.1%), which can be attributed to the wave of layoffs seen over the past 12 months in those sectors.
Employee confidence took the biggest tumble year-over-over amongst young adults just starting out their careers. Recent college graduates are having a challenging time finding good, well-paying jobs, as employers are requiring unrealistic professional experience for entry-level positions. As more Americans attain college degrees, it has made it difficult for young adults to compete in the job market.
A Two-Track Job Market
There is a shift happening in the job market, in which college-educated, white-collar professionals in the United States are not where they thought they would be socially, financially and professionally, according to Glassdoor chief economist Aaron Terrazas, while blue-collar workers have been thriving.
In a Zoom video interview, Terrazas stated that the U.S. labor market is increasingly splitting into two tracks, with a substantial demand for skilled tradespeople and a declining interest in hiring more “knowledge-based” laptop professionals.
“The evidence can be found in the data, which shows a higher unemployment rate for professional and business services workers, and a lower one for people who work in manufacturing,” the economist also told NBC News. “It’s a buyer’s market for brain and a seller’s market for brawn.”
In Glassdoor’s April 2024 jobs report, Terrazas wrote, “There are clear fractures beneath the surface of the labor market, and a growing consensus that job opportunities are meaningfully softer for some sectors and for some workers.” He added that hiring was mostly driven by healthcare, the public sector and social services. There was little to no movement in job creation for white-collar workers.
Additionally, the number of part-time workers who desire full-time employment reached its highest level since November 2020.
The chief economist said that the tight job market experienced throughout 2021 and part of 2022 set a new “baseline” for what felt good for white-collar professionals. The de-emphasis and pullback on the hiring of knowledge workers is a market correction and “renormalization” to pre-pandemic norms, although he acknowledges it feels like a loss of status to the laptop class.
Terrazas cited the Goldman Sachs report warning that 300 million jobs could be lost or diminished due to the ascendancy of artificial intelligence, which would impact fields like legal, engineering, finance and healthcare. He highlights the trend of companies moving more jobs to lower-cost countries, with 7.3% of U.S. executives planning further offshoring, according to a Federal Reserve survey.
How Workers Can Combat A Challenging Job Market
In light of all the challenges, it’s reasonable that Americans have lost confidence in the economy, job market and business leaders.
Historically, the U.S. has been through several tumultuous upheavals. In recent times, Americans experienced the difficulties of the manufacturing sector in Middle America that turned into the Rust Belt. There was also the dot-com boom and bust, September 11 and the financial crisis, as well as the Covid-19 pandemic and other events that disrupted people’s careers and lives. Terrazas believes this speaks to the resiliency of the American people.
He advised embracing change and cultivating an adaptable mindset. While American workers experienced near euphoria during the Great Resignation, with plentiful jobs and inflated wages, the job market waned due to cost corrections. Although it may feel as if you have had the rug pulled out from under you, especially after taking on thousands of dollars in student debt only to be met with an abysmal job market, you cannot throw in the towel.
This is the time for reinventing yourself professionally. He pointed out that this period of time is unique in that you can relatively easily find online courses to learn new skills and propel your career development. You must gain agency over your career ambitions and goals by finding mentors and coaches, as well as leveraging your network to find new opportunities.
How Employers Can Restore Confidence
Business leaders can reestablish trust and foster a positive workplace culture by actively practicing transparency, investing in employees and offering social recognition.
Employers should be upfront about the challenges the company is facing, take accountability and avoid trying to downplay or ignore the issues. Admitting faults and owning mistakes can go a long way in rebuilding trust.
Communicate a clear path forward and reiterate the company’s vision, direction and plan to address the setback. Providing clarity helps reassure employees about the future.
Reinforcing the organization’s shared mission and values can re-instill a sense of purpose and reignite their confidence in the company’s goals.
Foster an environment of open dialogue by actively listening to employee concerns, seeking feedback and allowing them to voice their perspectives without fear.
Employers should demonstrate the behaviors and accountability they expect from employees. Leading with integrity, resilience and a positive mindset can inspire confidence.
Provide internal growth opportunities and invest in employee development through training and mentorship programs. This shows commitment to their growth.
Celebrate successes, no matter how small, through public recognition, bonuses or other rewards. This positive reinforcement boosts morale.
To rebuilt rapport, conduct one-on-one meetings with individuals to check in and reconnect.
Try to get some quick wins under your belts. Identify and achieve short-term goals to help build momentum and demonstrate progress, which can restore confidence in the company’s direction.
Promote teamwork and idea sharing. The unity and support this creates can increase employees’ confidence in the organization.
Source: Forbes
