The “Great Resignation’ has impacted large organizations across the world. For many, a solution to this problem has been to lift wages.
The likes of Starbucks have lifted wages significantly over the last year. Nonetheless, this strategy may not work for everyone.
Wages are not the only factor that employees want to improve, there are also calls for greater benefits and flexible working.
However, even with a comprehensive benefits package and a lifted wage, there are still greater economic issues that are playing a part in US employment.
The Financial Times has reported that last month’s payrolls data showed that the US economy added just 194,000 jobs in September. This is well below the growth that was forecasted.
This will undoubtedly trouble many as President Biden attempted to kickstart the economy as he cut unemployment benefits.
There are also issues in the diversity of hires. Notably, women and racial minorities are not returning to work. This has led to claims by Slack that offices will be dominated by white males to a greater extent than pre-pandemic.
Despite rising jobs and falling benefits, companies are engaged in a bidding war for talent. Speaking to the Financial Times, Amazon and McDonald’s lamented the current situation.
Amazon, who have offered free education initiatives to staff on the ground, has stated that they expect rising wages to cost $2 billion in the fourth quarter of this year.
“For the foreseeable future, our capacity constraint is actually labor, which is new and not welcome,” said Amazon’s chief financial officer, Brian Olsavsky. This situation is leading to lower service levels and productivity.
McDonald’s CEO Chris Kempczinski predicted that “it is going to continue to be a difficult environment for the next several quarters.”
As a result, the likes of McDonald’s are passing on the extra costs that they are giving to retain and attract talent to customers.
What can be done?
While there are some commentators who attribute vaccine mandates to the lack of employment growth, there are other factors that could be impacting global companies.
A significant trend amongst Gen Z candidates is a desire to work for a company that reflects their values. In fact, LEWIS found that only 19% of Gen Z candidates would work for an employer that didn’t reflect their own values.
Given that the likes of Amazon have received many complaints about how they treat employees, it is perhaps unsurprising that the initiatives offered by the company are not being positively received.
Furthermore, it is possible that upskilling new talent can allow companies to develop a long-term strategy to combat lower staff numbers.
When Degreed’s Chief Learning Strategist, Annee Bayeux, sat down with UNLEASH she explained that young talent is approaching companies and asking to be trained.
It is unclear whether companies will begin looking to train younger talent and change their policies to reflect new values. However, it could help begin to tackle a complex situation that is impacting the wallets of the consumer and the profits of enterprises.