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well the workplace remains with elements that are very much in flux at the moment
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we've seen people switching jobs at record levels over the last couple of years and of course uh remote work
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remains a component of the workplace now and most likely in the future but what should we expect as we head into 2024
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Matthew Bidwell is Professor of management here at the Wharton School and he joins us to kind of go over and
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give us some ideas on what he thinks may play out great to see you Matthew good to see you too let me before we talk
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about 2024 let's just look at 2023 first and realistically what do you think are
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the main takeaways when you think about the workplace and and and careers and the labor force glad you're asking about
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2023 first mainly because we know that experts do no better at predicting the future than anybody else so I think I
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can give you a good rundown on what happened 2024 it's anybody's guess but
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let's start with 2023 I think of 2023 as being the year where one interesting thing happened and
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two interesting things did didn't right so the interesting that happened um the labor market cooled down and so
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we saw 2021 and 2022 genuinely historic levels of attrition genuinely historic levels of
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job openings it was a huge Haring binge it was very hard for employers to find people they poached anybody that they
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could get huge amounts of Mobility like you said particularly for um hourly workers if you're an employer this was a
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nightmare if you're the fed this was a problem because you're worrying about
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wage inflation if you're an employee in particularly one with say a high school
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education so these employees have been overlooked in the labor market it was a fantastic couple of years um 2023 things
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cooled down when you look at the aggregate statistics we're back to 2019 and I remember being in here chatting to
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you in 2019 and were saying well since it's a overheating hot labor market are
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very tight and employees have to think more so I mean it's still we're not in
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recession by any stretch but we're we're back to something that people recognize
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as a little more normal and in certain sectors perhaps some of the ones that craziest so Tech particularly outside AI
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you know it's been a very marked slowdown so I think that's the interesting thing that's happened like
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some reversion to something looks like normal um the two interesting things that didn't happen um one I think is
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around remote work um there was a huge amount of noise about return to office um and you saw some high-profile
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companies particularly Amazon some of the big Banks it's real kind of we're
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putting our foot down from now on you're going to be back in the office it gives
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the impression that we seen kind of a decline in remote work there are a couple of series of Statistics that I
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look at to understand this there's a wonderful survey that's done monthly by
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um a team based in Stanford also Castle systems the do badge swipe data they would release
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their back toor barometer um weekly kind of showing what's happening with office
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occupancy they show basically a static picture all year so while all the noise has been about return to office you
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haven't seen an increase in office occupancy it stayed flat at around 50% you know wibbles up and down a little
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bit down a bit in the summer back up a bit afterwards when you look at the surveys it's the same and so we've
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stayed where we were I think we're still trying to negotiate what the future is
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going to look like but increasingly I think companies have kind of settled into a variety of different modes um and
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I think in a way that is um pre pandemic we basically had a one-size fits all like every company you know they might
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have a couple of people remote but basically normal as you're in the office five days a
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week um I think compared to so I remember talking about this with people last year and I was saying I could see
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three scenario iOS for remote work so one is there's a recession just everyone
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gets dragged back to the office a second one is kind of a new normal where it's
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like three days a week in the office for everybody and a third is kind of horses
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for courses where kind of different companies have completely different policies depending on what works for
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them I think we're moving towards that third that third scenario and so I think
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there's kind of be the aggregate statistics haven't changed but I think there's been some clarification and I
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think we're moving towards a world where different companies are settling in
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completely different policies and practice so that's one thing that in a sense hasn't changed so much the third
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thing is you mentioned AI um yeah it has seriously impacted a few jobs so I think graphic designers have
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had a really rough year um I think the people who have run these paper mills where they kind of sell essays to
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desperate um college students I think chat GPT has devastated their business I'm not so unhappy about that but um if
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you look at the average um employee it hasn't yet been right and you know I mean there
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were there were some clearly ludicrous takes this time last year that you know within six months various kinds of work
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will be dead that was obviously wrong I me I think what's happening is like I
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said all predictions are wrong what's happening is reasonably predictable which is it's happening slowly like I I
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think it could well have a big impact on many jobs but this year has been a year
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of people starting to figure out what's happening with it rather than wholesale
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implementation do you think then the impact will be complimentary to the workers that are in the workplace or is
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there an element where you are still focused on how much it could take away like the leadership of companies see the
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benefits of AI they know how it can can save on the bottom line by by not having
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employees or is there a even a little bit of a combination of both of those I mean I I would have thought it's going
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to be both right I mean I you know everybody is saying it's not people or AI it's people with AI and right I'm
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sure that's true but you know if people with AI is a good solution ultimately
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you probably need fewer people for a lot of and so the question is when we have people with AI does it drive down the
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cost so much we can expand the market and hire more people or once we have people AI do we just need fewer people
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and probably across different occupations it's going to be different let me uh go back to talking about
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remote work because as this all started to develop uh we obviously had to have remote work because of the pandemic and
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as the return to office was was playing out I I just had the sense and this is my opinion uh that we were eventually
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going to see and it may be a longer period over time that we will get back to pretty much everybody being back in
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the office but it doesn't even seem like that's the case like companies have
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adjusted and they understand what kind of The New Normal is uh the voice of the employee maybe has a little bit more
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bite to it than it did back in 2019 what they want around remote work and these benefits obviously has a little bit more
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bite to it where do you think then remote work is kind of headed I mean the way I think about it um what Co taught
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us I mean it just remote work was unimaginable right pre preco this idea that could do most of our work staying
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home just didn't even occur to us right then we do it and we can do most of our
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work and I think what it made Salient was the cost of coming into the office like so a lot of people have a commute
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that's half an hour or an hour each way right so that's an hour or two hours of
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their day just to get into the office sure um and so the question is when are those costs
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worthwhile and I think kind of the previous answer was every day you should be here not really I mean there's a lot of
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work I get done as well and in some cases most people find that the kind of the focus work the Deep work they do
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better at home yeah um and so if most things I can do just as well and I don't
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have to incur an hour or two hours cost and by the way that cost is not just mine right that that is to some extent
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coming out of my budget for time that I can spend on work things so I'm going to
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do less work as well because I have to do that Comm if I can take that and turn it into productive time what why would I
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be coming into the office sure yeah now there are some benefits to being in person um it's good for building trust
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it's good for managing difficult conversations and tricky conflicts it's
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good for getting to know a broader range of people than those who we just kind of
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encounter directly through our work it's good for mentoring and so there are
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definitely some things that we do better in the office so there are benefits of being um in the office there are cost of
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going to the office and so I think where we have tended to come out you that ratio looks completely different for
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different companies and different kinds of work if the benefits are huge so if I'm a financial services company where
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most of my employees are under the age of 30 right well actually a huge amount of what I'm doing is mentoring and
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training sure and they all frankly we're all in New York so they have pretty
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short commutes yeah then the idea that actually the benefits of being there in person that way the cost that's
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plausible but in most cases actually would say given there are benefits and there are cost we want to bring in
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people for some purposes so at the beginning of a project we should all come together when we hire new employees
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they should be on staff we want to have some All Hands meetings from time to time yeah where everybody's here you
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want to do that to get those benefits of being in person but we can get probably
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80 90% of those benefits right while incurring like 10% of the costs by only bringing people in once a week once
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every two weeks and so you're seeing I think depending on the kind of work people are doing different ways of
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balancing those costs and benefits and I I think to most people it just seems silly now that kind you have to be there
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every day and keep incurring those costs with seriously declining marginal benefits so off of that then where do
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you think companies mindset mindsets are right now about their employees about retaining them about losing them because
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that you know go back to 2021 and early 2022 it was a massive concern because you saw such a high level of turnover
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the quits rate was you know something we hadn't really talked about a lot uh but
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it became a monthly concern for so many firms so as we've hit the end of 2023
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and into 2024 where do you think that mindset is the quit R is still reasonable I mean we're not yet at a
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place you know you're in a deep recession frankly I think when I first started coming in here kind of you know
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ta end of the Great Recession you um you know you didn't have to worry too much about attrition
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because it was going to be really hard for your people to get another job we're
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nowhere near that and so if you're upset your employees they're going to leave
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and the problem is the people who are most at risk of leaving are the ones who are going to find it easiest to find
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another job and so I don't think we're in a situation where most employers can kind of say
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attrition be damned kind of we'll we'll just go ahead and do it and so you want to be you want to be the
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most attractive employer you want people to be excited to come to work for you and you want them to be excited to
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remain working for you and given for most people the flexibility of remote work the ability
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to do it as at some point is something that's important to them it's still um
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you are handicapping yourself in competing for talent these days if you have a kind of 5day in the office policy
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how do you think the mindset of either the manager or the seite has had to change because of some of these Dynamics
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I it's really tricky you know I spend a bunch of time talking to chro and on
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this topic um it's funny kind of the first thing that everybody says when they explain their policies well my CEO
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believes that right right um and part of the challenge is there's not yet a lot
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of great data on this topic a huge amount is being driven by CEO beliefs um and they miss the buzz of a full office
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right sure there's an excitement there and again I'm not saying that um remote
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workers is Costless right but it's about balancing the costs and benefits and I
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think they have been I mean it varies hugely from organization to organization there are some CEOs that have really got
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on board with this and kind of said this is what we need to do for our talent it's a new way of working we can make it
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work I think there are a bunch of other CEOs that kind of still vaguely believe if I can't see them working I'm not sure
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they actually are and it's a big mindset shift a lot of discussion around the
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issues of mental health and stress espe especially in the workplace how do you think companies have adjusted to that
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and and where that potentially is going it's a great question it's something
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that I think we didn't really talk about in a corporate context four or five
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years ago um I think Co really brought it to the four and so yeah is wherever you get two or three HR professionals
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gathered together these days they'll start talking about mental health it's
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it's a huge priority um I think companies are starting to take it very seriously sadly I think the issues are
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more serious particular when you look at kind of the incoming Generations there are these terrifying statistics about
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how mental health among kind of young people has declined over the last 10 years or so and obviously they're
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starting to sharpen the workplace um I'm not sure anybody quite knows what to do
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about it I mean again it falls into this conversation it's kind of another dimension of inclusion um another thing
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you want to be thinking about about how do we manage stress how do we manage burnout so it is clearly a part of the
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conversation now I'm not sure yet to what extent it's really starting to
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inform how people manage so as we turn the calendar to 2024 what are you watching what are you most interested to
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keep an eye on in and around careers labor workforce I mean I think these are these Remain the big trends um are we
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going to see big impacts of AI um again the evangelists think it's just around
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the corner I'm thinking it's in the years until it really starts to um starts to
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show up in the labor figures but I've been proved wrong many times in the past
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so I look forward to being proved wrong here um I think that's the one everybody
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wants to talk about um we've seen a cooling off in the labor market um what's going on in the economy um is
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is we've been again serially wrong right I mean this time last year everyone was
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clear we were going to have a recession in 2023 and we never did now everybody's
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convinced that it's a soft Landing we should probably start worrying well it's
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just cuz I'm a died in the W pessimist which grow happens if you grow up supporting England
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um I if you ask me is the labor market going to be tighter or looser this time next
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year I would probably bet looser but I think it's just my my pessimism I think
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there there downside risks I think particularly concerning the interest rates will bite over time um but that
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that'll have a big effect I mean on the other hand I guess you will see um you
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know the infrastructure Bill the inflation reduction act all of those really starting to kick in yeah as money
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goes out the door um like I say I think the most encouraging thing about the last three years has been that the big
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growth has been at the kind of lower end of the wage distribution um and I think we should continue to see growth
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particularly in manufacturing and other Blue Collar roles so I think that is that is definitely a positive thing that
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I hope we'll continue to see over the next over the next year or so Matthew always great to chat with you thanks
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very much and you thank you Matthew Bidwell professor of management here at the Wharton
00:16:27
School