Every year I give my top 10 workplace trend predictions for the upcoming year. You can read my predictions from 2013, 2014, and 2015 if you missed them. These trends are based on hundreds of conversations with human resource executives and workers, a series of national and global online surveys and secondary research from more than 100 different sources. The major economic and business themes over the past year have been focused on companies doing more with fewer resources, the skills gap and further advances in technology that have given rise to security issues.
Some of the major trends for next year include healthcare in light of Obamacare penalties increasing to the maximum in 2016, the flexible yet modernized office space and the first group of Gen Zs starting work in May. As with every year, there are some significant obstacles such as workplace planning, the war for talent, adapting to change and training the next generations of workers. While these might be challenges, there are also great opportunities for companies to automate, modernize and lead in 2016.
1. The acceptance of boomerang employees and the challenges for job seekers.
A boomerang employees is one that leaves a company only to return later, a decision that is typically based on compensation, opportunity or family affairs. In a recent study, we found that 48% of companies had a policy against hiring boomerang employees in the past, but now 76% say they are more accepting of hiring them. This trend is happening because professionals are switching jobs more often, and the access to talent through technology is greater than ever before. Companies have recognized this and have created LinkedIn groups, Facebook groups and email groups so their former employees can stay connected. The benefits of rehiring former employees are that they are familiar with the company culture, don’t require as much training and have a new perspective. Boomerang employees are another nail in the coffin for active job seekers who always have to compete against employee referred candidates, internal candidates, passive job seekers and customers.
2. The leadership gap will start being filled as boomers retire in numbers.
Next year, more than 3.6 million baby boomers are set to retire and more than one-fourth of millennial workers will become managers. Succession planning and next generation leadership development will start to be prioritized next year. In order to cope with the loss of boomers, companies will be hiring some back as consultants and advisors to current executives as well as new or upcoming leaders. Based on our global study, we found that companies need to offer regular feedback, instead of annual performance reviews, and virtual learning instead of printed manuals. In a follow up study, we examined the strengths and leadership styles of millennials and found that they are transformation leaders, which is different than boomers who are autocratic leaders. Ninety-one percent of millennials aspire to leadership positions, and their biggest weaknesses are technical expertise and influence. This new generation will fill the leadership gap by flattening corporate hierarchies, empowering others to succeed and forcing companies to make an impact on society, rather than just focusing on money.
3. Workplace flexibility becomes the biggest topic of conversation.
In study after study, and interview after interview, the topic that just keeps coming up is workplace flexibility. It’s such a big topic that it even relates to the other trends on this list and affects us all in some way, shape or form. First, we work 47 hours per week now, and there is no longer such a thing as a 40 hour workweek. Second, another study we did found that 64% of managers expect their employees to be reachable outside of the office on their personal time. As a result, another study we did found that more than half of workers feel burned out. Third, more employees are willing to either switch employers or stay at their current employer, based on their flexibility programs. With the rise of telecommuting, co-working spaces, globalization and new technology tools, workers are demanding flexibility. In the next few years, nearly every company will have a policy, especially because we are getting ready for the next “baby boom” when 80 million millennials have children.
4. Wearable technology is taken more seriously and disrupts business as usual.
While many companies haven’t taken wearables seriously, you will see a surge in popularity and acceptance in 2016. One study suggests that the wearable market will grow to $80 billion by 2020. Wearables will be driven by Gen Z’s entering the workforce next year, as well as by millennials. One study found that 71% of 16 to 24-year-olds want wearble tech — 33 million devices were sold globally this year, expected to grow by 35% over the next few years. Some of the more popular wearables are Fitbit and Apple Watch, and they are being used in the workplace mainly to track health and wellness and productivity, based on our research. We see that wearables will create even more use cases next year as more employees bring them to work and the business value is recognized and measured. Wearables take advantage of our 24/7 business environment, retrieving information and helping workers be more efficient with their time.
5. Companies get serious about office design and use it as a way to increase collaboration and attract top talent.
With the rise of collaborative technologies, generational preferences, globalization and an employee’s desire for work-life balance, the office is becoming more decentralized, and space is shrinking. By 2020, the average amount of space per employee will drop to 150 square feet, down from 400 in 1985. Furthermore, 60% of more employees aren’t even using their assigned spaces. More employee are working remotely, and companies can save millions of dollars by shrinking their offices. Companies will move away from open offices and create multi-facet office spaces that give employees options. Some employees work better in cubicles and others work better in a lounge or cafeteria. Based on our research, employees want flexible furniture, a distraction-free environment and lounge areas. Companies will have to pay close attention to their office environments and invest in improving them so employees can be more productive and happier at work.
6. Obamacare takes full effect, causing premiums to surge and companies to pass more costs to employees.
In 2016, Obamacare penalties will go into full effect and force more companies to hire freelancers over full-time employees. For individuals who don’t have health insurance, they will be fined $695, which is much greater than the $95 penalty in 2014. Next year, 95% of companies with 100 or more employees will need to be insured, and companies with 50 to 99 employees will have to insure full-time workers. Blue Cross of North Carolina, for example, has already raised their rates by 35%. This could lead companies to lay off workers to save money, which puts more pressure on current workers to do more with a smaller headcount. It also adds more work for the HR benefits department. Talent is the greatest cost to companies, and expensive healthcare benefits will only become more expensive next year. In order to remain profitable, and please shareholders, companies will have to hire freelancers and remove some or all full-time workers.
7. Companies figure out how to automate more jobs and modernize their workplaces — at the cost of employees.
There are a lot of factors that have led us to believe automation will be a major force next year in our economy. The contributing factors include: minimum wage increases, companies striving to create more business value with fewer expenses, the rising costs of healthcare, pressure to be modernized and advances in robotics. It is predicted that machines might be able to do half of our jobs within the next two decades. Automation is impacting all types of jobs from bank tellers to cashiers to receptionists to mail carriers and even telemarketers. Employers benefit by creating a more efficient production line and lowering the cost of talent, while workers have fewer jobs and more pressure to produce or be replaced. While automation is still in its early phases, more global companies are experimenting with it, and when it works, there will be widespread adoption. For instance, McDonald’s Europe installed 7,000 touch-screen computers that take your order and track food items. While many people think that automation is bad for workers, like in every era, old jobs will be lost and new jobs will be created.
8. The first group of Generation Z graduates from college and enters the workforce.
Generation Z, born between 1994 and 2010, will enter the workforce starting next May. This generation is jaded from the recession, suffers from student loans and has learned a lot being the children of Gen X. Compared to millennials, our research shows that members of Gen. Z are even more entrepreneurial, loyal, flexible and realistic in their approach to careers and purchasing. They choose opportunities for growth and work-life balance over salary when selecting what company to work for. Like millennials, they will seek mentors and supporters because they are first starting out in their careers, and they will be even more connected through technology. About a third desire to become managers in the next five years already, and 45% believe working with boomers will be challenging.
9. More professionals seek gigs instead of full-time jobs as the sharing economy and freelance marketplaces expand.
Due to the imposed costs of Obamacare, an employee’s need for more flexibility and technology creating new jobs, the gig economy is set to take off. Professionals choose freelance jobs in order to gain more control over their lives, have flexibility and be their own boss. By 2020, about 40% of Americans will be part of the gig economy, and Uber already has over one million drivers globally. The trends that have created the gig economy include: the rise of freelancing, the access of technology (especially on the mobile phone), the impact of the recession and the desire to have “side-gigs” and flexibility. For employers, the gig economy allows them to hire on-demand, lower costs and have more competition for talent.
10. Maternity leave becomes an even bigger discussion as an important employee benefit as we enter the next baby boom.
More companies are expanding their maternity benefits to compete for top talent and to better retain current employees. In the next few years, as we enter the new baby boom created by the millennial generation, this employee benefit will only become more important. Currently, only 1% of companies offer unlimited maternity leave, yet 64% of employees say they want it. Netflix led the way this year with its unlimited maternity leave policy, and Adobe and Microsoft followed suit with their own expanded programs. Currently, only 13% of people in the U.S. have access to paid family leave. Another big movement is fathers being able to take leave as more women become breadwinners in families. 76% of fathers go back to work in one week or less when they have a child. We are due for some major maternity benefit changes in the next year.