2022 Strategy, Labor Market

Staggering power shift requires “employee-centricity”

Employee power shift, two employees pushing a lever together

Two pretty mind-blowing statistics are telling you something important about where your company needs to go – are you listening? Let’s take a look at what’s happening in the market right now:

  • At least 1 in 4 people – totaling over 40 million Americans –  quit their job in 2021. Referred to as the Great Resignation, this record-breaking mass exodus from the workforce is sending loud and clear signals for businesses to correct course in order to avoid losing more good people. Though you may have already read about this stat, the next one is staggering …


  • There are over 11 million job openings in the United States today. Coupled with the Great Resignation trend, the key takeaway here is that competition is fierce. With so many job openings for workers to choose from, companies need to double down on putting their best face forward to attract job seekers looking for very specific opportunities.


What does this mean for companies gunning to win the war on talent? It means it’s time to re-evaluate whether you’re poised to survive and thrive in a job market, unlike anything we’ve ever seen before. Given current supply and demand, employees overwhelmingly have the upper hand right now, and companies need to turn their lens inward to see if you’re prepared to meet them where they are.

Let’s start with an example.

To see the power shift to employees, turn to the skies

Nearly all major U.S. airlines are struggling with employee loyalty right now, providing a very timely example of this situation. 2,300 U.S. flights were canceled on Saturday and Sunday of Christmas weekend, with more than 3,500 more grounded globally. While it’s true that storms and COVID played a role, this massive disruption was primarily fueled by employee absenteeism. Meaning, a horde of pilots and flight crews simply did not show up for work. The old adage – “actions speak louder than words” – certainly rings true here.

As a result of all the cancellations, airlines took huge profit hits and sustained significant blows to their reputation. And it’s not over yet! The industry has canceled more than 29,000 flights, or about 8 percent of all scheduled trips, since Dec. 25th. 

Can we blame COVID for this one? In part, sure. But two airlines, in particular, spoke out to say their cancellations weren’t related to the virus. And if you look closely, you’ll notice that airlines with less than stellar reputations for how they treat employees were impacted more significantly than those known for taking care of their staff.

For example, Alaska Airlines purportedly only had a handful of cancellations related to crew exposures to COVID, yet they canceled 144 flights on December 26th – 21% of their schedule for the day. In stark contrast, Southwest Airlines canceled just 1% of their daily scheduled flights two days after Christmas, and the cancellations were caused entirely by weather, according to Southwest spokesman Dan Landson.

What’s deeply interesting about this is Southwest has a mantra; airline employees come first. The Dallas-based airline, frequently recognized as one of the top carriers in the U.S., has clearly honed in on the trickle-down effect of happy employees translating to happy customers. So while it’s hard to completely avoid conflating weather and COVID as factors, it’s clear that there’s an obvious correlation between employee satisfaction and outcomes here.

Absenteeism causing this degree of disruption is a signal that airlines need to closely examine how they’re treating employees. Pilots and flight crews, who are surfacing internal operational issues in the media, seem to agree. Exposing poor scheduling with tight drop-offs and pickup times, a lack of available hotels, and a general disregard for employee wellness – airline workers are fed up. Now, some crew members are putting their employers on notice while scoffing at the triple bonus pay being offered to keep flights staffed.

Throwing money at people to put a bandaid over deeply internal structural issues is not an acceptable solution. Businesses need to look deeper and identify where internal fault lines exist. Without employees, your business ceases to exist. And without engaged, happy employees, your ability to scale and provide exceptional customer service suffers. 

So what emboldens employees to take a stand and demand more from their employers? The big driver is not a surprising one. That’s right; we’re talking about COVID.

COVID gave talent the silver lining of so many more options

The labor market is flexing, and companies that don’t bend will get left behind. As with most things, a lot of the big changes we’re experiencing have deep ties to COVID. 

Why is it having such an impact on today’s workforce? It’s the perfect storm.

  • Savings + Stimulus + Sparse Spending = Sidelines
    JPMorgan found that half of the 2.9 million people who lost jobs during COVID aren’t looking for a new one. Throughout 2020 and 2021, lots of people were able to collect stimulus money, many collected unemployment money plus a bonus, and spending went way down. 900,000 of these folks opted for early retirement. However, two million other individuals who were previously part of the workforce chose to take some time to sit on the sidelines and wait out the right opportunity. JPMorgan predicts they will start to “drift back to employment” as their pandemic savings dwindle.


  • We all barely survived 2020 and 2021, enter the great reconsideration
    Let’s see… it started with the pandemic. Add a little toxic work environment, and toss in some major family stress. Voila! People are burnt out.

    Lots of companies lost a swath of employees due to layoffs early in the pandemic. So naturally, they started hiring people right back as soon as possible, business slowed, and the remaining employees got to take some time to take care of their imploding home lives, right? Absolutely not. Demands increased, and employees quickly found themselves overworked, overstressed, and exhausted. Not to mention the fact that many companies were not adequately tooled to pivot to remote work, so many employees were left working with subpar tools.

    As a result, high-demand employees are moving between jobs citing that their current employer has too many requirements in place that are not worth the paycheck. The ability to work remotely, spend more time on meaningful tasks, and have more flexible hours rank high on the list of perks these workers are seeking out.


  • Everything is more expensive
    Inflation is on the rise, salaries are on the rise (though in many cases, not at a rate that keeps up with inflation), and government spending is off the rails. That shouldn’t be a problem, right? For knowledge workers, it’s not – but for many companies – it’s a big issue. Job seekers looking for a new opportunity aren’t jumping at anything that crosses their path. Instead, they’re holding out for the right company with the right offer.


  • It’s all about flexibility and life balance
    The pandemic gave many people who had never worked fully remote before a taste of the freedom that comes along with working from home. Need to do the dishes on your lunch break so you can enjoy more time with your family on the weekend? No problem. Every job that was afforded the ability to go remote, did – and it gave folks a taste of what a more balanced existence is like. Now, they want more, and many are not willing to compromise.


Long story short, talent has more options than ever before – especially because many employers are offering more remote opportunities, opening up new positions to more candidates. So what’s next for companies that want to compete?

Modern workforce
Successful companies are smart about meeting modern worker demands

There’s a bit of a ransom situation happening with employees and business owners today. As we touched on above, qualified knowledge workers are desperate and hungry for flexibility, remote work, options, and autonomy. However – business owners, many of whom have always worked in a physical space with colleagues, are resisting this change and are anxious to get back to the status quo. Will this divide result in challenges with recruiting? Onboarding? Engagement and retention? A resounding yes on all points.

When you look at the big picture on how being employee-centric impacts an organization, there’s a lot to unpack. But the undeniable fact is that employee-centric companies scale better and generate more predictable ROI because happy employees create happy customers. In turn, happy customers generate a better company reputation, more referrals, and predictable business growth, ultimately resulting in a more lucrative balance sheet.

Back to the Southwest Airlines example, a company blog post on culture reads, “We believe that if we treat our employees right, they will treat our customers right, and in turn that results in increased business and profits that make everyone happy.” They even drill down a bit deeper with this: Southwest Airlines has the magic formula that makes us an admired company:  Happy Employees=Happy Customers=Increased Business/Profits=Happy Shareholders! Despite falling victim to the same pandemic stumbling blocks faced by all airlines, the airline known for LUV is literally and figuratively healthy and poised for growth.

How to become employee-centric

Considering the state of the market and the need for companies to be competitive, significantly more thought needs to be put into mapping out the full-funnel employee journey, which we’ll talk about in detail in a future post. As a starting point, here’s some broad guidance to help you determine where your company is today.

Here are the top 3 things businesses need to do to thrive in today’s market – starting with recruiting.

  1. Recruiters need to be calculated in their aggressive pursuit for top talent. To do this effectively, job descriptions and career pages need to be prescriptive. Talent leaders need to learn what their top candidates want and put those things front and center. Focusing on the right things is critical, and if you’re going back and forth with a qualified candidate over a small salary negotiation – stop! They have a lot of other options and it’s not worth the cost of potential long-term gains if they’re ideal for the role.
  2. Onboarding (especially remote onboarding) needs to be seamless and enjoyable for your new hire. Companies lose up to a third of their new hires to poor onboarding. This is such a sticking point for us; we wrote a comprehensive analysis on the issue. Check out part one and part two.
  3. Employee fulfillment must truly be a top priority – analyzed regularly with rapid execution to relieve any friction. Losing good employees is expensive, and the ROI potential of a well-connected, experienced knowledge worker is through the roof. The importance of retaining high-performing knowledge workers cannot be understated. 


Above all, employers must come to terms with the fact that resistance is futile. Companies not willing to bend on modern workforce demands – which are only anticipated to grow in coming years – are simply delaying the inevitable. 

But the choice is yours. Do you meet talent where they are? Or do you limit your ability to survive and thrive in today’s competitive market?

If you choose to survive and thrive, Cleary can help. 

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