Key trends driving the workforce transformation in 2022

Work is having its moment. The transformation of the global workforce accelerated in 2021, driven by the continued impact of the pandemic and strains on businesses amid record labor shortages and shifting worker priorities. It’s a strain felt universally.

2022 workforce trends

ADP Research Institute found that 64 percent of the global workforce was negatively impacted by COVID-19, including 28 percent who lost a job, were furloughed, or were temporarily laid off, and 23 percent who took a pay cut. These labor market shifts have led workers to reprioritize their needs, further redefining how and where work gets done. As a result, employers face added pressure to adjust to emerging talent demands.

“The world of work has been in a constant state of motion,” said Don Weinstein, corporate VP of global product and technology at ADP. “The needs of the global workforce are evolving in tandem with technology, and the result is transformational. Amid all the change, one common thread has only grown stronger: people power performance.

“To support and empower their people, employers are rooting their decision-making in data and leveraging those insights to better understand their employees’ needs and what drives their productivity. This increased visibility is fostering a stronger sense of connection and paving the way for greater growth and innovation ahead.”

Trends shaping the 2022 workforce

Employee visibility will be redefined

As employers explore on-site, fully remote and hybrid workplace models, they will look for new opportunities to increase employee visibility and better understand the needs of a dispersed workforce.

According to the study, within a year, COVID-19 has significantly impacted workers’ locations. In fact, 75% of the global workforce made changes or plan to change how or where they live, with that percentage even greater (85%) among Generation Z. Additionally, ADP surveyed small and midsized U.S. employers and found 66 percent have a hybrid work model in place.

To foster connection in the absence of physical proximity, people data will shed insight into the ebbs and flows of engagement and performance, helping managers pull the right levers to support a high-performing remote or hybrid team. This new dynamic built on mutual trust will help drive employee engagement and performance. U.S. employees who have trust in both their teammates and their team leader are seven times more likely to feel Strongly Connected to their organization.

People and purpose will drive workplace culture

As employers look for ways to drive inclusion amidst new work models, connection will become a measurement of workforce culture. ADP Research Institute found that U.S. workers who feel they are Strongly Connected to their employer are 75 times more likely to be Fully Engaged than those who do not feel connected.

With connection driving engagement, employers will need to heighten their focus on their people and reflect on the larger purpose that unites their workforce. Workforce flexibility will stretch beyond perceived limits and employers will embrace people-centered initiatives to build a workplace where everyone can thrive.

Diversity, equity, and inclusion strategies will additionally evolve to drive true, measurable progress. ADP data shows more than 50 percent of companies that leveraged ADP DataCloud’s DEI analytics capabilities have taken action and realized positive impact on their DEI measures.

Reliable data and expertise will power resiliency

With employees remaining remote and hybrid, operational and compliance considerations will grow, adding to an already complex regulatory environment. In fact, the survey found nearly 20 percent of U.S. companies with 25 to 99 employees admit they are currently facing challenges with compliance and regulatory issues, which may increase as regulations change. To navigate forward, leaders will rely more heavily on real-time data to tackle compliance proactively and guide decision-making.

Quality data will be key in providing businesses with the confidence they need to act. As an example, to better manage return to the workplace policies including vaccination tracking and testing, employers are turning to timely people data.

Greater innovation will accelerate growth

As business models evolve amid global shifts, businesses will turn to technology to drive efficiency and expand capabilities by eliminating task work and refocusing efforts on strategic growth initiatives.

With roles evolving, a surge in skills-based hiring will drive innovation further. The study found 28% of workers report having taken on a new role or changing role due to pandemic labor market shifts. The number increases to 36% for Generation Z workers.

Following a period during which employees were forced to reskill, people will continue to prioritize their skills and pursue opportunities to apply their unique strengths. To accelerate performance, employers will need to focus on those individual strengths and provide opportunities for employees to develop new skills or embark on a new career trajectory with more opportunity for growth.

Additionally, employers will also rely on helpful technologies like machine learning to identify workers with the right skills in unique places, such as pools of former applicants who previously applied for other roles.

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