Worrying new ‘wake-up call’ for Australian employers

Workplaces across the country have experienced a big power shift in the favour of employers, but bosses have been warned a brutal “wake-up call” is looming.

On the surface, it seems as if employers have all the power right now.

Employee retention is high and continuing to rise, with unstable economic conditions and the worsening cost of living crisis meaning workers are reluctant to take the risk of jumping between jobs.

This has resulted in a major power shift within the workplace.

In the aftermath of the pandemic, employees retained a lot of bargaining power, with remote and hybrid work the new normal and a high demand for workers.

Now, with staff looking to retain their current roles, the ball is back in the employer’s court and they are able to make unpopular demands with little pushback.

We have already started to see this play out in Australia, with NSW Premier Chris Minns recently announcing remote working privileges introduced in 2019 would end, with all public servants forced back into the office.

While the current circumstances may seem idyllic for employers, they have been warned to tread lightly or risk facing disastrous circumstances in the near future.

Employers have been warned that they could see a significant amount of employees looking to leave their roles within the next few years.

While the Australian Bureau of Statistics recently recorded a decrease in job mobility for the first time in three years, new data released by employee engagement platform, Reward Gateway, found that employee engagement is at in all time low across the country.

So, while Aussie workers are staying in their current roles, they are doing so due to market conditions, rather than genuine satisfaction or happiness.

A survey of more than 2300 Australian employees and business and HR decision makers found employers are likely to find themselves in a worrying position within the next few years.

Of those surveyed as part of The Engagement Paradox Report, 55 per cent of employees said they were looking to change roles within the next two years. A whopping 74 per cent also said they would leave their jobs when the economic climate improves.

Speaking to news.com.au, Kylie Green, Managing Director APAC at Reward Gateway, said this research is a “wake-up call for Australian businesses”.

“Current strategies are not effectively addressing the root causes of disengagement and underperformance,” she said.

Kylie Green, Managing Director APAC at Reward Gateway, said the research is a ‘wake-up call’ for employers. Picture: Supplied

“Leaders need to bridge the gap between management and employees, prioritise employee wellbeing, and foster a culture of appreciation and support.

“Failure to act fast will mean organisations risk losing valuable talent once the market stabilises.”

Ms Green warned that if this disengagement trend continues, then we could “absolutely see a more balanced, or even employee-favoured dynamic emerging in the coming years”.

Over a quarter of Australian employees said they feel less engaged with their work now than they did 12 months ago.

This is a major point of concern for employers, with 87 per cent of business and HR leaders acknowledging the negative impact of poor engagement on employee and business performance, and over half estimating that low employee engagement costs them between $20,000-$100,000 each month.

This is putting increasing pressure on other employees and leading to higher rates of burnout, with half of those surveyed saying they are picking up the slack of underperforming employees.

Other key drivers of workplace dissatisfaction include the cost of living, stress and a lack of appreciation and recognition at work.

More than half of the employees surveyed said they were looking to change their roles within the next two years. Picture: The Engagement Paradox Report

Penny Locaso, 48, knows first-hand what it is like to feel disconnected from your work to the point where you start questioning your role.

She had a high paying job in Melbourne for 16 years where she managed the cultural evolution of a company that went from 200 to 1000 people in two years.

Despite her outward success, she eventually came to realise her work was leaving her deeply unfulfilled and burnt out.

She eventually left the role in 2014, but she said it took her a while to get to that point, despite feeling disconnected from her job for some time.

“It was not like a light bulb moment. It was more a dimmer that gradually turned up over time. I started to notice things that, I think in hindsight, the signals were always there, that were not in alignment with my values,” Penny told news.com.au.

“And it was as if I got to a point where I couldn’t ignore them anymore. And so it was probably in the last 18 months of that career.”

It wasn’t just one event that led her to the realisation she needed to leave, it was a series of events, different meetings she was in, decisions that were made and the direction the company was going.

“When I asked myself ‘what is it that makes me feel like I’m doing meaningful work?’, I quickly realised my values were human connection, positively impacting the lives of others, being present in a moment, and a sharing experience. The culture I was in didn’t value these things,” she said.

“What was valued was doing, being busy, and it came at the cost of creativity, innovation and human connection — that was the disconnect.”

Many of those surveyed felt deeply impacted by the cost of living and a lack of recognition at work. Picture: The Engagement Paradox Report

The moment that cemented her decision to leave was when she had been transferred to Perth for a secondment. At the end of those two years, her employer asked her to relocate there permanently.

“That was a defining moment. They were asking me to drop all of the benefits I had as someone who was on secondment. This meant if I ever wanted to come home, it was going to come at a significant cost,” she said.

Having a young son, relocating permanently to Perth would also mean sacrificing the support of her family and friends.

It was then that Penny decided to leave her role and take her chances moving back home, a decision she said that has paid off in droves.

It afforded her the flexibility to prioritise the values she was missing in her previous job.

“The work I do now still lights a fire in my soul. Every day I’m elevating women to grow their impact creating a ripple effect of flourishing in society and a more inclusive and brighter tomorrow,” she said.

For other Aussie workers who may be finding themselves feeling disengaged from their work, Penny’s advice is to “stop ignoring the feeling and get curious about it”.

“Don’t squash it as it will only grow bigger and more disruptive to your everyday functioning,” she said.

Even though the current economic conditions mean employees are staying in at their jobs longer, employers have been warned that staff still need recognition in order to do their best work and feel valued.

Ms Green noted that it is easy for recognition to fall by the wayside when things get busy or challenging in a company.

“But the ripple effect of something as simple as recognition is outstanding, and something that certainly shouldn’t be overlooked,” she said.

“Making rewards and recognition a priority for your team’s every day achievements is a simple, yet powerful way to make them feel seen and valued, which can really help boost morale.”

Employers are also encouraged to be open and honest with their teams by keeping them in the loop about the company’s plans moving forward and creating spaces where staff can voice their thoughts and concerns.

Originally published as Worrying new ‘wake-up call’ for Australian employers