The workplace trends that will define 2023

Several months ago, when Macy’s Inc. was looking to hire roughly 40,000 temporary workers for the holiday season, John Patterson, the company’s VP of Talent, had one small request: Don’t post any “We’re Hiring” signs.

“Honestly, everybody’s hiring,” he said.

To stand out in a tight job market, the company created a “new expression around candidate branding,” Patterson said. Instead of “we’re hiring,” the message “bring your awesome self to work” appeared in job ads across stores and on the company’s website.

It turns out that a simple language tweak — plus raising department store wages to $15 an hour — was the key to fully staffing stores and warehouses ahead of the year-end shopping rush. Macy’s will enter 2023 with 97 percent of corporate jobs filled, and close to that number for hourly roles, Patterson said.

“It’s hard, there’s heavy lifting, but it feels like we’ve got good talent and they’re sticking around,” he said.

For talent managers, this year was all about crisis management: workers were quitting at record rates, and labor shortages made those jobs hard to fill. Companies struggled to set new guidelines for everything from pay to telecommuting as the pandemic’s aftermath worked its way through the labor market.

Unpredictability will be a recurring theme in 2023 as well, experts say. Although many companies have worked out big questions from the pandemic era, new ones are on the horizon. They include a potential recession that will require layoffs in some areas, even as labor shortages keep some key roles unfilled. Keeping employees engaged in tough times, and maintaining a commitment to justice as the energy of 2020’s social justice protests wanes, is both a challenge and, in many cases, a mandate.

Here BoF explores three workplace themes to watch in 2023.

Retention rather than recruitment

Many fashion companies have spent the last two years responding to talent shortages in areas such as supply chain, technology and sales. As labor shortages peak in 2022 and “The Great Resignation” shows that companies shouldn’t assume employee loyalty, more companies are starting to tilt their talent investments toward retention over recruitment, experts say.

“Rather than overhiring now or [resorting] for layoffs in a recession, there is a real opportunity to think about how you can groom and leverage your talent or create cross-functional roles in these businesses,” said Lisa Yae, managing partner of the Retail & Luxury Goods Practice at Hanold Associates.

By 2023, companies will need to place greater emphasis on offering opportunities such as education subsidies and training programs, weave flexibility into all job functions, provide consistent face time with leadership, and help their workforce see long-term growth opportunities within the organization.

Macy’s now offers an education benefit where employees can earn four-year college degrees that are fully paid for by the company, Patterson said. The company also sponsors certificates, training programs such as “English as a second language”, cyber security, product management and courses for other “hot skills” that they believe will be useful in the department store in the future.

At True Religion, Theresa Watts, senior vice president of human resources, diversity, equity and inclusion, said the company has learned that pay raises and fancy job titles alone aren’t enough to keep people engaged at work.

“In 2023, I’m investing in areas like employee relations and giving our people things like paid volunteer hours and more time to have personal lives,” she said. “We can’t have people who quit without a job lined up because they are [desperate] to have more time with their families.”

As the economy cools, companies should resist the temptation to reduce their talent investments and, where possible, find ways to use existing talent instead of job cuts to avoid repeated labor shortages later, Yae said.

The new C-Suite

The past year was a turbulent one for fashion’s C-suite – CEO changes occurred at The Gap, The RealReal, Glossier and Chanel to name just a few – and the turnover trend could accelerate in 2023, experts say. The shakeout could create an opportunity (and challenge) for HR leaders and boards to redefine who should lead a fashion company, said Paula Reid, president of Reid & Co Executive Search.

In a hybrid office culture where employees are assertive in their expectations of flexibility, effective leaders must be top-level communicators who consistently demonstrate agility, openness and empathy, experts say.

“We’ve always talked about hard skills versus soft skills in leadership — the soft skills have really changed in a really significant way,” she said. “Leadership is now so much more about partnership, creating openness and developing community.”

New and evolving leadership roles in areas such as diversity, sustainability and environmental, social and governance could also take shape significantly in 2023 as more UK and US regulations come into effect and companies begin to learn how to design these functions more effectively, Yae said.

“We’re seeing a lot more of these roles being blended,” she said. “Some organizations realize that while [diversity, equity and inclusion] and ESG are both important issues, there tends to be so much crossover that maybe one [area] could fall under the other.”

However, companies need to be careful how they perform their DEI functions next year, as the high turnover that plagued the role of chief diversity officer in 2022 is a concern for many minority employees and consumers who worry that fashion will recede, Devin Wheeler said , president of Bond Creative Management.

“The investment we’ve seen in companies in terms of elevating their positioning, their dedication and thoughtfulness around diversity is important for many reasons,” he said. “Companies really need to continue to focus and invest in these things.”

Address blind spots

As hybrid working models become the norm and more employees expect flexibility and balance in their daily lives, fashion companies will need to consider how new ways of working affect their corporate culture and ensure their leaders are able to foster community and measure employees. performance in a fair manner.

For example, while many companies—willingly or unwillingly—have adopted telecommuting in some capacity, managers who prefer their teams to be in the office may have a bias against those employees who choose to work in person more than their peers.

“What is the right balance? How do you think about performance in a fair way?” Yae said. “How do you make sure that promotional opportunities are fair when you have half of a workforce that chooses to come in, half that comes weekly, and others that are completely remote?”

In many cases, new work models require intentionality, agility and openness on the part of management, Watts said.

“We need to focus on culture building, leadership development, mentorship and strengthening connections when people are working remotely,” she said.

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