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2022 in review: HR reflections on a turbulent twelve months

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It’s been a tough year but has HR learned anything and what can we take forwards as we head into the next 12 months?

5th Dec 2022
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By the time I wrote my last 'year in review' back in December 2021, the theme was very much a reflection on the turbulent year we’d all had. I didn’t expect, a year on, the word ‘turbulent’ would still be so relevant. While one crisis was fading away, another was just getting started. There’s almost too much to talk about, so I’m going to focus on one thing… people. More specifically, how the lessons we learned about people this year will help us prepare for the next. 

It's all about the people, people

For most of my career, organisations' understanding of, and commitment to, employee engagement has been growing. It was seen as a metric; they talked about it at board level and wrote about it in their group accounts. But then the world started to squeeze and stamp down on our people as we had never seen before.

We realised that their ability to adapt to fast-paced changes, their empathy and their collaboration would ensure our survival as employers

While world happiness decreased globally in 2011, it’s been falling ever since. Employers were committing more to helping and engaging their people, but were pushing against a society dragging them the other way. Financial pressures, poor mental health, turbulent economies and governments all started to eat away at our happiness and our health – and then along came the pandemic. 

But something kind of magical happened during 2020 – employers realised they needed their people. They needed their commitment, ideas and loyalty to get through the unknown of the pandemic. So we rallied around them, engulfed them in our arms and brought them closer.

We realised that their ability to adapt to fast-paced changes, their empathy and their collaboration would ensure our survival as employers. More money than ever was spent on employee wellbeing, and the pandemic advanced the adoption of mental health support at work by more than a decade. 

Refocusing on the workforce

Spread throughout a series of common challenges this year too is one consistent theme – we have to prioritise and care for people more than we ever have. And this isn’t just an HR issue, this is something CEOs must get on board with.

The Great Resignation was driven by employees putting themselves first and refusing to continue to work for inadequate pay, poor working conditions, draining cultures or insecure work. The hybrid and remote working debate is about employees wanting more choice and control over their work. The multitude of strikes has been driven by low pay and employers not keeping their promises.

This is the year that employees embraced their collective power and influence. It was the year that consumers decided that employee treatment was an important part of consuming and it was even the year that investors and shareholders realised the power of the people we employ.

We cannot continue to ignore this and must embrace our people's newfound influence. And why wouldn’t we? Because the data is very clear: when we do that, when we build around our people, everything else falls into place. Happy, healthy and engaged employees build better products, innovate more, collaborate more and deliver better customer service. 

But there’s a conflict that still exists in many organisations – preserve ourselves or preserve our people? Now I don’t think that is a mutually exclusive decision. I think in this age of economic uncertainty, it's our people that will get us through. 

The impact of the last few years has meant that employee engagement has entered its own recession

The old ways are dead – we need to move on

There is a reason why the recent decisions and actions of some well-known CEOs this year have been widely published and criticised in the media. It’s because they reflect a historic way of dealing with people that is no longer appropriate. They hark back to an era of corporate governance and leadership that has long fallen out of favour with employees. 

The impact of the last few years has meant that employee engagement has entered its own recession. In 2022, just 21% of the global workforce was engaged – that still hasn’t returned to its pre-pandemic peak. Walking back to the old ways risks already depleting staggeringly low engagement levels. The only way we will get engagement up is to work harder than ever to counteract the effects of the pandemic and the cost-of-living crisis, which means giving our people more of what they need. 

While we can change functions and options like offering more flexible working, limiting working hours, and increasing pay – what we really need to do is fundamentally change the way we treat people at work. Fairness, trust, support  and care are things your people want to feel from working with you.

I genuinely believe we can fix what we need to, it just means we need to start prioritising people over profit and people over policy. While this might seem counterintuitive as we enter a recession, the lessons from previous ones show us just how important our people are to our survival and the important part they play in how long we take to bounce back. 

How to thrive in a recession

There are clearly going to be challenging times ahead for some employees and employers, but from my experience of working in HR through three recessions, these are two of the main lessons I’ve learnt:

1. Customer loyalty is won or lost in a recession; your people will be your best chance of winning

Some organisations thrive during recessions. Bain found that there are 47% more ‘rising stars’ during downturns than during stable periods. The way to become one of those is to follow what has worked for winning companies in the past. We don’t notice great employee engagement when the going is good, we see it when we really need our people to step up. Customer loyalty is won or lost in a recession; your people will be your best chance of winning. 

2. Employee engagement matters in a recession

There are very clearly defined links between employee engagement and profitability. To sustain our operations we will need the best our people can give, and they will only give that to those employers that have given their best to their people. Embrace choice over where and when an employee works. Help them to do work they find meaningful and corral them together. 

Look after your people, tell them you care, and support their own suffering and they will step up for you

Talented employees can increase revenue per employee by 6%. Great managers can achieve 27% higher growth per employee than average. Engaged workforces can lead to as much as 18% higher growth in revenue per employee. 

Nine in ten leaders believe the economic uncertainty we will face in 2023 risks winding back the ‘pandemic progress’ we made. Prioritise your people as much as you can – the winners in any recession focus on controlling what they can control. Look after your people, tell them you care, and support their own suffering and they will step up and be there for you. 

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