5 labor sector trends expected to impact Americans in 2023

We’ve seen just how adaptable and resilient Americans are when facing obstacles in the workforce thanks to the pandemic, which drastically changed traditional workplace culture. Now that society has shifted yet again, moving back towards pre-pandemic norms, there are a new set of obstacles to overcome. It is extremely important for both organizations and employees to look ahead at what to expect in the new year, to strategically plan how to approach these challenges and create a successful working environment. With that in mind, Talent.com has identified five themes that we expect will significantly impact the employment sector in the upcoming year.

Conversations surrounding pay transparency will increase

We are beginning to see a shift towards pay transparency nationwide, with California’s legislation coming into effect on January 1 and New York City and Colorado having already implemented pay transparency laws.

A recent Talent.com study shows that nearly 35% of candidates experienced pay discrimination, and over 50% of those were women. There is still a long way to go in correcting gendered and racial wage gaps across the United States, however conversations of pay transparency and the implementation of laws across the country are moving us in the right direction.

As more pay transparency mandates roll out, we will see increased conversation surrounding the importance of advertising salaries and the impact it has on the employment sector as a whole. We believe that through increased discussion, pay transparency will become an expectation from employees.

 Employers will prioritize skill development

We do not foresee conversations surrounding upskilling and skill development to slow down in 2023. Employers understand that we are living in an employee’s job market, with more open opportunities than there are workers to fill them. Since candidates have more options than ever before, organizations are experiencing more difficulty attracting the best possible talent.

With that being said, we expect employers to promote & emphasize professional development opportunities as a tactic of attracting new talent and retaining their current workforce. This strategy works two-fold — new hires and employees are able to develop their skillset and feel as though their employer is committed to their growth & future success, while employers are able to benefit from a workforce that is continuing to update & learn new skills.

Return to increased mental health conversations in the workplace

Mental health conversations were everywhere over the last three years, especially as we went through periods of isolation. These discussions made their way into the workplace as well, and many organizations implemented programming to ensure their staff were in positive headspaces.

As another period of economic uncertainty arises in the form of a recession, it is vital to not lose momentum and continue to focus on mental health initiatives. It is very important for employers to keep the mental health of their employees in mind and enact programs to assist their team where possible. Services such as virtual counselling and wellness workshops can provide employees with a sense of relief during this difficult period, and in turn create a healthy work environment.

Compensation negotiations will become driven by benefits

 According to a recent Talent.com report, nearly 60% of applicants consider benefits as an important element during their job search. With the pro-employee job market making it increasingly difficult for organizations to attract and retain top quality candidates, employers will become inventive with their benefit packages to offer non-traditional perks that one can not get anywhere else. Benefits such as home office stipends, extended parental leave, and fertility treatments will not be unusual to see being offered.

Additionally since we are seeing the adoption of pay transparency, job seekers will begin to lean on negotiating benefits as a tactic to increase their overall compensation.

Organizations will emphasize hybrid work environments

It’s no secret that a large percentage of Americans are enjoying the benefits of remote work. Remote work allows for flexibility and working autonomously in ways that are not present within a traditional office environment. For instance, employees can shift their working hours to tend to personal matters in the middle of the day such as caring for children or attending appointments. Many workers also feel like they have been able to build a sense of trust among their colleagues and bosses through working remotely as well.

With that being said, there is still a lot of value to the in-person connection that is established through working on-site. Collaboration opportunities increase, as well as team building through getting to know your colleagues on personal and professional levels.

This is why we can see hybrid work environments becoming increasingly popular within the upcoming year — to create a happy medium through combining the benefits of working both remote and in-person. With hybrid working styles, employees will be able to still enjoy the flexibility that they enjoy while not losing the connection that is brought by in-person face time.

Organizations that listen to the desires of their employees and take their point of view into consideration when making decisions such as return-to-work mandates will win brownie points with their teams, and overall increase employee satisfaction. In fact, many job seekers have stated that return to office mandates are a deal breaker for a role. We have started to see backlash to some tech companies such as Snapchat and Doordash bringing these mandates into effect, which will be something to pay attention to in the year ahead. 

Read more: The 6 biggest workplace trends in 2023 & beyond

The ever changing socio-economic landscape will continue to alter the employment landscape as we know it. Understanding these new developments will be key for employers, employees and job-seekers alike to adapt to these changes and succeed in the year ahead.

Robert Boersma, Vice President, Operations – North America at Talent.com