If 2020 was the year of change, then 2021 was the year of adaptation. Last year threw disruption at us from every angle, and this year was all about adjusting to those new market conditions, customer behaviours, regulations, disruptive technologies and expectations. The disruption continued, but we were better placed to cope with it. At times, it felt like taking two steps forward and one step backwards, making progress but slowly. Gradually, we managed to rebuild and recover rather than focusing our energy on fighting fire after fire as it became apparent that the world would not revert back to how it was pre COVID-19.
As 2021 draws to a close, it’s become apparent over these final weeks of the year that our need for adaptation and learning hasn’t ended. We need to continue on the journey to ensure we’re not set back. So, before we all switch off to recharge over the festive period, let’s take a moment to reflect on the lessons of 2021 so that we may come back even stronger in 2022!
In December 2020, we published our annual predictions for the new year. At this point in time, the UK had not yet locked down for a third time, the Government had not introduced its roadmap out of lockdown, and only the eldest and most vulnerable of us had received the vaccine. Our predictions were born out of uncertainty and caution, but with the optimism that we would finally begin to move forward.
There is a lot that our and other commentators end-of-year predictions got right, but none of us could have predicted that it would all play out exactly the way that it did. For example, we predicted that the customer journey would become increasingly digital and experiential, but we could not have guessed that the global supply chain to provide them with products would become so unstable. Based on the public stances that many of the world’s biggest companies took in regard to their business models last year and with the third UK lockdown looming overhead as we made our 2021 predictions, we knew remote work would continue in some form but could not have forecasted that it would contribute to one of the biggest employment shifts in our lifetime. And though many statistics and surveys of the UK’s professionals indicated a majority preference for flexibility, many businesses learned the hard way just how serious their employees were about continuing on this way.
The Great Resignation is arguably one of the biggest disruptions we saw this year, though it was not the employment shakeup any of us would have guessed would happen. At the start of this year, it seemed most possible that the end of the furlough scheme would rock the job market and lead to mass redundancy. Instead, we saw people willingly leave their roles in search of something ‘better,’ whether that be in terms of pay, flexibility, or culture. Staff and executives alike don’t want to be ‘managed’ or ‘told what is, ’ but instead want to play a role in co-creation and are willing to move on to an organisation that will allow them to do so. As a result, we are seeing record-breaking employment figures and an increasingly complex job market.
In the latest ONS Employment in the UK update, it was estimated that the unemployment rate is at 4.2%, which is 0.2 percentage points higher than before the pandemic but 0.4 points lower than the previous quarter. The employment rate grew as well, rising 0.2 percentage points from the previous quarter to 75.5%. A net increase of 304,000 people moved from unemployment into work in Q3, the biggest jump on modern records dating back to 2001. The data also shows that the number of vacancies in the market reached a record high in the three months to November, climbing to more than 1.2 million. The UK job market is rebounding as anticipated, with plenty of opportunity available.
But if things seem to be improving, what does that say about the Great Resignation? The latest ONS figures primarily reflect the months leading up to October and November, meaning we won’t know until early 2022 what happened in the final three months of 2021. If the impacts of the Great Resignation aren’t already being felt, they likely will be soon. In a poll from Randstad published in November, 24% of employees in the UK reported plans to move jobs within the next three to six months.
In the new year, this will all have major implications for both leaders and executives undergoing their own career transitions. For these executives, this may mean even fiercer competition in an already challenging executive job market. The desirable roles will be highly sought after by a pool of qualified candidates from around the world, making it more imperative than ever to differentiate oneself. For leaders, it means a reset in what ‘leadership’ really looks like.
The situation cannot change unless organisations and their leadership lead the charge. One thing is clear: If businesses have any hope of bouncing back strong in 2022, they need to shift focus from recovering profits to retaining their people. Here are our top predictions for the year to come:
The Great Recruitment Challenge: The Great Resignation has created market conditions that will be difficult for both executives and organisations to navigate. While the resignations mean that fresh talent is entering the market, the competition between employers to secure this talent will be fierce. On the other side of the coin, with so much qualified talent in the market, executives will have a harder time securing the desirable roles. It’s a bit of a double-edged sword for the executives undergoing career transitions. The Great Resignation is opening up more opportunities in the market, but there’s a reason for that. In the wake of this wave of resignations, it’s easy for an executive to be a bit wary about why a seemingly fantastic role has suddenly opened up. If an executive is undergoing a career transition in search of specific criteria, they may have a hard time finding that.
For employers, an ageing population, disrupted immigration post-Brexit, and the strong recovery in customer demand have put additional strains on the labour markets that will remain throughout 2022. The pandemic shifted our priorities in so many ways, and while many organisations were quick to adapt their practices to keep things ticking over, culture shifts have been much slower. Employers are going to have a difficult time drawing in the talent that they want if they are not willing or able to provide the types of things today’s executives are looking for, which will be a real detriment to businesses looking to recruit next year.
The Great Retention Challenge: The culture issues will also make it much harder to hold on to the organisation’s existing talent. In November, Rialto conducted a poll asking executives who were considering a career transition or who had recently resigned from their position what they were looking for most in their next role. The resounding majority (61%) reported wanting a better culture or leadership. Flexibility and salary took a back seat here in terms of priority, earning only 17% and 16% of the vote, respectively. This indicates that if organisations want to avoid having to battle a tight labour market, they need to fix the internal problems that may lead their existing talent to leave and may make it difficult to attract new talent.
Leaders need to spend the start of 2022 identifying where these issues may be in order to address them. We are already seeing a trend of many leaders conducting ‘stay interviews’ with staff to unearth the grievances that may lead them to leave. Expect to spend much of your energy in Q1 2022 on rebuilding internally rather than branching out externally.
The Upskilling Imperative: The record-breaking number of vacancies in the market and high unemployment rates tell us that the problems in the market aren’t due to the number of roles or candidates available in the marketplace. Rather, it’s a skills issue. The jobs available simply don’t match the people. That of course makes it more difficult for executives in transition to find the types of roles they want or are suited for. Differentiation is more imperative than ever for executives. Adding desirable, future-focused skills to your arsenal can help to set you apart from other similar candidates and provide you with an edge in an increasingly competitive global job market. Tech skills as well as more human-centric capabilities such as strategic thinking, communication, empathy, and creativity will all be increasingly valuable in 2022.
But just as much as executives want desirable roles, employers want the best possible talent on their team. If battling the recruitment landscape is not a feasible option, consider investing internally into programmes that will equip your current workforce with the types of capabilities that will further the organisation’s strategic objectives and provide value to the organisation in the future. Not only that, but it shows your staff that you are invested in their success and may help your retention efforts. Leaders should also invest in their own skills to enhance their own capabilities and ensure they have what it takes to lead the workforce of the future.
The Leadership Reset: For leaders, it will take more than upskilling to become future ready. In 2022, there needs to be an overhaul of what leadership means and looks like. The role of a leader is becoming increasingly challenging. In addition to the challenges of the labour force, leaders are tasked with tackling changing market conditions, catering to customer expectations, answering to stakeholders, and generating value for the organisation during one of the most transitional periods of business in history. Not only that, but every major decision today’s leaders make plays out in the social media arena. Juggling one’s individual and organisational reputation while making the right moves for the business is a fine line to walk.
A dramatically-changed business landscape calls for an overhaul in mindset. The idea of what it means to be a leader needs to change in order to accommodate the shifts in employee and consumer priorities, technological innovation, and ways of working. If you throwing all of your energy into firefighting or profit building and aren’t thinking holistically about how all of these different come together to impact the success of your business, then you will struggle in 2022 and beyond. The shift in leadership needs to begin with the leaders themselves. In the new year, take time to reassess your approach. Be honest and critical, and accept that what has traditionally worked may no longer suit.
Dealing with Disruption: At this point, ongoing disruption has become less of a spanner in the works and more of an inevitability of our professional lives. The challenge for leaders in 2022 will be to come to terms with that reality and progress from there. The surging threat from the Omicron variant demonstrates that this pandemic is far from over, and COVID is something we will have to continue living with. With that in mind, how do you as a leader intend to deal with it? Moreover, our reliance on technology is deepening, with Statista forecasting an estimated $1.5 trillion USD will have been spent globally on digital transformation by the time the year ends. This number is predicted to rise to $1.8 trillion USD by the end of 2022 and more than double to $2.8 trillion by 2025. Technology is quickly advancing and at this rate, it is outpacing the rate at which humans can adapt. Leaders need to ensure they have the right skills to adjust, and the right mindset to generate buy-in. Additionally, sustainability is becoming a global priority, and can no longer be pushed aside for later. In 2022, leaders need to take decisive action to tackle these critical business issues and embrace disruption rather than constantly battling against it.
If the past two years have taught us anything at all, it is to expect the unexpected. There is no telling what 2022 will bring, but if we take the time to reflect and learn from our shortcomings, we can only improve. While 2021 called us to adapt, 2022 will require us to embrace and evolve so that we can not only drive business forward but also better what our working lives look like.
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