Today Microsoft announced the findings from its first annual Work Trend Index. Titled “The Next Great Disruption is Hybrid Work – Are We Ready?” the report uncovers seven hybrid work trends every business leader needs to know as we enter this new era of work. The report outlines findings from a study of more than 30,000 people in 31 countries and analyses trillions of aggregate productivity and labor signals across Microsoft 365 and LinkedIn. It also includes perspectives from experts who have studied collaboration, social capital, and space design at work for decades.
Jared Spataro, Corporate Vice President for Microsoft 365, encapsulates the study’s results in one key warning: hybrid work should not be seen as business as usual. Leaders must adopt a growth mindset and be prepared to rethink how they hire and retain talent, foster collaboration and shape company culture.
The report uncovers seven hybrid work trends every business leader needs to know to be prepared and thrive. Here are the trends highlighted by the study and my thoughts.
Flexible work is here to stay
Seventy-three percent of workers surveyed want flexible remote work options to continue. Yet, with 67 percent of workers saying they are craving more in-person time with their teams, there might be a need to rethink what going to the office might look like. Interestingly, 66 percent of business decision-makers are considering redesigning physical spaces to accommodate hybrid work environments better. Yet, 42% of employees say they lack home office essentials, including 1 in 10 saying they do not have a good internet connection to get their job done. Even more disheartening is to read that only 46% of workers say their employer is helping with remote work expenses.
Prioritize tools, both hardware and software, to make sure remote workers do not face a financial burden or more cumbersome workflows, which will likely lead them to feel inferior to in-person employees. Hybrid work or flexible work will not be successful unless companies invest in tools, training and culture to ensure the democratization of remote work we saw during the lockdown remains.
Leaders are out of touch with employees and need a wake-up call
When it comes to how the pandemic has impacted leaders and employees, the data clearly points to a significant disconnect between the two groups. Sixty-one percent of leaders say they’re “thriving” right now — 23 percentage points higher than those without decision-making authority. They also reported stronger relationships with colleagues (+11 percentage points) and leadership (+19 percentage points) and a higher likelihood of taking all or more than their allotted vacation days (+12 percentage points). As expected, and sadly so, business leaders surveyed were also more likely to be Millennials or Gen X, male, information workers, and farther along in their careers. In contrast, Gen Z women, frontline workers, and those getting started in their careers reported struggling the most over the past twelve months. Possibly because they are remote or perhaps because managers live a different day-to-day reality from that of their team members, the study found that 31% of the global workforce says their companies are asking too much of them under the circumstances.
While the circumstances might have been unprecedented during the pandemic, leaders must learn to care for the whole human being, not just the employee. For years we have been trained to leave our personal life outside the office, but Covid-19 highlighted how unrealistic that expectation actually was. We might cover, even successfully so, but at a price both for us and the business.
High productivity is masking an exhausted workforce
Nearly one in five global survey respondents say their employer doesn’t care about their work-life balance. Fifty-four percent feel overworked. Thirty-nice percent feel exhausted. Looking at the growing number of meetings, chats and docs respondents were involved with explains the feeling but not the underlying reasons that drove them to engage in such away.
For remote work and hybrid work to be successful long term, we must get to the bottom of this digital intensity. I would argue that many workers felt the pressure of proving they were working and productively so in a world that lacked some of the typical parameters, such as when we arrive and leave the office. Such a need is born from insecurities that leaders will have to eradicate by rethinking how to measure and evaluate not just the output but the entire workflow.
Gen Z is at risk and will need to be re-energized
Sixty percent of Gen Zers — those between the ages of 18 and 25 — say they are merely surviving or flat-out struggling. They also reported more difficulty feeling engaged or excited about work, getting a word in during meetings, and bringing new ideas to the table when compared to other generations.
This should not really come as a surprise given this generation is just getting started in their career and might miss the networking connection to navigate their company, even more so in a remote environment. This is also the generation that typically benefits the most from office perks such as free or subsidized food and facilities such as the office gym. It might also be the one group businesses might have felt they could lean in more because they are often single and have no children. However, not having children does not mean a lack of family responsibility. Being alone might have also been particularly emotionally taxing for many who might not have wanted to voice their issues precisely because they are early in their careers.
Shrinking networks are endangering innovation
Anonymized collaboration trends between billions of Outlook emails and Microsoft Teams meetings reveal a clear trend: the shift to remote shrunk our networks. Chats followed the same path. The report highlights the importance of the network in relation to innovation and productivity. People who said they felt the most productive in the survey also reported strong workplace relationships and feelings of inclusion at work.
As critical innovation and productivity are, I would argue that a broad and robust network is the cornerstone of an even more crucial piece of the puzzle: company culture. Creating social opportunities for employees to widen their digital network will be vital during office time in a hybrid work environment.
Authenticity will spur productivity and wellbeing
Compared to one year ago, 39% of people in our study said they are more likely to be their full, authentic selves at work, and 31% are less likely to feel embarrassed or ashamed when their home life shows up at work.
This is not the case for all demographics, Black and US Latino workers in the U.S. reported more difficulties building relationships with their direct team (19% and 18%, respectively, compared to the 12% national average), feeling included (21% and 28%, compared to a 20% national average), and are less likely to bring their authentic selves to work than a year ago than the broader population (26% and 24%, compared to a 17% national average).
At the start of the pandemic, I argued that remote work would lead to a more diverse workforce, but this does not mean remote work is inclusive by default. Especially during the pandemic, we saw underrepresented groups struggling with sharing their feelings of life issues in fear of being deemed unprofessional. Leaders must be aware of how race, gender and other socio-economic circumstances make specific conversations particularly difficult for some employees.
Talent is everywhere in a hybrid work world
An analysis of the LinkedIn Economic Graph shows women, Gen Z, and those without a graduate degree as the groups most likely to apply for those jobs. In the U.S., the study found that Black, US Latino workers and women are more likely than white workers and men to say they prefer remote work.
The level of ethnic and racial diversity in America differs dramatically from state to state. This means that companies in less diverse places might need to recruit outside the area and expect new employees to relocate. For many workers from underrepresented groups, the daily office reality includes covering and micro-aggressions. The strain does not end with the workday. Newly relocated employees might also struggle to find a community culture that offers the food, or services, or places of worship they’ve grown up with.
I’m not suggesting that remote work is a panacea for the multifaceted diversity issues facing many organizations. Any company leader in any sector should condemn racism and intolerance and foster inclusion so that workers from underrepresented groups feel valued. Alongside that effort, remote work can help boost those diversity numbers a little faster. Leaders should purposefully use remote work to foster a more diverse workforce because remote work is good for diversity, and diversity is great for business.
If you are a business leader and have read thus far and are still left wondering why you should care, allow me to make it very clear for you. The study says that 41% of the global workforce is likely to consider leaving their current employer within the next year. This number is even higher for Gen Z (54%). At the same time, 46% are planning to make a significant pivot or career transition. Uncovering how the seven key trends highlighted by the report impact your business and how you can address them will make the difference between being among those organizations employees flee or being a workplace people cherish and wish to join.
Disclosure: The Heart of Tech is a research and consultancy firm that engages or has engaged in research, analysis, and advisory services with many technology companies, including those mentioned in this column. The author does not hold any equity positions with any company mentioned in this column.