We witnessed the Great Resignation and now we’re hearing about the Great Regret. These two concepts are joined together. When you compare the data, it's an interesting dynamic, so let’s take a look. In the U.K., between the Great Resignation and the 500,000 people we lost due to long-term health issues off the back of the pandemic, we are still 600,000 people short in the remaining workforce. That’s 1.1 million out of a workforce of 20 million that were in the workforce and are not any longer. That's a pretty significant number.
What happened to those who left their roles during the Great Resignation? Are they facing the Great Regret today? What are these 600,000 doing out there? In all likelihood, they're enjoying life, they’re doing what they want to do, or they’re working where they want. We are in a weird position in Europe and the U.S. where, for the first time, the unemployment numbers are lower than the vacancies available in the workforce. Then there are the so-called Great Layoffs that we’re seeing in the U.S. in the technology industry.
To better understand this, you've got to look at the economics and the dynamics of the pandemic. During the pandemic, hyperscalers and content providers massively up scaled. Microsoft Teams went from 13 million daily active users to 145 million daily active users in 2021. That’s massive. For Microsoft to scale in this way to provide these new services and capabilities, they had to hire rapidly.
Now look at Netflix. They’re seeing a drop-off because of the cost-of-living crisis, and they've hit a plateau in the number of subscribers. They can't keep growing at the rate they're going. Digital services are having to innovate. The period of pandemic digitization is coming to an end.
We’re coming back to pre-pandemic levels of staffing, and layoffs play a part in that stabilization. However, if we look at the technology industry, it doesn't feel like those hiring levels have come down. Hiring is still ongoing; digital transformation still exists. Old jobs went away to some extent during the pandemic, whether it's via furlough or whatever else. But the industry is now hiring.
The U.K. Office for National Statistics (ONS) data show not quite a return to normal, but that we’re 80-85% there. That's where there is a delta of about 1.1 million jobs in the market for the U.K., where sickness, long-term sickness and those considering their position rather than returning immediately to work are forming a 10-15% gap. According to ONS data, employment rates are almost back to normal, whether you’re looking at activity rates or the redundancy rate, which has massively dropped, or the hours worked, which is nearly back to pre-pandemic levels as well.
That doesn't mean that people are working more than they did or less than they did. They’re working differently than they did.
What do I mean by working differently? We produced an e-book during the pandemic’s peak, and what we showed was that work has suddenly become a bit more amorphous. Rather than the old way of working where you travel to work, you work, you travel home, you have family time and then you sleep, now people are doing things as they want during the day. They might walk the dog, have a longer lunch, do a bit of non-work activity and work later. It's open to debate, to discussion, to flexibility. And this is the future of work. No longer is it black and white or slightly gray around the edges. It's now all shades of color, because people are working when they want, where they want and employers have to be aware of that. The pandemic was in some ways Pandora’s box for the future of work – once employees experienced that, they don’t want to let it go.
If we ask: why do people leave their jobs? People leave their jobs because of the workload, remuneration and the ability to work where you want to work, according to the World Economic Forum data. We have 27 countries that all have reported a one point something factor in terms of available jobs, which means there are more jobs than there are unemployed people. That's a really strange place to be – by the numbers, we should all be employed. The reason we’re not – again, it goes back to the future of work. Employees have expanded the way they think about work, and they are not willing to relinquish those ideas.
World Economic Forum also did a study in six major countries: Australia, Canada, India, Singapore, U.K. and U.S. All six countries had the same results: approximately 40% of employees are considering leaving their job in the next two years. So, as we see, organizations are vying for scarce resources: skills and skilled employees. This means that companies are having to concede to some of the new ways of working.
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