Employers have regained power over their employees, and the effects are already being felt.
During the peak of the “Great Resignation” in November 2021, 4.5 million workers voluntarily resigned. As of last month, the number was about 3 million, as workers hesitate to quit at a time when job searches can drag on for months. A report from the Federal Reserve Bank of New York shows workers are less optimistic about finding jobs today than they were during the 2020 pandemic.
Data from the Federal Reserve Bank of New York found that workers are even less optimistic about finding a job today than they were in 2020. According to the Federal Reserve, the average worker says they have less than a 50% chance of finding a job in today’s economy.
As artificial intelligence advances and investors pressure companies to cut costs, even those with jobs now have to deal with cuts to benefits and perks, and even mass layoffs. Many companies are also forcing employees to return to the office after years of flexible and remote working policies.
MyPerfectResume’s January survey showed that workers who might not have tolerated such layoffs in the past are now coping with the situation.
A survey of 1,000 adults found that only 7% of employees would quit their jobs due to mandatory return-to-office policies. By comparison, 51% said they would resign over the same issue in January 2025. The survey found that more than 70% of workers also predict that their bargaining power to push for flexible working policies will be the same or lower in 2026 than in 2025.
“The days of employee influence are over,” Jasmine Escalera, career expert at MyPerfectResume, said in a statement.
One of the most obvious reminders of changes in the workplace is the change in how companies work remotely. A July report from commercial real estate firm JLL found that Fortune 100 companies are forcing employees to work in the office an average of 3.8 days a week, up from 2.6 days in 2023.
Some employers have even gone further, forcing employees to come to work full-time and scrapping pandemic-era flexible work policies.
Instagram is one of them, with CEO Adam Mosseri telling U.S. employees in a company-wide memo in December that they would need to be in the office five days a week. Starting in 2023, parent company Meta requires employees to come to work three days a week.
Starting last month, automaker Stellantis began requiring employees to come to work five days a week. Meanwhile, Home Depot announced in January that employees would return to the office for five days starting earlier this month, along with 800 layoffs.
Even Microsoft, which instituted a flexible work policy in the wake of the pandemic that allows most employees to work remotely less than 50% of the time per week without manager approval, began requiring Puget Sound-area employees to come into the office three days a week starting in February.
In today’s economic climate, the reduction measures implemented by companies also extend to benefits and allowances. In February, Home Depot imposed stricter requirements on employee bonuses. Managers must now hit at least 95% of a store’s sales target to qualify for the bonus, up from 90% previously. At the same time, retailers have slashed the amount they pay to those who only meet the minimum threshold. Managers whose stores hit 95% or more of their sales targets will receive 25% of their target bonuses, down from 50% previously. The changes came as the home improvement retailer’s sales of $38.2 billion were down $1.5 billion year over year and below analysts’ expectations.
Meta CEO Mark Zuckerberg has been one of the loudest voices calling for cost cutting and efficiency gains, and Meta has reportedly cut some employee benefits in recent years. Some of the changes include eliminating free laundry and dry cleaning, and delaying the hours when dinner is served in the office so employees have to stay late to take advantage of it. Goldman Sachs cuts free breakfast and lunch options wall street journal.
With the unemployment rate reaching 4.3% in March, companies are cutting subsidies and benefits and trying to make employees more productive. Likely due to rising unemployment and low employment rates, the overall resignation rate has remained below 2% for eight consecutive months.
According to the U.S. Bureau of Labor Statistics, 178,000 new jobs were added in March, exceeding analysts’ expectations, but just a month ago, the U.S. economy lost 92,000 jobs.
Stanford University economist Nicholas Bloom, whose research helped define the Great Resignation, tells us wealth Workers should not leave their current job without having another job available in the last month. “You don’t want to quit a job only to find out that what you thought was easy — finding another job — turns out to be a huge struggle,” he said.
The adoption of artificial intelligence adds another layer of pressure. According to Goldman Sachs, while AI can save workers up to an hour a day, companies will soon demand more output from each employee, filling the time saved with additional tasks.
Jamie Shapiro, organizational psychologist and CEO of executive coaching firm Connected EC wealth While employers strive to increase productivity, they may also underestimate the long-term costs to employees and the company as a whole.
She said this was especially true if cuts to benefits or allowances were not spread evenly, in which case employers would need to ensure the reasons for the changes were clearly communicated.
“Whenever our justice is compromised, we see employees become less motivated because we want things to feel fair.”
She thinks it’s a mistake to think that squeezing workers harder will produce more output.
“When we don’t invest in our employees and don’t care about their well-being, we actually get a lot less from them.”
Big resignations show that employees won’t hesitate to move on when offered better offers elsewhere. That’s a problem for companies, especially when the average cost of turnover per employee is about six to nine months of an employee’s salary, according to a study by the Society for Human Resource Management.
Employees who constantly worry about the next layoff or benefit cut won’t be loyal to their employer and won’t brag about their company to their friends, which helps recruiting and company branding.
Improving employees’ perceptions of the company and the efforts they contribute to the organization goes hand-in-hand with a company’s workplace culture, Shapiro said.
“When I’m on the front lines, do I feel like my organization is treating me fairly? If the answer is no, then that can hurt motivation, not only the culture, but my level of commitment to the organization,” she said.
This story originally appeared on Fortune.com
