Key findings

In a crisis of talent, the organizations that will thrive are the ones that can build up workforce resilience.

#1 Talent feels unloved, overworked, and overlooked

Our two surveys reveal a disconnect between talent and their organizations. Many employees are ready to quit: 28% say they are very likely to leave their employer in the next 12 months. This fragility is happening at every level of the organization: last year’s research found that 72% of executives were planning to leave their current employer within the next two years.

The top reasons? Poor work-life balance and a lack of development opportunities: less than half of talent believe they have a manageable workload or satisfactory work-life balance.

And while they identify development and progression opportunities as the top reasons for staying with an organization long-term, only 23% say their employer provides regular training and development.

There is a worrying level of disengagement: 45% of talent say they are currently, or have been, delivering only the bare minimum of what their role contractually requires. That is a significant loss of discretionary effort for organizations—and reflects a failure to inspire and engage.

#2 Businesses’ focus on talent could be fading

Organizations may be experiencing ‘fatigue’ in their strategies to engage employees, and particularly in their efforts to create more inclusive workplaces. For example, senior leaders are almost a third less likely to be holding open conversations about diversity and inclusion than they were 12 months ago (21% compared with 30% in 2022).

But their job is not done on fostering inclusivity. Alarmingly, 43% of talent have experienced non-inclusive behaviors in their current organization; 37% say they work in a psychologically unsafe environment.

Recent commitments to workload and wellbeing also appear to be slipping. A quarter of executives report that their organization’s ability to support employee wellbeing and morale has declined over the past year (25%). A similar number say that employee wellbeing (24%) and satisfaction (23%) have decreased over the same period—numbers that have more than doubled since 2022 (11% each).

#3 Workforce resilience is weakening and potential is neglected

Organizations are starting to feel the impact of failing to meet their talent’s needs. Almost half of executives (46%) say that difficulty sourcing talent is leading to missed business opportunities. A similar number (42%) admit that they are failing to unlock the full potential of their workforce, and 26% say they lack a clear view of talent and skills they need over the next two years.

Less than half of executive respondents (47%) believe their workforce is resilient—that they have the talent they need in order to achieve their business objectives over the long term and adapt to market changes. About half of executives link these weaknesses to reduced customer satisfaction.

#4 The Workforce Resilience Leaders show the way forward

Our research reveals that the Workforce Resilience Leaders—the organizations focusing on the three critical pillars—are far more likely to report stronger business performance than their peers:

69% say that employee productivity has improved over the past year, compared with 51% of executives overall
61% report increased profitability, compared with 53% of firms overall
58% report increased customer satisfaction, compared with 51% overall

The Workforce Resilience Leaders represent 12% of firms in the survey sample. In this report, we compare what the surveys tell us about the Workforce Resilience Leaders with what they tell us about the firms that report poor performance across the three pillars. We call this latter group the Workforce Resilience Laggards, and they represent 6% of the sample.

The strategies adopted by the Workforce Resilience Leaders show how other firms can navigate the challenges of today’s labor market to strengthen their connections with employees and increase their workforce resilience.

The three pillars of workforce resilience

Workforce agility: the ability to scale and align the workforce in response to business change, for example by rapidly recruiting specific skills and reassigning employees to where they are most needed.

Diversity, equity, and inclusion: building a culture where all employees are respected, valued, and able to reach their full potential, regardless of factors such as race, gender, sexual orientation, age, disability, and neurodiversity.

Workforce capability: having the right mix of talent, supported by the right training and technologies, to achieve the organization's current and future strategic goals.

The Workforce Resilience Leaders are defined by strong performance across all three areas, and the evidence suggests that both sides of the employment relationship benefit as a result. Talent is happier and more productive, and they plan to stay with their employer for longer; executives are more likely to say that employee productivity, customer satisfaction, revenues, and profit have increased over the past 12 months.

Key findings

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Organizations are failing to meet the needs of talent

The pandemic catapulted talent to the top of the business agenda. Wellbeing and health were first-order priorities. Engagement took on new meaning as many workers switched to remote and hybrid working. And diversity and inclusion became the focus of countless discussions as societies worldwide grappled with difficult questions about equity.

But have organizations sustained that momentum as they emerge from the pandemic, and is it leading to increased workforce resilience?

Executives know they face challenges

Our survey of executives shows that many recognize the importance of building workforce resilience: 46% say it is a priority. But many know that their organizations are not doing enough to build and retain quality employees: 42% admit that they are failing to unlock the full potential of their workforce, and 46% say that difficulty sourcing talent is leading to missed business opportunities.

Figure 1: Less than half of executives believe their workforce is highly resilient

The Great Resignation may not be over

Anthony Klotz, the business school professor who coined the term ‘the Great Resignation,’ is among those forecasting that employee resignations will level off in 2023.¹ But our talent survey shows that many employees remain unsettled: 28% say they are very likely to leave their job in the next 12 months.

Figure 2: Almost a third of the talent we surveyed are planning to leave their employer in the next 12 months

Why are they so unsettled, and what can organizations do about it? Our talent survey shows that the top reasons to quit are poor work-life balance and a lack of opportunities for career progression and skills development. Reasons for staying are the inverse: good opportunities, followed by work-life balance.

Figure 3: Work-life balance and development opportunities have the greatest impact on retention

¹ https://www.cnbc.com/2023/02/01/professor-who-coined-great-resignation-anthony-klotz-says-quits-will-plateau-in-2023.html

Figure 4: Work-life balance and development opportunities have the greatest impact on retention

In our executive survey, however, they say pay and benefits is the top reason why talent is quitting. Why the disconnect? It could be that executives are reflecting on past drivers of discontentment, while talent is looking forward. And perhaps talent recognizes the improvements in pay and benefits offered by many organizations in the past two years.

Figure 5: Executives’ views on the factors driving retention differ to those of talent

The message to employers is clear: for talent, work-life balance and opportunities for growth are non-negotiable.

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The three pillars of workforce resilience

Building a resilient workforce that is capable of seizing new opportunities at speed is a multidimensional task. It requires a strategic view of the skills the organization needs now and those they are likely to need in the future, paired with a deep commitment to engaging and developing talent at all levels of the enterprise.

Recognizing this, in our executive survey we investigated how organizations are performing in three important ways:

Workforce agility
The ability to scale and align the workforce in response to shifting business objectives
Diversity, equity, and inclusion (DEI)
Building a diverse culture where all employees are respected, valued, and able to reach their full potential
Workforce capability
Having the right mix of talent, equipped with the right digital and automation strategies, to achieve the organization's current and future strategic goals

Figure 6: Almost a quarter of executives rate their organization as poor when it comes to the three pillars of workforce resilience

Weakness in these three areas can harm business outcomes. According to executives, the most common impact is on customer satisfaction.

Figure 7: Customer satisfaction is at risk from poor workforce resilience