5 trends that'll shape the future of work
The future is always uncertain. However some trends can help us chart a trajectory for workplaces of the future. There are five trends that catch my attention.
- Most knowledge workers want flexibility at work and the number of people who want to work remotely all the time is increasing. Some countries like the Netherlands may even grant remote work as a right for employees.
- Even in a slowdown there are plenty of jobs for skilled knowledge workers. People with in-demand skills can get the work conditions they demand and this will only get better with time.
- As people have more disposable income, they'd like to improve their lifestyles. Traveling while working, i.e digital nomadism is no longer a fringe trend. Several countries already support such mobility.
- The 40-hour work week is a relic of the past and is meaningless for knowledge work. The four-day work week movement is gaining steam in some parts of the world with several successful experiments to back it up.
- Gen Z will soon be a large part of the workforce. Their values and expectations are already influencing corporations and will undoubtedly also shape the future of work.
Since this site forms the basis of my book project, you’ll find some topics around which I haven’t yet fully formed my opinions. The future is uncertain. So, it helps to keep an adaptive mindset so we can respond to this uncertainty. The last chapter of my proposed book will look ahead at the future of work and present some recommendations to its readers. Indeed, that chapter will build on whatever you read in this article. However, I expect to adapt my views to the state of the world of work when I write the chapter, and to the trajectory I forecast from that point on.
At the time of writing this article, the world of work is at an interesting juncture. Tech start-ups have receded into a funding winter. The euphoria around crypto is dying down. While the labour market is very tight in the west, and unemployment numbers are down in India, youth unemployment is up in China. The global semiconductor shortage and the war in Ukraine aren’t helping either. Talks of a recession are abound, and pretty much every tech stock has taken a beating.
This is also a time where we’re seeing the relationship between employers and employees reshape itself. As I noted with the great hybrid kerfuffle, we see a tussle between the old world and the new. Some bosses want to see employees back in the office. Employees, on the other hand, are standing their ground in a game of who blinks first. Commentators like Malcolm Gladwell have come out in open criticism of remote work, and have received tremendous backlash for what people see as hypocrisy.
My colleagues know of my enthusiasm for remote work. This website is unambiguous evidence of my biases. Not surprisingly, many people have asked me if all this is just a fad that’ll just disappear the moment we hit a recession. The fear, as someone articulated to me, is that when the supply-demand equation reverses, i.e., there’s a higher supply of talent than there’s demand for it; remote work will be the casualty.
Of course, that question is problematic on many levels. For one, it assumes that an employee’s desire to work remotely is somehow at odds with an employer’s goals. It suggests that employees seem to be winning the battle right now because the equation is in their favour, and that the moment the odds reverse, employers will strong arm their people back into an office. In some cases, this could be true. If an employer has invested large sums of money into buying office space, they want to make the most of it. While you could argue that this isn’t a great long-term strategy, it’s reflective of some employer behaviours we’ve noticed in recent months. That said, I’d like to believe that all employers aren’t really waiting for the first opportunity to nail their employees. I’m certain there are several employers who’ve taken a remote-first stance regardless of the looming recession. They do so not just because they care about their people, but also because they think it makes for a good business decision.
With all this in context, some of us may feel a sense of uncertainty and trepidation about the future. I know one thing from my research. For most people, where they prefer to work from; be it home, office or a third place; is an expression of their need for autonomy. No one; yes, no one; wants to lose that autonomy. That’s why it helps to know where the world is heading, so you and I can prepare for the future of work. I believe there are five key trends that are shaping this future, and, in this post, I want to share my thoughts about them.
Flexibility as a desire and a right
It’s safe to say that remote work has gone from being a privilege, to something that employees expect and value. In my own experience, many executives wouldn’t entertain any conversations about remote work before 2020. And then of course, things changed. Since 2021 I’ve run three separate surveys with large groups of technologists. In each survey a larger percentage of people have reported their desire to work remotely all the time.
People’s desire to work remotely is increasing rapidly
In Jun 2021 only 15.47% people wanted to work remotely all the time. In April this year, that percentage had doubled. This month that percentage has trebled. This is fascinating to watch even as a dispassionate observer. It seems that as people get more comfortable with remote work, they want it even more. At this rate, by mid-2024, about 90% of knowledge workers may want to work remotely all the time. It feels unlikely to me, but the fact that it’s a possibility seems like huge progress from just three years back.
It’s natural then, that many employees would even take a pay cut to work remotely. It may seem miraculous, but people are choosing balance in their lives. Work needs to be meaningful, but it’s not the only source of meaning in people’s lives.
“A significant number of employees benefit from the flexibility to define not only where but also when they work. Seizing the opportunity to embrace their kids is NOT an obstacle to doing great work.” - Gustavo Razetti
While employees want to work remotely and flexibly, there are competing regulations and legislations at play. For example the Netherlands seem poised to pass a law that makes remote work a right. On the other end of the spectrum, India, in a bid to keep their special economic zones (SEZs) relevant, passed a law that limits remote work to only 50% of a company’s registered employees. This means companies may either force some of their employees back into office on a permanent or rotating basis, or they may give up their SEZ offices altogether. The tussle between people’s demands, how regulation shapes up, and how employers respond will be interesting to watch. The question is - what bargaining chips do employees hold?
A skills economy
Raj Choudhury of Harvard Business School believes that top talent shapes trends at work. For example, back in the day only managers got laptops. Top talent asked for laptops as well and today a work laptop is the norm. Remember the Blackberry? That magical device from which only managers sent and received email? Top talent asked for access to email on mobile devices, and they got that too. Professor Choudhury believes that top talent will ask for the flexibility to work from anywhere and get it. That in turn will precipitate an industry wide trend. Even respected companies like Apple are losing their top talent because of inflexible policies.
If you have the skills, remote jobs are for the taking
On the other hand, for people who’re qualified, there isn’t a dearth of opportunities. Today there are dozens of job boards that target people who want to work remotely - We Work Remotely, Remote OK, Flex Jobs, Remote Scout, even LinkedIn. Companies like A.Team run their projects on the idea of a builder economy - where people with skills team up to solve complex problems and they get paid well for it.
“The pandemic eroded many tightly held assumptions. That we need to work in an office every day. That building great companies and products means accepting the tediousness of a traditional 9-5. That you can make good money or make a real positive impact on the world—but not both.” - Raphael Ouzan, A.Team
At the heart of this shift is a demand for skills that are in short supply, particularly in the world of tech. Recruiters, who’re looking for top talent will soon have to benchmark themselves against global competitors. You can’t just be content being the best in your neighbourhood. In an increasingly flatter world, people with the most sought-after skills will have the most bargaining power when it comes to work conditions. The more the industry woos them, the more they’ll have to listen to everyone else as well. In a skills economy, a flexible workplace is inevitable. And with flexibility come lifestyle changes.
Digital nomadism
Before I explain this trend, I need to explain three Indianisms to you.
SINK - an earning individual (single income) with no kids.
DINK - a working couple (double income) with no kids.
Uncle - a middle-aged or old man who isn’t up to speed with the latest trends.
And yes, I was a bit of an Indian “uncle” when it came to recognising digital nomadism. My ignorance is particularly obvious when you consider the fact that even the venerable Indian newspaper, The Hindu, reported on this phenomenon seven years back. This is how Forbes defines the whole thing.
“Thanks to the pandemic, more people are choosing to embrace a location-independent, technology-enabled lifestyle that allows them to travel and work remotely. They are called digital nomads, and the trend is becoming more widespread.”
I’m still going to sit on the fence with this trend, because I’m not yet sure how “widespread” it is. While I know of many digital nomad families, the trend currently seems limited mostly to the people we call SINKs and DINKs. What we do know is that it isn’t just the Silicon Valley techie that earns $300,000 a year.
The reason that I think this trend is worth keeping in mind is because of how rapidly immigration policies are changing to accommodate this idea. At the time of writing this post, 44 countries have digital nomad visas of some kind. Companies have had to scramble to put together policies for international remote work, so they don’t violate tax regulations in any country. At the same time, this reflects a desire on the part of many knowledge workers, to live their lives flexibly. After all, if all they need is a laptop and an internet connection, why should any location matter? All that matters is the employee’s skill and the results they produce.
The four-day work week
Speaking of results, you can’t ignore the four-day work week. The idea isn’t novel. Basecamp, one of the OGs of remote work, has a benefit called “summer hours” where employees work 32 hours, or four days a week from May to the end of August. They’ve always said that 40 hours is plenty, and 32 hours is enough. Rheingans, the German digital consultancy, has followed a five hour workday since 2017. That’s just 25 hours a week and they’re doing fine!
There's a good reason for that. Most of us can’t do more than four hours of deep work each day. Even that takes heaps of practice. Add a bunch of hours to that, to communicating about work, attending training or teaching others, maybe some gossip and what not, and you still have enough time in hand to have a productive 32 hour, four-day work week.
This isn’t some niche experiment. At the time of writing this post, the UK is conducting the world’s largest four-day work week trial - 3,300 employees across 70 companies. The program is already seeing positive results. The testimonials are coming in not just from the regular employees, but also from the leadership.
"With my day off I've been going on quite long bike rides, looking after myself, taking some time out and then having the whole weekend to get things done around the house and to spend time with family. The five-day working week is a 20th century concept, which is no longer fit for the 21st century."
Similar trials are underway in New Zealand, Ireland, US and Canada. The UAE has already transitioned into a four and a half day work week. 4-Day Week Global, the non-profit foundation behind many of the trials has already proven the efficacy of its model with its experiments at the Perpetual Guardian - a trust company in New Zealand. The model was so successful that it improved productivity by 20% during the trial period and now Perpetual Guardian has made the change permanent.
The 40-hour work week is an 80-year-old concept which was already a few decades late when it arrived. You see, in the industrial era, if an employee worked at a factory longer, they inevitably produced more output. Studies from 1890 showed that employees were working 100-hour work weeks! And this was several years after the famous May Day strike of 1867. In the US it took several years of labour struggle to finally make the 40-hour work week into law. Congress passed the Fair Labour Standards Act in 1938. It was initially for a 44-hour work week and then a couple of years later, they shortened it to 40 hours each week. Many other countries adopted this pattern around the same time; give or take a few years.
Knowledge work is different from industrial work. Eight hours at work don’t always mean 2x the amount of output as compared to four hours at work. The four-day work week recognises that reality. I hope the struggle for the four-day week isn’t as long and protracted as the struggle for the 40-hour work week. We owe a more sensible workplace to the next generation of knowledge workers.
Gen Z and their sensibilities
That next generation are the latest entrants to the workplace. Call them zoomers or Gen Z, they started entering the workplace in 2017 or thereabouts. I find this age group fascinating for more than one reason. This is a time when most of the developed world is ageing. More people will leave the workforce than those that’ll enter it. The United States is a prime example of this. So, we should expect an acute talent shortage in tech during the next decade or so. While we’ll need young workers to enter the industry in large numbers, the developed world simply won’t have enough of them. Younger, developing countries will become hotspots for talent if they aren’t already.
That's why zoomers are an important demographic to watch out for. This group is anything but homogenous. Gen Z in the west is quite different from Gen Z in the global south. And even in the global south, a first-generation college graduate from a small Indian town will be vastly different from a zoomer from a more privileged background.
My own data says that there’s little difference between zoomers and the general population of technologists when it comes to remote work preferences. For example, 46% of zoomers want to be exclusively remote as compared to 45% for the general population. That’s nothing.
That said, people with less than two years in the industry express that their biggest struggle with remote work, is their need to be around other people. I get that. These are youngsters who’ve been around people for most of their lives as students. It can be disorienting to then switch to a remote-first workplace. They need to figure out how to build their professional network, how to manage their own growth and learning and how to receive mentorship. Of course, there are tools and means to do all of this, but it's unfamiliar territory.
And lastly there are the values this group will hold dear. This varies by subgroup as well. In the west, Gen Z are very involved in social causes. 68% of Indian Gen Z have persuaded their employers to act on climate change and 95% seek to reduce their own impact on the environment (source: Deloitte). What impact does this have on a pointless commute to the office? Or on the heavy carbon footprint of all-glass office buildings? As this demographic finds more representation in the workplace, their values and sensibilities will no doubt influence their employer’s policies. We should all watch this space closely!
As you’ll notice, I’m not trying to make too many predictions here. The concept of universal remote work would have seemed nonsensical to some people as recently as 2019. Yet here we are. Things can change very rapidly with one precipitating event.
Who knows what happens when the semiconductor shortage is behind us, when the war in Ukraine is over, and when tech is booming again?
What if there’s another wave of the pandemic?
What happens if the four-day work week trials end as grand successes?
As legislations and regulations and regulations change, what impact will we see on the world of work?
You can probably tell that I’m curious to see how this space unfolds over time. How about you?