With labor market weak, employees are "job hugging"
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Illustration: Sarah Grillo/Axios
Forget job hopping, employees are now "job hugging," holding on tight to their current employer.
Why it matters: The labor market is grim at the moment. Hiring has stalled. And with fewer options, workers are planning to stick with their current employers, regardless of job satisfaction.
- Such "torpor" can mean fewer opportunities for up-and-comers inside organizations, notes a piece from Korn Ferry, which names the trend.
- "A sense of global events as unpredictable and unprecedented, combined with looming AI disruption, is making workers increasingly unsure—which can lead them to stay in holding patterns, rather than developing their skills and careers," Matt Bohn, a senior client partner at the consulting firm, says in the piece.
Where it stands: The job market is in bad shape. The past three months saw the weakest job creation in the U.S., outside of the pandemic, since 2010 in the wake of the global financial crisis.
Stunning stat: Just 965 private-sector jobs were created in New York City in the first half of the year, the slowest job growth outside a recession in decades, The New York Times reports.
Zoom in: The white-collar employment picture is particularly bleak. Employment in professional and business services has steadily declined this year, after surging in the post-pandemic era.
- Employees are reporting high levels of job anxiety. There's also increasing fear that AI will come for their jobs.
"In another environment, I would absolutely be looking to switch jobs or industries, but there's nowhere for me to go," a consultant who works in D.C. tells Axios, asked for anonymity for fear (what else?) of losing their job.
- Their firm is in an industry — consulting — that's contracting this year, and it does business with the federal government, which has fired thousands of people and cut contracts.
- The job market in D.C., in particular, is flooded with newly fired federal workers all competing for the few jobs out there, they said.
Between the lines: For employers, this is a good moment to take their power back — after years of a hot labor market.
- Companies no longer have to bend over backward to hang on to workers, with benefits, promotions or raises.
- Instead, they can push for workers to return to office and put in longer hours. In a widely shared letter, the CEO of AT&T even tells employees not to expect loyalty from the company.
"He's trying to scare employees into working hard," writes Aki Ito in Business Insider, which first surfaced the memo. It's a posture more leaders are adopting.
The intrigue: Fear isn't considered a good motivator.
- Job huggers aren't exactly putting in their best work. "I am less efficient," says the consultant in D.C. It takes more time to get the work done because they feel paranoid about job loss and distracted by those worries, they said.
Reality check: The good news is that the unemployment rate is still relatively low, and, outside the federal government, so are layoffs.
The bottom line: Hugs are usually comforting, but these squeezes are all about anxiety.
