The COVID-19 pandemic has brought extreme workplace disruption, seeing employees emerge from the crisis with changed perspectives on the role of work in their lives. However, our research has found that despite a refreshed outlook and clearer expectations, employees and managers across Australian organisations don’t believe they’ve yet experienced the most significant impacts of the pandemic on the workplace.
Now, we’re witnessing the next wave of change disrupting our workforces.
The Workplace Wave is the next wave of change whereby the disruption of the pandemic is causing permanent shifts in desired ways of working, employee engagement and, in turn, workplace mental health. In August 2022, we conducted research to explore the long-term, permanent impacts of the COVID-19 pandemic on workplaces. We also researched how both managers and employees can navigate this evolving change to create mentally healthy workplaces.
Our research comes as our claims data shows a 17% increase in the rate of psychological injury claims since pre-pandemic times, reflecting the increasing trend severity of mental health challenges in the workplace. Our claims data also shows that when psychological claims are lodged, up to 85% of those claims result in time off work, exacerbating one of employees’ key workplace concerns.
The research identified that as we enter the post-pandemic era, employees are feeling unsatisfied with the role of work in their lives, organisational resourcing, and the opportunities for upward mobility within their organisation. These feelings are contributing to the growing disconnect emerging between employees and managers, who are failing to understand the changed priorities and concerns of their employees. Adding to this challenge is the complexity of different generations being impacted by this disruption in different ways, placing pressure on organisations to listen closely to their employees and understand the concerns of their diverse employee base.
This report summarises the key insights and findings of the research conducted below.
While workplaces embrace a ‘new normal’ in ways of post-pandemic working, almost one third (30%) of Australian employees surveyed stated they’re unsatisfied with the proportion of time they spend working. At the same time, there’s apprehension around the disruption still to come from the long-term impacts of the pandemic, with 42% of employees and 57% of managers surveyed believing they’re yet to experience the most significant impacts of the pandemic on the workplace.
Our research indicates that employees are experiencing a sense of isolation, with more than 2 in 5 (46%) still feeling no change in levels of isolation or connectedness to their colleagues, as they did when lockdowns and other more extreme COVID-19 restrictions were in place, and a quarter (24%) saying they’re more isolated now than before the pandemic began. Managers surveyed are aware of this growing sense of isolation, with 42% believing their employees feel more isolated from their colleagues now compared to before the COVID-19 pandemic began.
Staff shortages due to absenteeism emerged as a key occurrence for employees, with almost half (48%) – the equivalent of 4.5 million employees (when survey data is extrapolated to the general population) – feeling that they often experience this. To add to this pressure, over a quarter (28%) of employees’ job satisfaction is negatively impacted by worries around physical health, i.e. concerns about becoming ill when working in the office and contracting COVID-19 or long COVID.
Worryingly, these emerging concerns and pressure points on employees are ultimately driving issues with talent retention, with more than 2 in 5 (42%) employees surveyed saying they’re likely to consider leaving their current organisation in the next 6-12 months. Many managers surveyed are not recognising this, with 39% saying that their employees or direct reports are not likely to consider leaving during this period.
Resourcing remains a prominent issue within Australian workplaces, which has a direct impact on the day-to-day experience of employees, and in turn, the overall productivity of organisations. Our research shows that 1 in 5 (20%) employees surveyed – the equivalent of almost 2 million employees (when survey data is extrapolated to the general population) – don’t agree that they can comfortably complete all their work within their scheduled hours, with a further 1 in 4 (27%) employees surveyed feeling obliged to respond to work queries outside of their contracted hours.
Following more than two years of remote, and now hybrid working, flexibility has become commonplace within modern workplaces. However, while 60% of employees surveyed said that they have a say in their flexible working conditions, only 24% feel completely comfortable discussing when and where they work and their working hours. Increasing concerns about what might occur within their workplace over the next 12 months are adding to employees’ levels of unsatisfaction. Employees surveyed said they were most concerned about contracting COVID-19 or long COVID in the workplace (29%), being unable to secure a promotion or pay rise (26%), and high staff turnover (25%).
These findings indicate that there has been a clear shift in employee priorities as they seek greater recognition and more empowerment over how and when they work.
The growing disconnect between employees and managers was explored in Allianz's research throughout the pandemic (PDF 1.8MB), and our latest research indicates that this disconnect is growing. Managers are finding it increasingly difficult to connect with their employees and to understand their needs and concerns, particularly when it comes to supporting mental health in the workplace.
Managers are twice as likely as employees to say that their organisation has gone above and beyond to provide support and systems to create a mentally healthy workplace (53% compared to 25%). In fact, only 4% of managers surveyed claimed they’re unsatisfied with their organisation’s efforts to create mentally healthy workplaces over the last 6 months. Just over half (56%) of employees surveyed said that their employer provides mental health services to all staff, with 23% of employees surveyed saying that staff don’t have access to mental health services.
There are also differing views around how engaged employees may or may not be feeling in the workplace. Our research reports that 3 in 5 (60%) managers surveyed said their employees or direct reports are very engaged at their organisation. However, only 42% of employees surveyed said they’re very engaged in their current role at their organisation.
When questioned about the factors that are negatively impacting their job satisfaction in their current role, fatigue and burnout (42%), staff shortages due to low talent acquisition (34%), and not being adequately rewarded for their work (31%) were most reported by employees surveyed. In contrast, managers surveyed felt that staff shortages due to low levels of talent acquisition (25%) and limited opportunities to connect with the team in person (25%) caused employee dissatisfaction. While 1 in 4 (26%) employees surveyed said that bullying and harassment occurs within their organisation, 3 in 4 (76%) managers surveyed said that bullying and harassment doesn’t occur within their organisation.
The growing disconnect between managers and employees in the workplace highlights the need for greater opportunities for feedback – both formally and informally – among these groups.
Workplaces are experiencing four different generations working together. While this brings opportunities for important diverse thinking, different generations – particularly Generation Z – are being impacted by The Workplace Wave in different ways. This creates an additional challenge for organisations looking to address their employees’ needs.
Our research shows that Generation Z employees surveyed are most unsatisfied by the proportion of the time they spend working (35%). This contrasts to Millennial employees surveyed, who are most satisfied by the proportion of the time they spend working (72%). Both Generation X and Baby Boomer employees surveyed are equally satisfied by the proportion of time they spend working (71%).
Half (50%) of Generation Z employees surveyed identified fatigue and burnout, including increased pressure on productivity and workload, or mental health issues as having the most negative impacts on their job satisfaction. This contrasts to the oldest generation, with Baby Boomers saying that staff shortages due to low talent acquisition (34%) have the greatest negative impact on their job satisfaction.
Generation Z employees are also the least likely generation surveyed to be very engaged in their current role at their organisation (28% compared to 46% for Millennials, 42% for Generation X, and 42% for Baby Boomers). When voicing concerns about what might occur in their workplace in the next 12 months, Generation Z employees surveyed said they’re most concerned about being unable to secure a promotion or a pay rise (33%). Employees surveyed from the older generations said they’re most concerned about contracting COVID-19 or long COVID in the workplace.
When asked how organisations should improve workplace mental health, each generation surveyed responded differently. Generation Z employees surveyed called for specialist mental health leave days in addition to sick leave (40%). Millennial employees surveyed called for empathic and emotionally intelligent environments to drive a better workplace culture and create better working relationships, e.g. mental health awareness training, private spaces to conduct discussions or mentorship or guidance (44%). Conversely, both Generation X and Baby Boomer employees surveyed called for adequate remuneration in line with the market/inflation (41%).
The differing views reported by the different generations surveyed suggest that organisations should consider the unique make up of each workplace and how this may be influencing their employees’ immediate needs and demands.
We should expect to see further examples of The Workplace Wave emerging in the months – even years – to come. Organisations and employees will continue to adapt to the fundamental shifts in their shared approach to work. At the same time, The Workplace Wave will also continue to impact different industries, individuals and environments in diverse ways.
For this reason, organisations should increase their proactivity in understanding their employees’ needs and demands. Factors such as important conversations between employees and managers, creating an environment that fosters open and honest dialogue in the workplace, and collecting formal feedback through workplace surveys will be particularly important over the coming months and years.
While a best practice response to The Workplace Wave is still evolving, employees feel that empathetic workplace environments that also prioritise reward and remuneration hold the key to improving mental health in the workplace. Our research showed that in order to improve mental health in the workplace, employees surveyed expect organisations to:
Managers surveyed generally agreed with the focus on empathetic and emotionally intelligent environments to drive a better workplace culture and create better working relationships (37%). However, they also placed significant importance on having regularly updated mental health training and policies (34%) and clear processes in place for annual leave accrual, holidays and sick leave (34%).
This places great importance on future skills planning, career pathways, learning and development, and having open conversations about how engaged employees feel in the workplace.
An increase in having meaningful connections with colleagues is most likely to have the greatest impact on improving employee engagement, with our research revealing that employee engagement can be improved through:
Meaningful connections mean different things to different people, and enhancing empathy and emotional intelligence through training and skills development can help employees recognise this. They can engage in open dialogue about what they need to build meaningful connections with colleagues. Many employees are seeing meaningful connections through purpose and values, thereby enhancing their personal connections to work.
It’s crucial that organisations don’t passively ride The Workplace Wave, but proactively and continually question the wellbeing of their workforce and their evolving needs.
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