Plus ça change: Traditional working isn’t dead yet

Plus ça change: Traditional working isn’t dead yet

Reports of the death of the traditional employment model have been greatly exaggerated. The idea that multiple generations in the workplace will lead to employers contracting out every project is profoundly flawed. The battle for talent and the need for engaged people mean that businesses will continue to employ full-time staff.

David Ellis

Partner

KPMG in the UK

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Plus ça change: Traditional working isn’t dead yet

It is true that (much) older workers will become commonplace. Eleven million people are facing an uncomfortable retirement due to changes in pension provision and a lack of savings. While I think this will require greater levels of flexibility in working patterns, I do not think this will lead to the end of the employee.

A flexible, task-based approach could benefit older workers who no longer want to work full-time, or younger workers who might wish to gain broad experience of the workplace. However, life and the workplace are a little more complex than that.

Demanding youth

I do not accept that younger generations lack the attention span to work for a single employer. I think they are more demanding about what good looks like, and more prepared to leave if they are unsatisfied. That does not equate to the end of a long-term employer / employee relationship when it still works for both parties.

Younger workers will still need stability to bring up families, buy properties and so on. From the employers’ point of view, the battle for talent is unlikely to diminish. If anything, it will become more intense as there is a shortage of specific skills. Continually recruiting on a project basis would place a huge strain on employers. So I suspect organisations will wish to strengthen the ties with their core staff, rather than diminish them.

Engagement is also vital to drive performance. Even nine years ago, Tower-Perrins 2006 survey found a 52% gap in income improvement between companies with engaged versus disengaged employees. Engagement comes when there is real alignment between employee and business principles. While I would not wish to disparage any hard-working freelancers, if an individual has a short-term view of the business, they are unlikely to drive long-term or cultural improvements.

As a result, I think the traditional employment relationship will continue to thrive in areas that are business critical. The flexibility in future employment models will come from restructuring within businesses themselves. I think non-core functions will be outsourced. There is no need for a brewery to have a superlative finance or HR function – a third party can do that for them.

Even here, organisations will not be entirely free of responsibility for their subcontracted employees. Social media ensures that the public are quick to condemn any organisation behaving in an irresponsible or unethical fashion. The power of the court of public opinion comes from its effect on the profit margin – as shown by some multi-national corporations’ decision to pay tax in the UK.

The demographic make-up of workplaces will change. It is possible that business structures will too. But levels of skill and engagement are unaffected by age. Organisations will always need the best people to work for them – however old they are. So ultimately, much of the relationship between a business and its top talent will stay the same.

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