The future of work: what does it mean for employees?

This article is brought to you thanks to the collaboration of The European Sting with the World Economic Forum.

Author: Kerstin Alfes, Professor and Chair of Organisation and Human Resource Management, ESCP Business School (Berlin campus), Argyro Avgoustaki, Associate Professor of Management and Head of Research, ESCP Business School, London, Alexandra Beauregard, Professor of Organizational Psychology, Birkbeck College, University of London, Almudena Cañibano, Associate Professor in Human Resource Management, ESCP Business School, Madrid Campus, Maral Muratbekova-Touron, Professor of Management, ESCP Business School

• The way we work has been transformed in recent years, with the surge in remote work, freelance and contract arrangements, agile management and the digitalisation of tasks.
• These are not minor adaptations, but large-scale transformations that have taken place at an unprecedented speed and affected the workforce to an unprecedented extent, yet little is known about their impact on employee experience.
• This is why a team of researchers explored four major transformative processes and their benefits and downsides for employees’ attitudes, performance, skills, career advancement and well-being.

In 2023, it would not be far-fetched to proclaim that the traditional 9-to-5, in which employees clock in at 9 am and out at 5 pm, with a one-hour lunch break in the middle, is dead. Indeed, a large part of the 21st-century active population may be found either working from home, freelancing for several clients – possibly even as a digital nomad – or, on the lower rungs of society, taking their orders from the algorithms of an Uber-type food-delivery platform.

While work has always evolved, its recent transformation has taken place at an unprecedented speed and affected the workforce to an unprecedented extent. As we explained in an article on ‘new ways of working’ published in The International Journal of Human Resource Management, modern work arrangements challenge existing notions about where work takes place, how it is done, who does it and even what work is. The Covid-19 pandemic accelerated existing trends, suggesting that an increasing number of individuals carry out work in a non-traditional way.

So, when can work be described as ‘new’ as opposed to ‘old’ ways of working? Remote work is one obvious aspect. While the past couple of decades saw a significant increase in homeworking (up 115% in the US over the 2005-2015 period, for example), the Covid-19 crisis made it relevant to a majority of the workforce nearly overnight. Automation is another aspect, with estimates suggesting that in about 60% of occupations, one-third of tasks could be automated. Last, but not least, the number of gig workers – on temporary or freelance arrangements – is projected to rise to 78 million in 2023, up from 43 million in 2018.

These are not minor adaptations, but large-scale transformations. Yet little is known about their impact on employee experience. This is why we set out to explore four major transformative processes and their benefits and downsides for employees’ attitudes, performance, skills, career advancement and well-being.

1. Workspace and time

Flexible working, usually in the form of remote work, is generally perceived as beneficial for employees. Numerous studies show that they enjoy increased autonomy in managing their schedule and tend to report greater levels of satisfaction than their office-based counterparts, with such positive outcomes as reduced stress (no more commuting) and fewer work-life conflicts.

But, recent studies also show that ‘high-intensity teleworkers’ struggle over disconnecting outside working hours, which induces stress and exhaustion, with higher intentions to quit. While ‘telepresence robots’ (screens enabling co-workers to see each other) have been studied as a way to decrease feelings of isolation, they are also potential threats to privacy.

2. Work relations

The employment contract, once the basic foundation that ties individuals to an organization, in the words of the researchers, is waning. Instead, employment relations are now (more loosely) organized along such options as temp agency workers, freelancers, contractors, etc. This whole ‘gig economy’ has grown to the extent that crowd work represents the main job for 2% of the entire workforce in 14 countries in Europe. Gig jobs also include direct sales and the so-called ‘sharing economy’ where platforms digitally connect workers.

Discussions around gig jobs emphasise their positive aspects, such as schedule flexibility and higher levels of compensation (the latter evidenced by a 2019 study comparing Uber drivers with traditional taxis). Gig workers, however, often hold ‘precarious positions’ and lack social and job security compared to ‘regular’ employees. Plus, in a bid to appear continually available, freelancers tend to work irregular hours and their work is often in conflict with their private commitments. Although they may perceive their careers as successful, these are uncertain and fluid and without some level of organizational support, freelancers have limited chances to develop their skills.

Finally, for those being assigned tasks through the algorithms often embedded in the digital platforms of the sharing economy, the lack of human interaction and feeling of surveillance can result in reduced well-being.

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3. Content of work

Much ink has been poured about technology automating tasks previously carried out by humans, particularly dangerous or repetitive tasks, and about the fear – still very much alive – that jobs will simply disappear, with consequences in terms of anxiety for workers, especially among the less skilled.

More recently, research may have shown that machines may unleash human capabilities, but has also sparked questions about issues of agency that may arise for those working alongside ‘smart’ machines, with possible surveillance issues and broader questions about new relations of power, authority and identity.

4. Allocation and organization of work

Conventional management hierarchies are evolving towards more agile, participative ways of working. Agility is presented as a mainly positive new way to allocate work for employees, with improved engagement and satisfaction. The increased autonomy given to teams helps them navigate uncertain environments and contributes to the psychological empowerment and motivation of agile teams, with positive implications for the team’s innovative behaviour and project performance.

One caveat is that when management is delegated to algorithms in digital platforms, empathy and human connection are lost.

Challenges for human resources

Given the increase in non-traditional ways of working, HR practices need to adapt. For instance, HR practices that are less often included in traditional HR bundles, such as well-being programmes or practices promoting job security, might be of high relevance to workers who are at the periphery of organizations (e.g. temporary or agency workers).

Regarding flexibility, they must consider how to align the demands of workers (many of whom are less than keen to return to the office) and the operational needs of managers (persons present on-site to train new recruits, for instance). HR professionals will need to develop sophisticated solutions to all of these challenges.