1 00:00:03,180 --> 00:00:06,210 Sean Aylmer: Welcome to the Fear and Greed daily interview. I'm Sean Aylmer. 2 00:00:06,600 --> 00:00:10,500 Sean Aylmer: Australian workers are feeling pretty overwhelmed right now. According to 3 00:00:10,500 --> 00:00:15,570 Sean Aylmer: Gartner's Global Talent Monitor, Australian employees are feeling uneasy about 4 00:00:15,570 --> 00:00:18,599 Sean Aylmer: the future of work and their wellbeing. It's a pretty 5 00:00:18,600 --> 00:00:21,509 Sean Aylmer: grim snapshot of the local labour force. So I wanted 6 00:00:21,510 --> 00:00:24,540 Sean Aylmer: to find out why confidence has taken such a hit 7 00:00:24,900 --> 00:00:28,530 Sean Aylmer: and whether there's any positivity ahead. Aaron McEwan is Vice 8 00:00:28,530 --> 00:00:33,300 Sean Aylmer: President of Research & Advisory for Gartner's HR Practice. Aaron, welcome 9 00:00:33,300 --> 00:00:34,050 Sean Aylmer: to Fear and Greed. 10 00:00:34,229 --> 00:00:35,760 Aaron McEwan: My pleasure to be here. Thank you. 11 00:00:36,180 --> 00:00:39,960 Sean Aylmer: So Australian employees have reported their lowest- ever rates of 12 00:00:39,960 --> 00:00:43,920 Sean Aylmer: financial and physical wellness. Just how low is it and why? 13 00:00:44,280 --> 00:00:47,760 Aaron McEwan: Well, it's at record- low levels. So when we look 14 00:00:47,760 --> 00:00:52,199 Aaron McEwan: at overall wellness, which includes mental wellness, physical wellness, and 15 00:00:52,200 --> 00:00:58,350 Aaron McEwan: financial wellness, it's currently sitting at only 31.1% of the Australian 16 00:00:59,070 --> 00:01:03,660 Aaron McEwan: working population that report high levels of wellbeing. So that's 17 00:01:03,660 --> 00:01:07,170 Aaron McEwan: actually the lowest we've ever seen and it's a fairly 18 00:01:07,170 --> 00:01:11,520 Aaron McEwan: sharp decline even from the previous months. So back in 19 00:01:11,520 --> 00:01:15,240 Aaron McEwan: December, things were looking a little better. Unfortunately, as we 20 00:01:15,240 --> 00:01:19,559 Aaron McEwan: find ourselves here in quarter one of this year, they're 21 00:01:19,560 --> 00:01:20,190 Aaron McEwan: even lower. 22 00:01:20,580 --> 00:01:22,590 Sean Aylmer: So what's the reason? Why is that happening? 23 00:01:23,819 --> 00:01:29,220 Aaron McEwan: Well, part of it is predictable. So epidemiologists often refer 24 00:01:29,220 --> 00:01:32,279 Aaron McEwan: to a fourth wave of a pandemic, and I don't 25 00:01:32,280 --> 00:01:35,459 Aaron McEwan: want that to be confused with another wave of COVID, 26 00:01:35,459 --> 00:01:39,720 Aaron McEwan: for example, but rather that pandemics tend to happen in 27 00:01:39,720 --> 00:01:44,340 Aaron McEwan: phases. So the first phase is the direct impact on 28 00:01:44,340 --> 00:01:48,510 Aaron McEwan: health of the population due to the virus itself. And 29 00:01:48,510 --> 00:01:53,130 Aaron McEwan: then the second component is related to the flow on 30 00:01:53,130 --> 00:01:55,920 Aaron McEwan: impacts of that. So the impact on the healthcare system 31 00:01:55,920 --> 00:01:59,310 Aaron McEwan: as it orients to the first wave. Third wave is 32 00:01:59,310 --> 00:02:04,380 Aaron McEwan: the untreated chronic illnesses that just end up being overlooked 33 00:02:04,680 --> 00:02:08,579 Aaron McEwan: as the health system is kind of overwhelmed. But the 34 00:02:08,580 --> 00:02:13,200 Aaron McEwan: fourth wave or phase is what's commonly referred to as 35 00:02:13,200 --> 00:02:17,700 Aaron McEwan: psychological injury. So this is all of the psychosocial impacts 36 00:02:17,700 --> 00:02:21,959 Aaron McEwan: of that kind of accumulated trauma, the deaths, and sickness 37 00:02:21,960 --> 00:02:25,440 Aaron McEwan: that people have experienced, but also the economic trauma that 38 00:02:25,440 --> 00:02:29,070 Aaron McEwan: comes with pandemics. So it looks as though we are 39 00:02:29,070 --> 00:02:33,870 Aaron McEwan: well into that fourth phase. And as a result, things 40 00:02:33,870 --> 00:02:38,399 Aaron McEwan: like mental health and overall mental wellness are being impacted 41 00:02:38,400 --> 00:02:43,019 Aaron McEwan: really significantly, so to his physical wellness and financial wellness. 42 00:02:43,590 --> 00:02:46,050 Aaron McEwan: And of course, all of this is happening at a 43 00:02:46,050 --> 00:02:50,790 Aaron McEwan: period where we're experiencing inflationary pressures and rising interest rates. 44 00:02:51,480 --> 00:02:55,590 Aaron McEwan: So it's a challenging time for employees. They're feeling fatigued 45 00:02:55,590 --> 00:02:57,990 Aaron McEwan: and burnt out and pretty stressed. 46 00:02:58,710 --> 00:03:01,080 Sean Aylmer: I suppose the flip side to it, as you were 47 00:03:01,080 --> 00:03:04,110 Sean Aylmer: talking then I kind of understand all that. Having said 48 00:03:04,110 --> 00:03:06,420 Sean Aylmer: that, you can get another job if you want to. 49 00:03:07,020 --> 00:03:09,720 Sean Aylmer: Unemployment's three and a half percent, so it's not like 50 00:03:09,720 --> 00:03:11,880 Sean Aylmer: people can't change jobs, or am I being a little 51 00:03:11,880 --> 00:03:12,540 Sean Aylmer: too harsh? 52 00:03:13,740 --> 00:03:16,709 Aaron McEwan: No, I don't think you're being harsh. Our data certainly 53 00:03:16,710 --> 00:03:21,900 Aaron McEwan: points to a pretty buoyant, what we would call confidence 54 00:03:21,900 --> 00:03:26,070 Aaron McEwan: in the job market. So that's still at relatively record 55 00:03:26,070 --> 00:03:32,639 Aaron McEwan: highs. It's declining a little bit. So Australian employees' perceptions 56 00:03:32,639 --> 00:03:36,120 Aaron McEwan: of the availability of jobs are pretty high. But there's 57 00:03:36,120 --> 00:03:39,690 Aaron McEwan: also some datas that suggest that those people who did 58 00:03:40,050 --> 00:03:44,339 Aaron McEwan: move during the 'great resignation,' and I'm putting inverted commenters 59 00:03:44,340 --> 00:03:48,330 Aaron McEwan: around that, there are reports of some regrets. So people 60 00:03:48,330 --> 00:03:51,060 Aaron McEwan: haven't necessarily found that the grass is greener on the 61 00:03:51,060 --> 00:03:54,540 Aaron McEwan: other side, so to speak. So whilst there's lots of 62 00:03:54,630 --> 00:04:00,360 Aaron McEwan: opportunity, I think employees are certainly feeling that sense of 63 00:04:00,360 --> 00:04:04,020 Aaron McEwan: being burnt out. So I think many of them probably 64 00:04:04,020 --> 00:04:06,660 Aaron McEwan: don't want to jump out of the frying pan into 65 00:04:06,660 --> 00:04:07,860 Aaron McEwan: the fire, so to speak. 66 00:04:08,430 --> 00:04:11,160 Sean Aylmer: Okay. It mustn't be great for productivity either. I know 67 00:04:11,160 --> 00:04:13,680 Sean Aylmer: the Reserve Bank Governor Philip Lowe in the past few 68 00:04:13,680 --> 00:04:16,260 Sean Aylmer: days has spoken quite a bit about the need to 69 00:04:16,260 --> 00:04:20,040 Sean Aylmer: improve productivity, get more out of each unit of input. 70 00:04:20,550 --> 00:04:20,790 Aaron McEwan: Yeah. 71 00:04:21,120 --> 00:04:24,240 Sean Aylmer: When people aren't feeling great though, that's a hard thing 72 00:04:24,240 --> 00:04:24,630 Sean Aylmer: to do. 73 00:04:25,320 --> 00:04:29,220 Aaron McEwan: Yeah, it certainly does impact on things like discretionary effort. 74 00:04:29,460 --> 00:04:33,000 Aaron McEwan: So employees' willingness to go above and beyond. However, we're 75 00:04:33,000 --> 00:04:38,640 Aaron McEwan: not seeing particularly low levels of discretionary effort compared to 76 00:04:38,640 --> 00:04:42,750 Aaron McEwan: other periods. Some people have concerns around the concept of 77 00:04:42,750 --> 00:04:45,539 Aaron McEwan: quiet quitting. So this is people just putting in the 78 00:04:45,540 --> 00:04:49,230 Aaron McEwan: bare minimum, and I'm sure that will flow through to productivity. 79 00:04:49,800 --> 00:04:51,839 Aaron McEwan: But I think a more important point that needs to 80 00:04:51,839 --> 00:04:56,520 Aaron McEwan: be made is that in a world that's dominated by knowledge work, 81 00:04:56,970 --> 00:05:01,080 Aaron McEwan: which is becoming more complex and more human over time, 82 00:05:01,410 --> 00:05:06,419 Aaron McEwan: particularly with the impact of automation and ChatGPT and generative AI, 83 00:05:06,450 --> 00:05:10,770 Aaron McEwan: get a pretty big share of the focus of that 84 00:05:10,770 --> 00:05:13,799 Aaron McEwan: at the moment. But I'm not sure that productivity is 85 00:05:13,800 --> 00:05:17,220 Aaron McEwan: really the best measure when you are dealing with complex 86 00:05:17,220 --> 00:05:21,659 Aaron McEwan: knowledge work. To produce the type of outputs that knowledge 87 00:05:21,660 --> 00:05:26,910 Aaron McEwan: work requires, people need to be well rested and they 88 00:05:26,910 --> 00:05:29,010 Aaron McEwan: need to be in a good place to think through 89 00:05:29,010 --> 00:05:34,469 Aaron McEwan: those complex issues. So yes, there is a productivity decline 90 00:05:34,470 --> 00:05:37,830 Aaron McEwan: when we see such high levels of stress and mental 91 00:05:37,830 --> 00:05:42,420 Aaron McEwan: health problems. But it's not really inputs and outputs that 92 00:05:42,420 --> 00:05:45,360 Aaron McEwan: we should be measuring. It gets much better to the 93 00:05:45,360 --> 00:05:48,839 Aaron McEwan: quality of that output. So yes, I do think there's 94 00:05:48,839 --> 00:05:53,339 Aaron McEwan: a linkage between productivity and these declines in wellness that 95 00:05:53,339 --> 00:05:56,640 Aaron McEwan: we've seen, but I think the solution to fixing that 96 00:05:56,640 --> 00:05:57,930 Aaron McEwan: is a little bit more complex. 97 00:05:59,160 --> 00:06:02,250 Sean Aylmer: Now, the Global Talent Monitor which came the most recent, 98 00:06:02,700 --> 00:06:06,690 Sean Aylmer: Gartner Global Talent Monitor, talked about three drivers of attrition 99 00:06:06,690 --> 00:06:12,420 Sean Aylmer: in Australian workplaces being manager quality, respect, and people management. 100 00:06:12,660 --> 00:06:15,839 Sean Aylmer: Money doesn't really come into till number four. What's that 101 00:06:15,839 --> 00:06:16,500 Sean Aylmer: telling us? 102 00:06:17,760 --> 00:06:21,420 Aaron McEwan: It tells us a pretty consistent story. So Australia differs 103 00:06:21,420 --> 00:06:24,630 Aaron McEwan: from the rest of the world in that compensation is 104 00:06:25,170 --> 00:06:29,549 Aaron McEwan: typically sitting in the top five, but generally not in 105 00:06:29,550 --> 00:06:32,910 Aaron McEwan: the top three. It's actually number one around most of 106 00:06:32,910 --> 00:06:35,190 Aaron McEwan: the rest of the world. So there is a difference there. 107 00:06:35,760 --> 00:06:38,940 Aaron McEwan: But what it definitely points to is that Australian workers 108 00:06:38,940 --> 00:06:44,550 Aaron McEwan: seem to value their lifestyle, their flexibility, and their autonomy 109 00:06:44,670 --> 00:06:49,680 Aaron McEwan: around work really highly. So the reason why manager quality 110 00:06:50,070 --> 00:06:54,240 Aaron McEwan: tends to sit up there pretty high is usually because 111 00:06:54,690 --> 00:07:00,270 Aaron McEwan: a person's manager is the key determinant of the first one, 112 00:07:00,330 --> 00:07:05,070 Aaron McEwan: which is location. So location is really pointing to... It's 113 00:07:05,070 --> 00:07:08,099 Aaron McEwan: not having an attractive office in the CBD that you 114 00:07:08,100 --> 00:07:10,860 Aaron McEwan: can go to, for example. It's more, " Do I have 115 00:07:10,860 --> 00:07:14,730 Aaron McEwan: autonomy over where I work, when I work, and how 116 00:07:14,730 --> 00:07:18,930 Aaron McEwan: much work I do?" And so this is really pointing 117 00:07:18,930 --> 00:07:22,890 Aaron McEwan: to this kind of hybrid work emerging as the most 118 00:07:23,130 --> 00:07:27,450 Aaron McEwan: preferred model for employees. But what they recognise is that 119 00:07:27,450 --> 00:07:30,660 Aaron McEwan: the degree to which their manager respects them and encourages 120 00:07:30,690 --> 00:07:35,460 Aaron McEwan: that access to autonomy and flexibility ultimately determines what their 121 00:07:35,460 --> 00:07:39,600 Aaron McEwan: experience of work is. So no kind of surprise here 122 00:07:39,600 --> 00:07:42,390 Aaron McEwan: that employees are leaving managers that don't do a very 123 00:07:42,390 --> 00:07:43,350 Aaron McEwan: good job around that. 124 00:07:43,470 --> 00:07:45,360 Sean Aylmer: Stay with me, Aaron. We'll be back in a minute. 125 00:07:50,910 --> 00:07:53,760 Sean Aylmer: My guest this morning is Aaron McEwan, vice president of 126 00:07:53,760 --> 00:07:58,410 Sean Aylmer: Research & Advisory for Gartner's HR Practice. Respect is another one... 127 00:07:58,680 --> 00:08:02,550 Sean Aylmer: It's all interlinked. I get that. But respect is such 128 00:08:02,550 --> 00:08:05,100 Sean Aylmer: an important part of the workplace. It's seen anywhere I've 129 00:08:05,100 --> 00:08:11,220 Sean Aylmer: worked, not just managers respecting employees, but also individuals respecting 130 00:08:11,220 --> 00:08:12,510 Sean Aylmer: each other no matter what they do. 131 00:08:12,900 --> 00:08:16,890 Aaron McEwan: Yeah. So this gets to something that's been really one 132 00:08:16,890 --> 00:08:19,200 Aaron McEwan: of the more profound shifts that we saw come through 133 00:08:19,200 --> 00:08:22,560 Aaron McEwan: the pandemic. To sum it up as simply as I 134 00:08:22,560 --> 00:08:27,540 Aaron McEwan: can, workers want to be seen as human beings, not 135 00:08:27,540 --> 00:08:32,910 Aaron McEwan: workers. And so this notion of respect has really risen 136 00:08:32,910 --> 00:08:35,730 Aaron McEwan: up the ranks of reasons why people will leave a 137 00:08:35,730 --> 00:08:38,910 Aaron McEwan: company, but also why they will join a new one. 138 00:08:39,600 --> 00:08:43,229 Aaron McEwan: And it's really got to do with, " Are they treated 139 00:08:43,679 --> 00:08:46,950 Aaron McEwan: and seen as a human being or are they seen 140 00:08:47,010 --> 00:08:50,760 Aaron McEwan: as a means to production?" So that gets to my 141 00:08:51,030 --> 00:08:55,079 Aaron McEwan: earlier point around productivity is not really the way that 142 00:08:55,080 --> 00:08:58,890 Aaron McEwan: employees want to be seen in terms of the value 143 00:08:58,890 --> 00:09:02,940 Aaron McEwan: that they add to an organization. So those notions of 144 00:09:02,940 --> 00:09:07,620 Aaron McEwan: flexibility and autonomy become really important to employees in this 145 00:09:07,620 --> 00:09:11,429 Aaron McEwan: kind of post- COVID or post- pandemic environment. 146 00:09:12,030 --> 00:09:14,640 Sean Aylmer: Do we ever go back to how it was? Is 147 00:09:14,640 --> 00:09:17,040 Sean Aylmer: this a phase we're going through? Where are we going 148 00:09:17,040 --> 00:09:18,840 Sean Aylmer: to be in two or three years time? 149 00:09:19,200 --> 00:09:22,350 Aaron McEwan: I definitely don't think there's any going back to. Now 150 00:09:22,350 --> 00:09:27,179 Aaron McEwan: that's despite some of the desires that we see from 151 00:09:27,179 --> 00:09:31,290 Aaron McEwan: senior leadership around the country. There is a strong desire 152 00:09:31,290 --> 00:09:34,829 Aaron McEwan: to go back to that pre- pandemic world. The trends 153 00:09:34,830 --> 00:09:38,730 Aaron McEwan: that we've seen didn't start with the pandemic. They actually 154 00:09:38,730 --> 00:09:42,090 Aaron McEwan: started a long time before it, but arguably the pandemic 155 00:09:42,090 --> 00:09:45,420 Aaron McEwan: accelerated a lot of these things. So I think we're 156 00:09:45,420 --> 00:09:48,030 Aaron McEwan: well and truly past the point of no return when 157 00:09:48,030 --> 00:09:48,660 Aaron McEwan: it comes to that. 158 00:09:48,809 --> 00:09:52,020 Sean Aylmer: So the world is different. It probably means that managers 159 00:09:52,020 --> 00:09:56,189 Sean Aylmer: and companies have to learn very, very quickly about how 160 00:09:56,280 --> 00:09:59,580 Sean Aylmer: to be managers and look after their people if they 161 00:09:59,580 --> 00:10:00,270 Sean Aylmer: want to succeed. 162 00:10:00,690 --> 00:10:05,580 Aaron McEwan: Yeah, absolutely. And it's kind of ironic. Prior to the 163 00:10:05,580 --> 00:10:08,130 Aaron McEwan: pandemic, one of the predictions that we had at Gartner 164 00:10:08,130 --> 00:10:12,179 Aaron McEwan: was that within the next six to seven years, and 165 00:10:12,179 --> 00:10:17,190 Aaron McEwan: this was back in 2019, about 86 to 87% of 166 00:10:17,190 --> 00:10:21,900 Aaron McEwan: the tasks that managers performed would be automated. So we're 167 00:10:21,900 --> 00:10:24,630 Aaron McEwan: still on track to achieve that and in fact, with 168 00:10:24,630 --> 00:10:29,489 Aaron McEwan: the emergence of generative AI, that future might come a 169 00:10:29,490 --> 00:10:33,179 Aaron McEwan: little bit quicker. So in a kind of ironic twist, 170 00:10:33,179 --> 00:10:37,829 Aaron McEwan: the pandemic saved managers almost from extinction. And what I 171 00:10:37,830 --> 00:10:42,300 Aaron McEwan: mean by that is that what's become really apparent during 172 00:10:42,300 --> 00:10:45,480 Aaron McEwan: the pandemic and after is that what employees are looking 173 00:10:45,480 --> 00:10:50,580 Aaron McEwan: for are managers who are empathetic, agile, that are able 174 00:10:50,580 --> 00:10:54,480 Aaron McEwan: to see them as human beings and adjust the way 175 00:10:54,480 --> 00:10:57,690 Aaron McEwan: that they work with them to get the best outcomes. 176 00:10:58,110 --> 00:11:01,050 Aaron McEwan: So in this kind of new world, managers need to 177 00:11:01,050 --> 00:11:05,429 Aaron McEwan: become much better at understanding the individuals that work for 178 00:11:05,429 --> 00:11:08,850 Aaron McEwan: them, what motivates them, how to craft their work in 179 00:11:08,850 --> 00:11:11,220 Aaron McEwan: such a way that it's not just meaningful and has 180 00:11:11,220 --> 00:11:15,300 Aaron McEwan: purpose, but that it can be delivered in sustainable ways 181 00:11:15,300 --> 00:11:19,590 Aaron McEwan: that don't negatively impact things like mental health and burnout. 182 00:11:20,100 --> 00:11:24,209 Aaron McEwan: So those are very human things that thankfully the robots 183 00:11:24,300 --> 00:11:28,230 Aaron McEwan: can't do yet. So yeah, absolutely. The role of managers 184 00:11:28,230 --> 00:11:31,440 Aaron McEwan: has changed fundamentally since the pandemic. 185 00:11:32,190 --> 00:11:34,080 Sean Aylmer: Aaron, thank you for talking to Fear and Greed. 186 00:11:34,530 --> 00:11:35,670 Aaron McEwan: No worries. My pleasure. 187 00:11:35,970 --> 00:11:39,270 Sean Aylmer: That was Aaron McEwan, vice president in the Gartner HR 188 00:11:39,270 --> 00:11:42,030 Sean Aylmer: Practice. This is the Fear and Greed daily interview. Join 189 00:11:42,030 --> 00:11:44,040 Sean Aylmer: us every morning for the full episode of Fear and 190 00:11:44,040 --> 00:11:48,000 Sean Aylmer: Greed, Australia's most popular business podcast. I'm Sean Aylmer. Enjoy 191 00:11:48,000 --> 00:11:48,360 Sean Aylmer: your day.