Slight Uptick in Overall Index Led by Increased Trust in Company Leadership, WCI Now at its Highest Level in Five Quarters
PHILADELPHIA, PA – December 19, 2016 – Led by a slight uptick in overall trust in company leadership, American workers’ confidence increased for the third consecutive quarter in Q3 2016, according to the national Worker Confidence Index™, a survey of U.S. workers from HRO Today Magazine and Yoh, the leading international talent and outsourcing company owned by Day & Zimmermann. The index gauges workers’ perceptions of the four key drivers of worker confidence: the perceived likelihood of job loss, the perceived likelihood of a promotion, the perceived likelihood of a raise, and the perceived overall trust in company leadership.
Overall, the index grew to 99.9 from 99.7 in the second quarter of 2016. Despite the minor increase, the index saw workers’ “perceived likelihood of a raise” and “perceived likelihood of a promotion” fall slightly during the quarter, while workers’ “perceived likelihood of job loss” rose marginally. The index was saved by a 4.4-point increase in “trust in company leadership,” from 95.2 to 99.6.
With the small uptick, the overall index bucks a two-year trend of Worker Confidence falling between the second and third quarters. However, the third quarter of 2016 still saw dips in job security, likelihood of a raise and likelihood of a promotion, which remains consistent with previous years as workers typically feel less optimistic when the year-end performance reviews and holiday shopping season nears.
“While the overall results are positive, the negativity surrounding three out of the Index’s four categories should give pause to employers as workers did not report significant increases in confidence even as unemployment continues to fall and the markets near historic highs,” said Andy Roane, Vice President of Recruitment Process Outsourcing (RPO) for Yoh.
“As the Index showed last quarter, workers still appear apprehensive about the economy’s growth over the past year and may be wary about what the next year holds both for the markets and for their own job prospects.”
What Hiring Managers Can Do Now
“The start of a new year is the perfect time to conduct a business-wide talent assessment,” said Roane. “And now that we know the results of the U.S. presidential and congressional elections, businesses should assess their talent landscape and see how possible regulatory changes could affect their business as well as what their staffing needs and goals are for 2017.”
“The demand for talent among businesses is expected to increase even more in 2017, and only the companies with detailed and distinct plans for acquiring that talent, with the resources to help them achieve their goals, will be able to keep up with that demand.”
Other key takeaways of the Worker Confidence Index™ include:
- Despite drop, likelihood of a raise still higher than third quarter 2015
Workers’ perceived likelihood of a raise decreased slightly in the third quarter of 2016 from 102.5 to 100.3. However, optimism is still significantly higher than it was a year ago, which saw workers perceived likelihood of a raise at 93.8 in the third quarter of 2015. As has been the trend, men are more optimistic about raises when compared to women. Additionally, millennials were more optimistic than older generations, minorities were more optimistic than whites, and workers with at least some college education were more hopeful than the less educated of receiving a raise of 3 percent or more during their next review.
- Trust in company leadership at highest level in six quarters
Workers’ trust in company leadership to make sound decisions for the company and its employees skyrocketed to its highest level since the first quarter of 2015. Men reported much more trust in company leadership than women (46.7 percent compared to 39.5 percent). Interestingly, all age groups but one—those between the ages of 35 and 44— expressed more confidence in the company leadership in the third quarter of 2016 versus the second quarter.
- Continued alignment with Consumer Confidence Index
Since the study began, the Worker Confidence Index has aligned with the Consumer Confidence Index, showing identical rises and falls in worker confidence ahead of similar rises and falls in consumer confidence. The Worker Confidence Index is proving to be a leading indicator of future economic health in the U.S., indicating that employees’ confidence in their employment status impacts their buying power and the overall health of the American economy. During its nearly three years of existence, the Worker Confidence Index appears to be a more accurate predictor of economic health and U.S. spending power than unemployment rates, which have not aligned with consumer confidence.
Each month, HRO Today magazine employs ORC International's CARAVAN® Omnibus Surveys. Approximately 333 interviews are conducted online each month. Respondents are individuals age 18+ who are working full-time in the U.S. Quarterly reports are issued based on 1,000 responses per quarter. Respondents are asked a series of four questions. Each question uses a Likert-type scale where respondents rate each question on a 1-5 scale, with one being “Very poor” and 5 being “Very favorable.” The four questions asked are: Involuntary Job Loss Possibility, Likelihood of Promotion, Anticipation of a Raise of at least 3% and Trust in Company Leadership. To view the entire study, please visit, www.HROToday.com.