Peter Cappelli is routinely asked to predict the future of work. His expert answer is always the same: “The future looks like the past.”
The management professor at Penn’s Wharton School is not trying to be cryptic. It’s just that the big changes ushered in by the COVID-19 pandemic five years ago are still unfolding—remote and hybrid work, a tight labor market, and a renewed focus on office culture and employee wellness. Those trends that began in 2020 will continue into 2025, so any shifts will be incremental, he says.
Remote and hybrid work are still hot topics in the media, but the reality is less exciting. Only about a quarter of the U.S. labor force works from home, and more companies have called employees back into the office over the past year.
Cappelli said the recall is happening because cracks have begun appearing in the smooth pavement of remote work. It was great during the pandemic, when everyone was invested in its success. But as time has passed, it’s become clear that remote work comes with unique problems. Management, collaboration, and innovation are more difficult. And office culture takes a hit.
“You learn culture by observation, by seeing what’s rewarded and, particularly, what’s punished. You don’t even have gossip anymore to figure out who got fired for what,” he says.
Cappelli thinks perhaps the biggest change for American workers is the low unemployment rate, which has hovered around 4% for the last several years. It’s enabled employees to leverage their low supply with more demands, including better salaries and flexibility.
Yet most employers are doing little to stem the corresponding high rates of turnover. They don’t track their turnover numbers, much less share them with investors. Cappelli refers to it as a “financial accounting issue.” Companies easily measure compensation costs, but they don’t manage turnover costs because nobody sees them. However, those costs eventually show up in lower employee wellness and operational effectiveness, he says.
Read more at Knowledge at Wharton.
