Worker Confidence Defies Slowing Wage Growth Trends

A new report of U.S. jobs and employment data reveals a series of pivotal shifts that will shape workforce dynamics in 2024, including fewer full-time workers, a decline in remote work, changes to employee benefits and more.  

According to a December 2023 report from Morning Consult, there has been a notable decline in the share of workers engaged in full-time employment (the share of employed adults working 35 hours) with a roughly 9 percentage point drop from its peak in 2022.  

The labor market appears to be cooling, with a decrease in labor shortages and a slowdown in nominal wage growth. Despite this, U.S. workers remain confident in their ability to negotiate higher pay. This confidence could be attributed to the recent trends in labor market tightness and a period of increased employee activism — including major labor strikes across various industries including Automotive, Tech, and Entertainment.  

According to an analysis of the data published by Axios, the recent polling data from Morning Consult reveals another notable trend: fewer workers are working primarily from home. While remote work is still more common than before the pandemic, the trend towards hybrid work arrangements is becoming increasingly the preferred choice among employers.  

There is also a notable decline in the share of U.S. employers offering key benefits like health insurance and retirement contributions. According to Morning Consult, this is particularly prevalent in relatively low-skill industries including food & beverage, leisure & hospitality, and retail. The reduction in these kinds of employee benefits could have long-term implications for employees and job retention in 2024. 

The report suggests that while the labor market is showing signs of cooling, which aligns with the Federal Reserve’s efforts to slow the economy through interest rate hikes, there is still an underlying strength in the labor market. As these trends develop and are observed in 2024, they will undoubtedly influence how organizations structure their workplaces and employee benefits.