To Keep Workers in Today’s Economy, Flexibility Is More Important Than Money

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CEOs know they have a tough road ahead. Many issues they’ve faced over the past two years—remote work, supply chain backups, product shortages, inflation—will likely subside with the pandemic or soon after, the labor shortage they’re up against now almost assuredly will not. The U.S.’s aging population and increasing retirements won’t resolve any time soon. Now business leaders have to change their salaries, benefits, and entire work cultures to one-up each other and reel in talent.

Marcus Buckingham has spent decades studying what makes people better and happier at work at Gallup, and his own HR consultancy that was eventually bought by ADP. Now he leads the ADP Research Institute, most recently conducting a 27-country survey of thousands of workers on what makes them love (or hate) their jobs. In his new book, Love + Work, out this month, he lays out how we can shape a more humane—and productive—future of work. He spoke with TIME about what that could look like, and what role managers play in the transformation.

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This interview has been condensed and edited for clarity.

The shape of work is constantly shifting, but most office employees seem to want sort of hybrid office-remote-work schedule at this point. What are you finding?

It’s pretty steady: You have 50% of people that now go back to the office every day. The remainder is split almost 50/50 either all remote or hybrid. The people who come into the office are both the most stressed, and the least stressed. And if you look at remote workers, it’s almost exactly the same. So it seems like it depends on the person, rather than the location. What people are really looking for isn’t flexibility of location. It’s flexibility of time. The pandemic has kind of shown everybody that we’re whole humans. [Ed. Note: At this point in the interview, my 3-year-old daughter ran into the room.] Like your kid today on spring break, we now know what she looks like and that she runs in every now and again. We want flexibility to go pick up my kid or pick up my grandma. All this hybrid talk misses the fact that it’s not the geography, the location. It’s the flexibility of being a whole human.

How do we square that with big business’s need for productivity? Can workers have the schedule that they want long-term without just working less?

Any CEO saying productivity slipped [during remote work] is making it up. The first question I would have for them would be: prove it. Measures of personal productivity at work are nowhere to be found. Really, really difficult to find. What we see is immense success, actually. We can see performance of the firms, and they did really, really well. What we’ve learned over the last two years is people can be just as productive, in fact probably more productive, when they have more flexibility of time.

The challenge for CEOs is really a real estate challenge. You’ve got all these really expensive offices and you got to find use for that. In general for workers—1.8 jobs for every job applicant, 3.5% unemployment—we now have way more power to choose. And we are changed humans after two years. The companies that miss us emotionally like that, they’re going to have big talent problems. Look at Jamie Dimon [CEO of JPMorgan Chase]. “You’re going to come back in the office.” Um, no you’re not, because then all the people can go work for a tech company that doesn’t have the same rules. Apple’s going to bump into the same thing.

“People are more productive when they hang out together around the cooler.” No, they’re not. None of that’s true. There’s no data on that at all. That doesn’t mean that we don’t need each other. Humans need other humans. But the CEO stuff about culture and development and productivity—that’s all just made up.

One question you pose is, is there such thing as good stress? If you have a more relaxed schedule, is there a negative or a positive in terms of how you can work without that adrenaline?

Well, there’s two things that we know, in answer to your question. And obviously the third one would be it depends on the individual. But putting that aside, we did a 27 country study, a stratified random sample of the workers in each country, 1,000 of them per country. And we were actually looking at resilience and inclusion. But we also decided to put in some stress questions, one of them was simply, “I have experienced significant stress at work in the last week.” And we asked on a scale of one to five. And we also had measures of, “Are you intending to leave the organization in the next three months? And are you actively interviewing to leave the organization in the next three months?”

In general, the pattern would be what you would expect: the people who strongly disagreed that they’d experienced significant stress had much higher levels of engagement and resilience and much less likelihood to be either intending to leave or actively interviewing. But to your point, weirdly, the second most positive set of outcomes in terms of resilience, engagement, and less likely to leave were people who strongly agreed that they experienced stress in the last week. So we’re like, “Wait a minute.” What’s the one set of conditions under which stress turns out to be a good thing? We found that the only time that stress is good is when you love what you do, and you’re good at it.

If you love what you do, and you’re not good at it, stress is bad. If you don’t love what you do, but you’re good at it, stress is really bad. If you don’t love it, and you’re not good at it, stress is really bad. And then under every other set of conditions it’s really bad. Brand new to the job, eight years into the job—bad, bad, bad, bad, bad. The only time stress is really good is when you feel deep mastery and love of the particular activity that you do.

Adrenaline is actually a really, really bad thing for your learning. But when when you love what you do, and you’re good at it, you don’t have cortisol and adrenaline and fight or flight coursing through your brain, because that shuts you down. You have norepinephrine and oxytocin and vasopressin and serotonin, you have this chemical cocktail in your brain that is almost the same chemical cocktail as when you’re in love with someone. And that opens you up to more information, more learning, you’re more creative, you perform cognitive tasks better, you pick up people’s emotions more accurately.

At home or not, stress is a function of when the particular activities you’re doing, for whatever reason, really fit you. If you give me time and flexibility, whether it’s at home or the office, to choose when I’m doing stuff and what I’m doing, I’m more productive and less stressed. And in any CEO doing something against that is just tilting against what is naturally human about us, which would seem to be a silly thing to do.

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In the grand scheme of the U.S. workforce, how many people do you think are in a job that they both love and are good at? And what do you think is the most important thing managers and bosses can do to alleviate worker stress—make people happier with their jobs—if they don’t love what they do? Plenty of people just need jobs.

The actual number is 51% of people who report they love what they do, which is a lot. I think the pandemic has helped, actually, because we’ve been by ourselves a lot. And 73% of people say they have a chance to maneuver their jobs to fit themselves better. So we’ve got more flexibility than we think. There’s a ton of love to be found in almost any job.

If you want to be a company that attracts people in these really tight labor markets, talking non-clichedly about, “We’re interested in who you are, and what you love to do, and how you can build your mastery here.” If you just had that as an explicit part of your talent brand. That’s non-trivial.

The next thing to do is pick spans of control. [Ed. Note: this is an HR term that refers to the number of direct reports each supervisor is responsible for.] Even pre-pandemic, nurses had high level of burn out, and levels of PTSD twice as high as veterans returning from war zones. One of the huge—not the only—but one of the big reasons is the nurse supervisor to nurse ratio in the United States, on average is 1:60. Sometimes going up to 1:100. You can’t help someone feel seen at work, you can’t maybe help them figure out what they love or what they’re good at and how to do a bit more of it if your ratio is 1:60. Change your spans of control, and rename them spans of attention, because that’s what they should be.

And then, if you want to reduce stress, put someone on a team. If you feel like you’re part of a team, you’re half as likely to say that you experienced stress in the last week. The two least resilient and least engaged professions are healthcare workers and teachers. There’s a lot of reasons—underfunding and maybe what I was saying about spans of control. But there are no teams in schools. There are no teams in hospitals, hospitals are vertically integrated through your discipline or function. And we’re like, “I wonder why nurses are leaving in droves?”

Does this connect to the push for unionization right now? Many companies that historically have pretty good pay and benefits, like Starbucks and Apple, are facing union elections.

Yes, this is a very interesting time for companies. Amazon took their base pay from something with 100 in front of it to 300. Target is now paying 25 bucks an hour. Companies are throwing money at this problem. And there’s no doubt people like money. I mean, that’s not a bad strategy. But as you said, even companies that seem to be doing a lot for their people are struggling with unionization or representation. And the reason this is a big wake up call for companies is that we are coming out of this pandemic as changed people. A lot of us anyway, we’ve had a lot of dark days, we’ve been by ourselves, we lost the cues of who we are at work. We got looked in the mirror, and we were like, “What the heck am I?” And some of the days you’re like, “I am me, I have value. I’m not just a cog in a machine, I want to work. I’m a whole human. And I want to be at a place that sees me as a whole human.” I want the company to see me as a whole human. If you don’t, then I will join a union that will. And I don’t think companies are ready for it.

We are going to have to the big call to arms to the HR function. Currently, even with a company like Apple, the HR function is set up to protect Apple from the people. That’s what it’s for. And when you combine those two things: I’m coming back to the workplace, I want to be seen as a whole human. And I realized that my company, even the HR function, is actually designed to sort of protect the company from me, that’s a bad mix.

Is there a world where HR shifts to not just protecting the company?

Well, no, I mean, maybe. I think we’re going to have this tight labor market for at least the next five years. So companies are going to have to be figuring out all sorts of things to do to be attractive to the best people. Right now, the HR function is an impediment to that. That’s kind of all part of Joseph Stiglitz’s “stakeholder capitalism,” where employees are one of four stakeholders. I think we’re going to move to a place where the best companies are going to go, “Now there’s one stakeholder, it’s the employees. That’s where the value is created. That’s where the products are made. If we really get that right, then we’re going to win.”

I don’t think we’re there yet. But I think the force of the labor market will make us get there. As the big banks in New York are finding out, you can’t come in and say the stupid things that those CEOs have been saying, you just look so out of touch. “You’re gonna come back to the office because we built a big one.” Tim, Tim, Tim…

You’ve studied a lot of companies. Are there any you think are doing this well and attracting employees because of it?

I think Lululemon does a good job of it. I’m not saying Lululemon is a perfect company, but they do the whole onboarding team joining thing really well by saying, “What are your personal goals? And if the goal is to be the CEO of Lululemon, that’s great, but if the goal is, ‘I want to go start my own shoe brand in three years, I want to open a yoga studio in five years,’ great, we’ll try to make them all happen.” That’s interesting. And the fact that when people do leave, their pictures are put on the wall. These are ex-employees, you go to a Lululemon, their pictures are on the wall as ambassadors of the brand. Most of the time you walk out of a company, you’re dead, your value is gone.

I actually just came from a huge construction company in San Antonio called Zachry, and they have a Dream Manager. His job is to interview every person about what their dreams are. I realize it sounds so naff as I’m saying it to you, but they had people in tears. I’m as cynical as the next person, but it was like, Okay, this company is crushing it right now and they’re talking to individual people who might have a high school diploma, they may not have a college degree, and they were just interviewing them one by one about what are your dreams? And how can we be part of those dreams? I think the future is stuff like that.

I think we all know that the pandemic has changed work. But do you think in two years we’ll be back to nine to five in the office, the same as we were before, and this is a distant memory? Or do you think this is going to be a real, permanent shift?

I don’t think there’s any doubt it’s the latter. Because the unemployment demographics are going to stay the way they are, and money won’t cut it. We’ve got way more power as employees than we’ve ever had before. And it’s going to be this way for the next five years, absent some sort of global conflict, which is possible, I guess.

Is that because the worker shortage will likely last for a years due to the aging population?

Yeah, yes, we’ve got more older people than we do younger people. And that’s going to stay. The labor force is going to get smaller. Wage inflation will happen because the workforce is so tight. And but I think what that means is the answer to your question is we’re not going back. Because if there’s a company that says, “You’re coming in,” then I’ll just go, “No, I won’t. I’ll go over here.” And there’ll be another company that will go, “Oh, ok, I think we can make that work.” You’re seeing that everywhere. We learned from the pandemic that we can actually maintain and increase our productivity if people aren’t in the office all the time. That doesn’t mean that everybody can not be in the office all the time, it does mean that we can be super productive as a company and give people more flexibility than we gave them before. It also, I think, means that when we stripped away all the stuff associated with work—the commutes, the checking in with your badge, the office party—a lot of us went, “This job is actually really badly designed and I don’t like it,” or, “I don’t need all that other stuff.” You have more agency, so you are more powerful. That feels good to anybody.

So yeah, I know we’re not going back. I mean, never say never because there could be a global war. But that aside, we’re not going back.