| INTEGRATIVE INSIGHTS ON EMERGING OPPORTUNITIES |
Integrative research means our extensive company research informs every thesis and perspective. The result is deep industry knowledge, expertise, and trend insights that yield valuable results for our partners and clients.
cgreendale@firstanalysis.com
ctran@firstanalysis.com
- While the war for talent may cool in some sectors in the near term, long-term trends including aging populations, the increasing need for technology skills, and shifting personal values among younger workers suggest a truce is nowhere in sight. We expect recruiting, retaining and cultivating talent to remain a challenge that requires a growing arsenal of innovative technologies for building, developing and managing workforces.
- Regardless of economic conditions, we expect employers to increasingly adopt software-enabled employee coaching as a key part of that arsenal. By improving employee performance and career growth, coaching increases satisfaction and retention among remaining employees in companies experiencing layoffs and reduces the pressure to hire replacement and new talent in growth periods. Software makes coaching more convenient, faster, effective, less expensive and better integrated with daily work life by expanding the range of resources available for employee development relative to place-bound approaches and by simplifying and automating matching and scheduling, making it possible for employees and coaches to interact anytime, from any location.
- Given coaching's compelling return on investment and employers' strong appetite for tools to address the long-term challenges to building and maintaining workforces, we expect to see continued strong demand for software-enabled coaching. We review some of the near-term and long-term trends driving demand, discuss how coaching platforms help in the war for talent, and profile several innovative employee coaching platforms.
TABLE OF CONTENTS
Includes discussion of nine private companies
Elevated quit rates, other data show importance of retaining, developing talent
Coaching can increase retention, improve employee capabilities
Technology makes coaching even more compelling
Large and growing market for online employee coaching
Coaching to win
Future of Work index remains rangebound in deeply negative territory for the year
Future of work M&A: Notable transactions include TalentReef, Hitch Works, and BrainPOP
Future of work private placements: Focus on optimizing compensation, workforce globalization
Elevated quit rates, other data show importance of retaining, developing talent
Our previous reports have detailed a variety of trends that illustrate the challenges employers face in recruiting, retaining and growing talent. We highlight two recent data points that underscore the importance of the latter two objectives. First, U.S. quit rates - the number of quits per month as a percent of total employment - remain near historical highs. The most recent data from the U.S. Bureau of Labor Statistics showed the seasonally adjusted September 2022 quit rate at 2.7%, down from 3.0% at the end of 2021 (a 20-year high) but stable over the past few months despite a softening economy and still well above the 1.9% average prior to 2021. At the same time, the percentage of unfilled job openings remains at or near historical highs. The bureau reported the seasonally adjusted September job opening rate at 6.5%, down from March 2022's 20-year high of 7.3% but up from the prior month and still almost double the average prior to 2021. If employers can reduce quit rates and help their employees become more productive and capable, they can reduce their need to replace and add talent.