The “Great Resignation” has shifted the balance of bargaining power from employer to employee. Those with talents in demand are using their power to demand favourable working conditions; with remote and hybrid working options often at the top of the list of expectations, while the four-day working week gains momentum across Europe.

Companies who hope this will blow over are in for a rude awakening. So far, there’s no sign of the hiring balance shifting back to how things were pre-pandemic. ManpowerGroup found just 31% of employers struggled with hiring in 2010, a figure that had more than doubled by 2021. As with many societal changes we’ve seen as a result, the pandemic simply accelerated a shift that was already taking place.

To understand how this trend has affected European finance workers, let’s see what the latest research reveals about their attitudes to work in the remote/hybrid era and what it suggests about the future of employment in and beyond the sector.

What do Europe’s finance workers want?
Flexibility is the number one demand of today’s knowledge workers. Of the 10,737 surveyed by Future Forum, 78% said they wanted location flexibility, with 68% preferring hybrid working, and 95% wanted schedule flexibility.

 Finance workers have been well served in this regard. In July 2022, YouGov surveyed over 1,000 finance professionals across France, Germany, and the UK on behalf of Spendesk, and found that between 60-70% are satisfied with the remote work opportunities provided by their company and only around 20% have felt pressured to return to the office. Many no longer consider remote working terms a ‘perk’ but a requirement, with a third of finance workers in the UK saying they would consider leaving their job if they had to return to the office full time.

Hybrid and remote working arrangements provide much more than convenience for those who choose them. Over two-thirds of respondents in the Spendesk survey said that trust in the workplace had either improved or remained steady since the generalisation of remote work, while Future Forum found that remote and hybrid workers scored better than their in-office counterparts across every aspect of the work experience they were asked about — including job satisfaction, sense of belonging, better work-life balance, and reduction of stress and anxiety.

Good news for employees, but what about employers? Has worker satisfaction translated to increased productivity? The answer is a resounding ‘yes’: a report from Catalyst found that productivity increased among employees who have access to remote options, while 71% of employers surveyed by the CIPD stated home working boosted or made no difference to job performance.

The survey* found that financial workers in the UK have made the transition most smoothly, with only 24% of finance workers reporting increased communication difficulties as a result of remote work, compared to 36% in Germany and 31% in France. One area where all countries showed room for improvement was preferential treatment of office attendees; with a third of respondents in Germany and two-fifths in France and the UK worried that working remotely would mean they are treated less favourably.

Mandating full-time office attendance may be discriminatory
In an era when workers are keen to jump ship for a healthier work-life balance and professional fulfilment, business reputation matters more than ever. Giants such as Tesla might be able to weather the reputational damage of forcing staff back to the office when they have proven to be just as productive remotely, but companies who do not have such brand appeal are more likely to experience a talent exodus.

Risk to reputation is compounded when the demographics of those who prefer remote work are considered. In the Future Forum survey, a higher percentage of women said they wanted to work remotely than men; while Hispanic, Black, and Asian respondents were more likely to prefer remote or hybrid models than white respondents.

As the Gender Pay Gap Bot proved earlier this year, companies must ensure their actions are consistent with their values. If women, ethnic minorities, and people with disabilities are the most likely to utilise remote and hybrid work, mandated full-time office attendance limits opportunities for those who are already underrepresented.

The concept of the four-day working week has picked up steam and, if it becomes widely adopted, will provide further flexibility for those who struggle to fit their lives and needs around the classic nine to five. In the Spendesk survey, the overwhelming majority (77–79%+) of respondents would prefer a four-day working week, though France is the only country where employers are paying much attention: 20% of respondents in France said their company is exploring the option, versus 9% in Germany and just 5% in the UK.

A remote/hybrid workforce is an opportunity, not a cost
There are several working models companies can adopt to ensure fair pay across the board, while allowing for differences in employee circumstances. Today’s salary equations are much more complex than just compensating for a particular job function because companies can now access labour markets at a global scale, with the ability to adjust salaries for each region.

In a nine-to-five office-based world where staff  are concentrated in a single location such as London or Paris, salaries are inflated by high cost of living. In this scenario, a company must pay more to get the talent it needs as the pool is limited, making salaries unrepresentative of the actual value and impact of the role.

However, if companies allow the talent pool to expand with the emergence of remote/hybrid work, there will be less pressure to artificially inflate salaries. As cost of living varies dramatically with location, employees will likely have more purchasing power with lower pay than their colleagues in cities. This necessitates action from a company to ensure pay fairly reflects the different circumstances of staff. This approach is fairest for those whose cost of living is driven up by factors beyond their control, while still attracting and accommodating talent outside of major cities and developed countries.

With inflation surging across the globe, hiring talent in areas where a high quality of life can be provided at lower salaries than the traditional urban work centres can help to keep a lid on economically dangerous wage-price spirals. Companies should seize this opportunity to create workplaces that make their employees happier, support diversity, transform society, and improve sustainability — all while improving their bottom line.

*Spendesk