The rise of remote work and a hot labor market made the second half of 2022 a welcoming environment for “quiet quitters.” The term — which originally went viral thanks to TikToker Zaid Khan in a video romanticizing the work/life balance — refers to the idea of not outright quitting your job but quitting the idea of going above and beyond at it.
Now, on the opposite side of the spectrum, is a new workplace buzzword known as “quiet hiring.” While quiet quitting and low productivity is a half a trillion dollar problem in the U.S. alone, quiet hiring has the potential to save companies in onboarding costs as the goal is to acquire new skills without actually hiring new full-time employees.
On the one hand, the concept allows finance leaders to address immediate needs of the company in a cost-efficient manner. At the same time, when not executed mindfully, it has the potential to backfire as existing employees may feel undervalued if they are forced to do more with less or compete with independent contractors.
Internal vs external
There are two ways to execute quiet hiring, said Emily Rose McRae, human resources expert and senior director of research at Gartner in an interview with CFO Dive.
Internal quiet hiring is when organizations will ask their already existing employees to temporarily work on a new project or in a new role. “Senior executives will evaluate their headcount and realize they need to move people from one role to another role. The skill sets could be relatively similar, so the shift won't take major upskilling,” said McRae.
For example, you may see an organization moving their marketing research team over to work on data science with software developers, she said.
External quiet hiring, is when an organization hires short-term contractors to address acute needs of the organization right away.
This type of quiet hiring comes into play when an organization knows that they have gaps to fill and they cannot find the talent to address them within, but they also can’t add additional headcount.
A potential tension point
“The tight labor market is not going anywhere anytime soon,” said McRae, and CFOs should expect lingering obstacles when it comes to hiring workers in 2023, like limits on immigration, an aging and shrinking labor force, and a surge of early retirements stemming from the pandemic.
“Employers are having to get creative,” said McRae. “This just means organizations are doing less hiring and still having incredibly high-quality workers,” she said.
However, if quiet hiring approaches are not transparent to workers, and framed in a mindful way, business leaders run the risk of the concept backfiring.
One potential downside to quiet hiring exists when it is poorly managed, Gilad Chen, associate dean of research in organizational behavior at the University of Maryland’s Robert H. Smith School of Business, said in an interview with CFO Dive.
“Employees who are sent to new positions may feel their current position is in jeopardy, and it may be threatening to employees,” he said.
However, if managed effectively, this concept could be motivating for employees, and become a part of their job rotation and career development opportunities, he said.
For example, Google uses quiet hiring as a recruitment tool. “You bring in people for temporary positions, but it's almost like a trial period, and that's actually very motivating to those employees,” said Chen.
Workers still have power
Quiet hiring does not take away the fact that there is still a talent shortage, stressed McRae, noting that internal quiet hiring may make it easier for employees to gain promotional opportunities and pay raises.
“This is not an attempt to grab power back from employees, it’s accepting the reality that we're working in here. And part of that reality is that employees have plenty of power and influence if they want it, and can say, ‘hey, we're willing to move over, and make that transition, but what's our compensation change going to be?”
When it comes to external quiet hiring, “you get what you pay for,” Chen said.
Generally speaking, “employees who are working on a temporary basis don't identify with a company and they're not as committed to the company. So they will do the job but nothing beyond the call of duty. Which might be okay, but it might be a problem,” he said.