Survey: Return-to-office is top concern for Northern California employers

If you’re an employer who is agonizing about whether you should be forcing people back to work in the office full time, some new data suggests you may want to hold off doing so — at least for now.

That was among the findings of Sonoma-based employment agency Nelson Connects’ newly released 2023 Salary Guide and Workplace Trends Report.

“Our results showed that only one-quarter of employers now require employees to be going back to (the office) on a full-time basis,” said Joe Madigan, CEO of Nelson Connects.

Given people’s attitude toward work has changed, most employers won’t risk forcing employees or qualified job candidates to work in the office full time.

“Candidates are still turning down work,” Madigan said. “Of the companies we surveyed, 63% said they either lost a candidate, or candidates put them on a back burner in terms of accepting offers with them if the position was not going to be working remotely or offer an opportunity for flexibility.”

Further, more than one-third of survey participants said they had employees resign if they were mandated back to the office.

Clearly, Madigan said, how companies are dealing with the return-to-work issue stood out most in the new survey, which Nelson conducts every year.

During the fourth quarter of 2022, Nelson surveyed 140 hiring managers in California — predominantly in Northern California — across dozens of industries in the public and private sectors, as well as nonprofit organizations.

In the survey, 40% of employers had chosen the hybrid model, 24% required workers back in the office full time, and 12% were letting employees decide where they want to work.

Revenue expectations

Nelson’s survey found 55% of participants expect revenue to grow this year despite inflation, wage pressures, the tight labor market and, for some, workforce realignments and reductions.

“So companies that didn't do (as well as) they wanted to do in 2022, still had year-over-year growth,” Madigan said.

Another 25% of employers reported they expect revenue to remain stable this year, while 6% expect a revenue decline, according to the findings.

The caveat to increased revenue growth is how well employers can recruit and retain employees, he added.

Limited attention to benefits

Madigan expressed concern about one of the findings in the study. Just 34% of employers ask their employees what kind of benefits they want beyond standard health care and PTO.

“What this tells me is there's still a lack of employee engagement,” Madigan said. “I think that's a little discouraging, given that I would have thought we've come a lot further … especially when you’re trying to retain (workers).”

Still, most companies surveyed said they don’t go the extra mile about offering benefits such as increased PTO, leaves of absence, or paid time-off to volunteer, according to the report.

In fact, volunteering has ranked among the top three benefits requested, particularly by millennials, in different surveys Nelson has conducted over the years, said Madigan.

But just 25% of employers in Nelson’s 2023 survey reported offering paid time-off to volunteer.

“And the cost to do that? Nothing,” Madigan said.

Money management

But some things haven’t changed. Compensation and a tight labor market continue to be a pressing issue for employers.

According to the new survey, when it comes to retaining employees, 38% of businesses said they have made counteroffers to employees who have turned in their resignations. However, just 25% of employers who successfully retained an otherwise-departing employee could confirm that person still works for the company. That could suggest a pay increase may help retain employees for the short term, but doesn’t solve other issues driving resignations, the report stated.

When it comes to compensation, 55% of the participants said they offer merit raises, typically between 3% and 4%; while 47% opt to give discretionary bonuses to reward top performers rather than increase pay.

Nelson’s 2023 Salary Guide and Workplace Trends Report also details annual compensation rates for hundreds of positions within a dozen industries in 21 California counties, including Marin, Napa, Sonoma and Solano in the North Bay. The guide also provides national salary trends for major metropolitan markets. Nelson’s report is available for ordering on its website.