Will remote workers be laid off first when recession hits?

Majority of American managers believe so

Will remote workers be laid off first when recession hits?

Remote employees should start updating their resume ahead of the anticipated recession.

More than half (60%) of American managers believe that remote workers will be laid off first if downsizing becomes necessary should the recession come, according to a report from Beautiful.ai, a software company.

Employees of a hybrid-remote situation might be more at risk than those working for a fully-remote team, according to the report based on a survey of 3,000 American adults in management positions.

Read more: Are remote jobs more at risk in a recession?

“Workplace proximity bias could prove to be a troubling issue that managers deal with during this current economic uncertainty,” said Jason Lapp, Beautiful.ai’s chief executive.

“Prejudice against remote workers is obviously not a manager’s intention,” he said, “but sometimes it’s difficult to imagine fair treatment and trust when a batch of employees are working next to you in an office and another group of employees are working at home.”

Less than a quarter (20%) of managers are on the fence regarding this issue while another 20% believe this is very unlikely. Meanwhile, eight in 10 workers feel working from home would make them more vulnerable in a layoff, reported GoodHire, an employment screening firm in Redwood City, Calif.

A previous report by San Francisco-based Magnit found that nearly 90% of employees prefer a role with remote options. This means that employers that offer such flexibility will capture 96% of the labor market while those that don’t will lose out on 58% of candidates.

Despite the view on the fortunes of remote workers, 70% of managers believe a digital workplace is more recession-proof than a business with all of its employees in the office, according to Beautiful.ai. Meanwhile, 22% disagree and 9% are unsure.

Overall, 80% are worried about a recession negatively impacting their business. A huge majority (81%) of managers also say they are excited about digital workplaces replacing full-time in-office arrangements.

Read more: Recession fears: Job openings see biggest decline since April 2020

With a recession looming, the labor market may finally be cooling off, according to the U.S Labor Department. In August, the number of job openings decreased to 10.1 million from 11.2 million in July, according to the Job Openings and Labor Turnover Survey (JOLTS). It’s the biggest decline in job vacancies since the height of the COVID-19 pandemic in April 2020. That now means there are roughly 1.7 jobs available for every unemployed person. Health care, social assistance and retail trade were the top industries to experience decreases in job openings.

Also, only 35% of companies feel "very prepared" for a recession. Nearly half (47%) are "somewhat prepared," 15% are "only a little prepared," and three percent are "not prepared at all."

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