‘Quiet hiring’ gives a new name to an old workplace strategy

Keeping up with the proliferation of buzzwords that try to capture post-pandemic employment realities is a real challenge for everyone right now. Into this swirl entered “quiet hiring.”

According to the Society for Human Resource Management, quiet hiring is “when employers fill talent gaps by shifting employees around and hiring contractors or part-time workers.” In many ways, this is a new label for old phenomena in a tight labor market with an uncertain economic outlook.

This approach to filling vacancies has long been a strategy for some organizations, such as those in fields demanding rapid change or that perhaps can’t afford to compete for the same talent pool elsewhere. Whether quiet hiring is a short-term or long-term solution, there are potential opportunities and pitfalls for employers and workers alike.

When quiet hiring is a strategic (and not a desperate) decision, you will likely see firms invest in cross-training and develop formal or informal mentoring programs and other internal development strategies. These employers likely have made a strategic decision to invest in the skills of their people so they are ready to move into new opportunities, with new skillsets, to move the company forward. Alternatively, or additionally, these organizations may create networks to allow for speedy access to outsourced workers with specialized skillsets.

When done with intention, a company could realize clear strategic advantages by having a ready pool of qualified and flexible employees. Employers could also reimagine the assignment of “work” by focusing on the skills and competencies needed, rather than the person or job needed. These organizations are then positioned to redeploy work arrangements internally and externally — and, if it all goes well, move everyone involved toward a “win-win” situation.

Realistically, quiet hiring brings both companies and workers a mixed bag of pros and cons. For instance, employees could enjoy new challenges through the applications of their current skills, raise their profile by getting more exposure across their company and deepen or expand their skillsets with additional professional development opportunities.

There are some clear risks, however. For example, individual “jobs” could become unmanageable if people are asked to use their skills in new areas without relinquishing any of the responsibilities in their current positions. In addition, individuals might get moved from positions with tasks and people they enjoy to places where they don’t. If left unaddressed, then the organization has planted the seeds of employee dissatisfaction and potential increased turnover.

Some experts have put quiet hiring into conversation with “quiet quitting” (the “do only what is required” trend). The suggestion here is that individuals advocating for more employee autonomy and reasonable work-life balance — the supposed ethos of quiet quitting ethos — end up in unwitting competition with those who are “quietly hired.” This can cause friction and a power struggle between employees to the possible detriment of the employer, as well as to the long-term disservice of labor more generally.

When the employer moves a person from one job to another, it still has an organizational hole to backfill; it’s just in a different job. However, the employer may see this as an opportunity to fill hard-to-hire positions internally while simultaneously hiring for easier-to-fill jobs through the open labor market. Also, the use of outsourced services could cut costs and increase short-term flexibility. In these scenarios, the employer may enjoy a short-term win while the employees may not.

The quiet hiring phenomenon is likely to persist through the foreseeable future for several reasons.

First, we’ll likely keep hearing about layoffs as we see a continuing employment correction from overhiring during the overheated post-pandemic economy. Notably, these are relatively minor “corrections” and somewhat industry-specific. In fact, unemployment is at historically low rates right now, and employers need to retain their most valued employees because replacement costs for finding labor will continue to be onerous.

Second, everyone is keeping an eye on inflation. If inflation continues to slowly decline, as some indications suggest, then employers will have more confidence in investing in their labor pool. This dynamic will likely manifest first as internal investments in the workforce before expanding extensively into new jobs. Employers will probably try to manage their business with the staff they have because they either cannot find replacements or are leery of expanding the payroll.

Lastly, the Baby Boomers are finally retiring — for real this time. This demographic change means that going forward, there will be many fewer workers available and a smaller pool of people with high-demand skills. Put simply: Employers will have to figure out how to get work done with the workforce they have as outside talent becomes more competitive and costly.

If you put this all together, we are likely entering a new era wherein the current power balance between employer and employee will be renegotiated, and we cannot yet predict what will result. If you’re on either side of this dynamic, as a worker or employer (or both), make sure to pay attention.