Leading talent expert Amy Schultz warns that ‘job huggers’ are masking burnout in the workforce and it may be stifling growth for startups and small businesses.

Research shows thousands of employees choosing to stay put in their roles for longer in pursuit of work stability. Job hugging is a phenomenon showing up in studies across the country. However, while the decision to stay put may be well-intentioned, perhaps even a necessary one for some, for many small businesses job huggers could be a direct threat to your bottom line.

“There’s so much instability in the economy at a geopolitical level,” explains Amy Schultz, a leading talent expert who has shaped teams at global giants like Canva and LinkedIn and more recently at HR consultancy Korn Ferry. “So people are staying, but that doesn’t mean that they’re engaged. They just don’t want to move”.

We are experiencing a time of peak risk-aversion when it comes to career movements, with employees quitting less often than at any non-pandemic time since 2018. This trend is partially driven by job security anxiety, with the recent Employment Hero Annual Jobs Report finding that fifty seven per cent of Australian workers now prioritise security over ambition. Forty five per cent surveyed also said they doubt they could find a new job within three months, as competition for roles hits its highest level since early 2021.

This creates a workforce of employees who are present but not productive, says Schultz, staying in their roles out of fear rather than fulfillment. She believes this epidemic of disengagement has a clear root cause, and a powerful, human-centric cure.

A Workforce Under Pressure and the Missing Middle 

To understand why so many employees are mentally checking out, you only need to look at the pressures they face outside of work. 

Amid a global cost-of-living crisis, one in three workers now holds more than one job just to earn enough. Fifty six per cent of employees surveyed in the Jobs Report now say they want a role “without too much pressure and responsibility,” a clear signal of a culture of burnout.

It makes sense that when employees feel trapped by economic necessity and anxious about the future, they cling to the stability of their current job. But this security comes at a cost to their passion, drive, and engagement

“You’ve got people staying in the workforce longer, more people clinging to certain roles, and then you’ve got Gen Z not wanting to take a leadership role because they’ve been observing the stress of their leaders and not wanting to take that on,” says Schultz.

While external pressures set the stage for job hugging, Schultz points to another critical structural shift happening. “Around forty one per cent of organisations this year have cut a level of management. So we’ve also got this missing middle layer of managers.”

While effective cost saving, this has had a devastating side-effect. “People potentially now don’t have a manager, or they’re reporting into someone who has 20 direct reports,” Schultz observes. “They’re not getting the direction or the coaching or the feedback that they need”.

The same research identifies a trusted manager as the number one reason employees stay in their jobs. When that connection is severed, the primary channel for engagement, motivation, and clarity is lost.

For Schultz, this managerial gap is, at its core, a communication issue. “As a people manager, nine times out of 10 if something gets escalated to me, it’s a breakdown in communication,” she states. “We either didn’t communicate, or we didn’t set expectations correctly”.

This breakdown has tangible consequences, especially in SMEs where 56 per cent of businesses rely on overtime when understaffed. Without a strong manager to set clear expectations, provide support, and move people on to new roles when they’ve stalled, teams become disconnected and disengaged, leading directly to the job hugging phenomenon.

“That disconnect and sense of apathy will only keep getting bigger,” Schultz warns, “and that’s not good for anyone”.

The Leadership Cure for a Cautious Workforce

In an environment of constant change, how can leaders combat this growing apathy and re-engage a workforce that’s clinging to stability? Schultz’s prescription is both simple and powerful, “When so much is changing in the world, leaders feel, probably at times, a bit frozen because they want to communicate but they don’t know what to communicate,” she says.

The temptation is to wait for perfect certainty, but that’s a losing strategy. The antidote is radical transparency. “I think once upon a time, as a leader or a manager, we felt like we had to know it all. Now I think it’s okay not to have all the answers, but it is your responsibility to find them,” she says.

“How we connect, even in a virtual hybrid situation, is so important. Connection comes when there’s regular communication and that communication comes with clarity.”She also speaks to the importance of providing clear career paths, fair compensation and dependable support to keep talent engaged. “Knowing there is a future, even during tough times, gives employees a reason to invest themselves in their work.”

How to Re-engage a ‘Job Hugger’

In a climate of economic uncertainty, many employees are “job hugging” out of a need for security rather than a sense of fulfilment. Talent expert Amy Schultz from Korn Ferry explains that while these team members are present, they are not necessarily productive. Here are three ways to re-engage a cautious workforce with fresh insights from Schultz.

1. Communicate the ‘Now’, Acknowledge the ‘Next’

Leaders often hesitate to communicate during periods of change. Schultz advises providing clarity in the moment, even if the future is uncertain. Tell your team: “This is what it is today, and hey this could look different in a month six months time and if this needs to change we will let you know”.

2. Increase the Feedback Cycle

When employees feel disconnected, their motivation wanes. To counteract this, Schultz urges leaders to be more proactive with feedback and coaching. “Leaders will have to continue to really up that cycle of feedback and communication. Because otherwise that disconnect and sense of apathy will only keep getting bigger”.

3. Invest in Future-Proofing Skills

Give your team a reason to feel secure in their long-term growth, not just their current role. Schultz believes the key is adaptability: “Continue to be curious, invest in our own learning agility – that’s probably your best shot at future proofing your ability to stay relevant and impactful over the next few years”.