What’s the “Vibecession” & How to Help Employees Overcome It

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Posted On Sep 24, 2024

3 Ways to Boost the Vibes & Inspire Retention

By most measures, the U.S. job market’s recovery since the COVID-19 recession has been pretty historic. The unemployment rate has returned to pre-pandemic levels and continues to tick downward. While job growth has slowed a bit in the past year, the numbers are mostly positive. Maybe most significantly, real wages—wages adjusted for cost of living—are higher than before the pandemic and have been outpacing the rate of inflation for over a year now. So why, you may wonder, have we experienced a “vibecession?”

What is a “Vibecession?”

If you simply looked at the data, you’d have to feel pretty optimistic about the U.S. job market, right? Right? Well, it’s more complicated than that. While the numbers may look great on paper, they don’t necessarily carry over to people’s feelings about the job market, wage growth, and the economy as a whole.

Despite a mostly slow and steady recovery, a new economic phenomenon has emerged: the "vibecession." In this “vibecession,” despite mostly positive indicators, many people may still have a pessimistic outlook.

The “vibecession” left its mark all over the Federal Reserve’s latest annual survey of the economic well-being of American households which showed a major gap between how people feel about their personal finances vs. the national economy:

72% said they were “doing OK” financially, down from 75% in 2019
22% rated the national economy “good” or “excellent” down from 50% in 2019

Additionally, in a Harris Poll survey for The Guardian, 49% of people said that they believe that unemployment is at a 50-year high, even though the unemployment rate is actually at a near 50-year low.

Employers Have the Power to Change the “Vibes”

With such a divide between perception and reality—or, more accurately, the data and people’s feelings and real-world experiences—what can be done to help employees feel more positive about their present situation and their future job prospects?

Organizations should know that they have the ability to alter those perceptions and, in doing so, set themselves apart as employers of choice.

The simple solution is: reassure your people by investing in them.

Seize this opportunity to develop your people’s skills and leadership abilities, and create more opportunities for internal mobility and nonlinear career paths. Changing employee attitudes starts by empowering them to achieve greater possibilities and have a positive impact on your organizational vision.

3 Ways for Organizations to Change the ‘Vibes’ by Investing in Employees

At LHH, we recommend three key areas of investment in your current talent:

1. Reassure employees by empowering them to work well with tech

As AI and machine learning continue to automate routine tasks, the majority of today’s employees are willing to embrace technology in their current roles—and, of course, in their next ones. Survey data from our latest Workforce Trends report said:

65% of employees believe digitalization will have a positive impact on their jobs
61% felt the same about automation

Employees are not necessarily concerned about being replaced, but they do want to be reassured. You can do this in the form of skills development.

Put programs in place to develop the skills your employees will need to accelerate your organization’s digital transformation. While tech skills in areas like computer science, data analysis, and data science are crucial, so is identifying employees with critical soft skills and helping them maximize those skills to make moves–linear and nonlinear.

This support benefits both them and the organization. Soft skills critical to digital transformation include:

Adaptability
Creativity/curiosity
Critical thinking
Executive functioning
Emotional intelligence/empathy
Problem-solving
Relationship-building
Storytelling
Verbal and written communication

2. Support your employees through a “Vibecession” with a diverse, inclusive, and versatile culture

Today’s workforces are more future-focused, tech-savvy, and, thanks to remote and hybrid working arrangements, widely dispersed than ever. This makes it more challenging to make everyone seem like they are part of one mission.

However, if your employees feel the organization embraces and values their different backgrounds, experiences, and perspectives, it often translates into increased creativity, productivity, and innovation.

Consider the following approaches for integrating diversity and inclusion into your organizational culture:

Ensure DEI training begins at the highest levels of the organization

Make sure your leaders fully understand the benefits of diversity and inclusion and are given the tools to lead and communicate effectively with diverse teams. When training leaders on DEI best practices, focus on dispelling myths, fostering empathy, and promoting the benefits of working with colleagues with varied backgrounds, skill sets, and ways of thinking.

Instill inclusivity and equity in your hiring practices

Identifying and rooting out any inherent biases in your talent acquisition process is key to helping your company better attract and hire top diverse talent.

Take steps like using AI for blind resume screening and training your hiring managers to effectively interact with candidates of various backgrounds.

Standardize interview questions and processes to reduce bias. Establish clear metrics and accountability goals to measure your efforts and ensure transparency.

Then, once candidates become employees, incorporate DEI training into your onboarding and employee development programs to improve your retention efforts.

Upskill, upskill, upskill

We talk a lot about upskilling here at LHH, but it really is critical to success across all areas of your organization. Offering upskilling and nonlinear advancement opportunities gives individuals from a variety of backgrounds access to new roles unavailable in a traditional hierarchy.

It also allows your organization to tap into unique talents and skill sets that may have previously gone unnoticed. Additionally, investing in mentorship programs or support groups is another way to discover and nurture diverse talent in all areas of your company.

3. Develop empathetic leaders to inspire your talent

Even the most well-conceived talent strategies need dynamic, adaptable, and emotionally intelligent leaders to realize the vision by energizing and inspiring their teams.

In fact, workers are counting on it. Half (50%) of employees told us they are relying on their employers and managers to help them understand and prepare for the changing natures of their jobs.

What skills do leaders need to possess and develop to make this happen? First and foremost, today’s leaders absolutely must be able to conduct consistent and compassionate career conversations, and better relate to their employees.

The reassurance employees crave during this ‘Vibecession’ can be provided through regular, empathetic yet candid conversations. Managers should discuss skills they need to improve, learn, and transfer to new roles, and how their adaptability is appreciated and essential to achieving the organization’s vision.

One way to change any negative employee perceptions is to reassure them that, in the age of digital transformation, their skills are transferable to new roles and responsibilities.

Use the “Vibecession” to Address Opportunities in Employer Brand, Company Culture, & Employee Satisfaction

Admittedly, “vibes” are quite a vague measure of employee engagement, but there is no doubt that something is off. Despite the mostly positive job market indicators, it would be inaccurate to say we all didn’t feel at least some effects of this “vibecession.”

However, employers have the power to swing the vibes back to the positive side of the spectrum. By investing in skills and leadership development, creating more internal opportunities, and building a more diverse and versatile workforce, there are opportunities in this and any job market to change the vibes and become an employer of choice.

Want more workforce insights and data? Download our 2025 Salary Guide featuring the most up-to-date salary figures sourced in partnership with Salary.com. The 2025 Salary Guide is designed to help you better understand the value of leading professionals in your field, so you can develop stronger, more holistic talent acquisition and retention strategies.