Mercer CEO: The need for talent is still there

Yahoo Finance’s Julie Hyman and Brian Sozzi sit down with Mercer CEO, Martine Ferland, at the 2023 World Economic Forum in Davos, Switzerland as they discuss the future of work, mental health support in the workplace, and talent needs.

Video Transcript

JULIE HYMAN: Among the big topics covered in Davos is the future of work. Of course, that's something that we're talking about a lot in the US as well. Should we be hybrid? Should we be all in the office? All remote? Mental health is a big part of the picture too. Let's bring in Martine Ferland. She is CEO of Mercer, the biggest HR consultancy. So obviously a good person to talk about all of these issues. Martine, thank you for being here.

MARTINE FERLAND: My pleasure.

JULIE HYMAN: Let's start with hybrid, remote versus in the office. What are you hearing from people as to what makes the most sense right now? And people I'm chatting with, there really doesn't seem to be any consensus on this.

MARTINE FERLAND: No, I think we're still living the grand experiment of hybrid. There's probably a consensus that hybrid makes sense in the whole because it gives you the opportunity to do both, deep work in a setting that is quiet at home, reducing your commute, being closer to your family or whatever it is that's in your community that is of importance to you, but at the same time blending in the being together, and then intentionally working together, whether it's surreptitious meetings that spark an idea or onboarding newcomers, just creating team spirit.

But how do we exactly do that? No, we have not cracked that nut. But we have to crack it. I think it's a good blend. And, honestly, I don't think we're going to the normal that was pre-pandemic ever. That's gone forever. So we need to find the new way of working.

BRIAN SOZZI: And what's the impact of businesses from this what might be, to your point, might be a future of hybrid work.

MARTINE FERLAND: Yeah. Well, what we're hearing right now is pretty much most office working environments the leaders are OK with this blend of two, three days in office and two, three days at home or at clients or a blend of. And we know it's in the early days of trying to establish a new cadence. And, therefore, what we're hearing is a lot of leaders setting policies, setting expectations, setting a culture around how they want us to work together at the same time as not mandating, just not right now at least, not policing it on an everyday basis because we're still living quite through a labor shortage, a skills shortage. They know it'll backfire. And, therefore, I think people are just taking their time and adapting and coming to a lending place together.

BRIAN SOZZI: Is worker burnout still top of mind when you talk to executives?

MARTINE FERLAND: Not as much as the HR community would want to believe. So what is it? Is it the HR community being more connected and the C-suite being less connected? Definitely more demand for mental health support from employees. So that could tell you there is some discomfort or some need to-- I think it's this adaptability, this new world we live in, trying to find your boundaries, your anchors, and people needing help through that to a point.

BRIAN SOZZI: Be right back. I have to go check a Slack message. I'll be right back. No, I'm kidding. Just kidding. Just kidding.

JULIE HYMAN: This is something we've been talking about with different guests as well. When it comes from mental health perspective, what is the single most important service, say, that an employer can provide when it comes to mental health that's going to make a real difference?

MARTINE FERLAND: Yeah. Well, I think in a way providing some purpose, making sure you have the strategy, the vision for the collective that is a business. A business is a collective. We're working together towards something. We're delivering something to the outside world. And, therefore, making sure that there's good alignment, good comprehension. So clear communication, open communication, two-ways communication, hearing what your employee base is not understanding or understanding of the vision, what they have to say about it, how they can contribute because I think one of the key here for mental health-- and I'm not saying-- I mean, there's deep mental health issues.

And I'm absolutely not an expert in this. But in the everyday burnout, everyday disconnect or disengagement that we see, I think that just making sure that you do that psychological connection to people. Why are you here? And creating an intersection between the big collective purpose-- at Mercer, we want to make a difference in people's lives. We do it through our expertise in HR programs.

So better retirement funds, better health coverage, all these kinds of things. But within this collective, I have different-- I might have a slightly different purpose, aspiration, ambition for my own career in life. So how do we connect the two? How do we make sure that we set goals together and that you feel you're progressing towards your goal? That's very important to get a sense of fulfillment and being satisfied with your work life.

BRIAN SOZZI: The buzz board here at the World Economic Forum, at least this year, is recession. It's top of mind with everyone. Do you feel-- do you think as though we are on the precipice of mass layoff announcements for more companies just outside of the investment banking field?

MARTINE FERLAND: And technology.

BRIAN SOZZI: And technology.

MARTINE FERLAND: The crystal ball of recession, when it comes, what shape it takes, and how long it will be, how deep it will be-- I do remember the early days of the pandemic and all the W and the V's and whatever. So this is all quite speculative. What I can see from my own vantage point-- but, remember, we're expert in HR consulting. And the talent agenda is still very elevated, doing good through having the right people, succeeding through having thriving employee base is important. So that's staying at the top of the agenda. So for us, right now, there's kind of two dimensions. You have to hold two thoughts.

JULIE HYMAN: So in other words, are you saying workers are still hard to find?

MARTINE FERLAND: Yes. Yes.

BRIAN SOZZI: But other companies over hired.

MARTINE FERLAND: Some. In some places. And interestingly enough, the technology companies that have over hired, there are a lot of companies that are not tech companies that need tech workers. So it'll be interesting to see how this washes out. The demographics are that populations is in decline. Working population. We've seen baby boomers retiring earlier during the pandemic.

And, therefore, the need for skills, the need for talent is still there. It's quite a conundrum to see some companies laying off and some companies continuing to hire, sometimes the same companies. It's just different skill set that they need. So that's quite difficult to comprehend. So I think we've been toggling with the two sides of this at the same time, trying to be prudent in our spend at the same time as we do need the people to deliver the service and not be a self-fulfilling prophecy.

JULIE HYMAN: Are you seeing any pullback in demand for your services right now?

MARTINE FERLAND: Not for now. And that's the point about the people agenda being quite elevated, wage inflation creating labor tensions, skills upskilling, transformation of the way that we work, technology, embedding technology. All of these strands were there pre-pandemic. But they've been super accelerated through the pandemic. And, therefore, actually, as one of the lever against a recession continuing to transform, continuing to embed digital working automation within the workforce, reskilling the people so that they can adapt to these new ways of working. It's all very high up on the agenda of employers.

JULIE HYMAN: So just finally a quick point-- so that sounds like that is sort of a secular big picture change that will keep going even if there is a recession.

MARTINE FERLAND: Well, it depends on how deep and how long it is, of course. How much do you need to batten the hatches? Just a little bit or just fully down? I think ultimately, of course, people is high cost on companies P&L. And, therefore, we may ultimately get there. But right now, we're not seeing the signs of this in most industries. But there have been some exceptions.

JULIE HYMAN: Very interesting. Thank you so much, Martine. Martine Ferland, CEO of Mercer.

MARTINE FERLAND: Well, thank you for having me, Julie and Brian.

BRIAN SOZZI: Appreciate it.