Renegotiating Work: Balancing Workplace Demands in Uncertain Times
The nature of work has markedly changed in many industries over the past decade. Since the pandemic-induced disruptions of 2020, when offices emptied and Zoom replaced conference rooms, younger workers have rewritten the rules of workplace arrangements, and firms are still scrambling to adapt.
Now companies are mulling return-to-office mandates with the aim to reinvigorate leadership pipelines and redefine employer-employee loyalty. Meanwhile, worker preferences, technological change, and generational shifts are complicating the picture of what will become the new workplace culture.
In 2026, through our annual Grand Challenge, we will investigate the changing nature of the mutual commitment that once anchored work. We will use three key framing questions to guide this year-long exploration.
What is the future of work arrangements, and how can organizations balance flexibility with performance expectations?
In many jobs, the nature of work is quite different today than it was even a decade ago. Telecommunications technologies have enabled the rise in hybrid and remote work arrangements in recent years, since the COVID-19 pandemic created the need for people to do their jobs while at a physical distance from their coworkers. Now that the pandemic has passed, will we go back to how things used to be? Or are flexible schedules and hybrid work, at least to some extent, here to stay?
It is clear that a large portion of workers value flexible arrangements, both in terms of location (e.g., tech workers are willing to forgo 25% of wages for remote/hybrid arrangements) and in terms of time, as about half of US employees prefer to have greater control over their work schedules, according to a 2024 Gallup survey. These preferences have endowed flexible work with staying power, and today a large number of workers maintain flexible arrangements.
Yet workers aren’t the only ones determining the “where” and “when” of getting work done. For employers, flexibility tends to be a more contentious issue.
Many employers have found advantages in allowing workers greater discretion over their schedules (e.g., by choosing shifts), as this sort of accommodation can boost productivity and employee morale, accruing benefits to employees and employers alike. Such a win-win suggests that flexible schedules will remain, to some extent, a permanent workplace fixture.
On the other hand, location flexibility has some notable disadvantages. Remote workers do not get promoted or recognized as much as their on-site counterparts, and some firms have reinstated in-person work policies to boost productivity. Return-to-office mandates have become more and more common, and many workers are strategically going back to the office to improve their chances of promotions. These trends reveal the tensions between the competing preferences and tradeoffs of hybrid and fluid work arrangements. As workers and employers seek a new equilibrium, the future workplace may resemble the pre-pandemic bargain more than it does now, with a greater emphasis given to workers’ showing up in person than the present moment would suggest.
Throughout the 2026 Grand Challenge, we will convene business leaders and leading academics, including Kenan Institute Distinguished Fellow Nicholas Bloom, William Eberle Professor of Economics at Stanford University, to help us investigate how firms and workers are navigating the fundamental tradeoffs of today’s varied work arrangements and how the decisions made this year will determine the future of work.
What does leadership look like in this new era of work, and how is the next generation of leaders being developed?
Of the new work arrangement’s potential downsides, remote work poses the greatest long-term risk to leadership development. Informal mentoring, observational learning and relationship-building have traditionally happened in shared physical spaces. As more early-career workers operate remotely or on flexible schedules, leadership advancement pathways weaken. Compounding this issue, early-career workers’ increased dissatisfaction with senior leadership suggests a growing disconnect between executives and emerging talent. If young workers have fewer opportunities for mentorship and less trust in leadership, the pipeline for future managers will narrow.
The differences between younger and older employees’ views on what constitutes an optimal work-life balance as well as their career aspirations make finding a work arrangement equilibrium a greater challenge. These are not merely generational differences, as we often hear, but rather age-related ones. Younger workers, regardless of generation, are more likely to job-hop. Older workers, regardless of cohort, tend to value stability. These patterns repeat across time, and this conclusion is echoed outside of academia.
Glassdoor data show that Gen Z’s progression into management roles mirrors that of previous generations at the same age. Today’s young workers are not uniquely impatient or disengaged — they are behaving much like young workers always have. Of course, this does not mean that younger workers today are identical to their predecessors. Data suggest they are more likely to pursue side hustles, reflecting both economic pressures and expanded opportunities in the gig economy. Young people also tend to bring stronger digital and artificial-intelligence-related skills into the workplace — a distinct advantage rather than a cultural rupture.1
Through the 2026 Grand Challenge, we will investigate how firms think about developing the next generation of leaders, given recent changes in workplace arrangements as well as perceived age-related differences among employees in attitudes and skills. We will explore how firms can invest in mentorship, feedback mechanisms and skill exposure now that these qualities may not develop organically. Kenan Institute Distinguished Fellow Michael Christian, professor of organizational behavior, Bell Distinguished Scholar and area chair of organizational behavior at UNC Kenan-Flagler Business School, will bring cutting-edge research to bear to answer questions surrounding leadership development in the new work landscape.
Is work more transactional these days, and is this good or bad for firms?
We have observed an uptick in layoffs over the past five years, especially for small firms, a key trend affecting the connection between workers and employers. The recent swell in worker dismissals reflects the “forever layoff” phenomenon, by which downsizing events occur cyclically, multiple times within a firm. This process leads to less secure and more dissatisfied workers.
Merely the perception of experiencing the “forever layoff” has far-reaching consequences for workplace culture, resulting in a more transactional relationship between firms and employees. This new arrangement has workers hedging their bets by building side incomes and prioritizing flexibility. Employers, in turn, rely more on short-term contracts and project-based work rather than expecting lifetime employees.
What normative judgments can we draw about a more businesslike and less compassionate relationship between firms and workers? Is this new bargain good or bad or mixed? Answers to these questions would seem to depend on perspective. A transactional workplace may boost efficiency and adaptability. Yet it is also likely to weaken worker commitment, erode trust and make it harder for firms to invest in long-term talent development. For employers, a key challenge is how to achieve balance: to remain flexible without becoming disposable and to offer security without sacrificing competitiveness.
During the 2026 Grand Challenge we will explore how firms navigate the new world of work, one characterized by an increasingly transactional employer-employee arrangement. In this new bargain, workers demand flexibility and work-life balance while firms seek hard-earned growth amid fierce competition, technological innovation, changing regulatory environments and shifting consumer and employee demands. Kenan Institute Distinguished Fellow Daniel Zhao, chief economist of Glassdoor, is one industry expert who will help answer these questions.
