Credit managers return to the office

Four years after the start of the pandemic, many credit managers still work from home. But a growing number are back in the office five days a week.

Why it matters: Understanding these labor market shifts and trends is key for credit professionals as it directly impacts their work environment, job security and workload management. Credit managers must remain aware of these pressures as workforce trends continue to change in 2024.

By the numbers: A recent eNews poll revealed 32% of credit professionals said managing an increased workload was their biggest challenge. Other labor-related challenges include:

• Hiring and retaining skilled credit managers (14%).
• Understaffing due to layoffs and reduced team size (14%).
• Maintaining team morale amid the fear of potential layoffs (7%).
• Managing layoffs without affecting credit management operations (4%).

Another eNews poll revealed that 35% of credit managers work in the office five days each week, while:

• 21% are in the office three out of five days; and
• 13% are fully remote.

What labor experts are saying: “What we’re seeing is some softening in the market, and the last few years post-COVID were more of a candidate market where they had a lot more of the leverage,” said Chris Myers, president and CEO of Professional Alternatives (Houston, TX). “But power is starting to shift back towards the employer now. With more layoffs happening nationally than what we’ve seen in a while, the expectation on our end is that the market will soften a bit but not substantially. It won’t be a full-scale recession to where jobs will be shed in high quantity—but it’s definitely shifting back towards where the companies have a bit more control than what they’ve had in the past.”

What’s next for labor trends in 2024:

We’re heading back to the office. Return-to-office mandates started to increase in the last two quarters of 2023. However, feelings about returning to the office are mixed. Tangible costs, such as gas, add up. The intangible cost of time wasted in hours of commuting also creates an argument against in-office work.

“Most recruiting managers or third-party agencies have mentioned how much the talent pool opens the second you mention working from home,” said Jake Merriman, credit manager at Masons Supply Company (Ridgefield, WA). “75% of the time, the main question from applicants is if the position is remote and, if not, it’s one of the main reasons they won’t want to join—especially with the younger generation, we’re seeing that it’s not an option but a necessity.”

Although fully remote roles are less common, hybrid schedules seem to be a winner in the workplace. As of 2023, 12.7% of employees work from home full-time, while 28.2% work a hybrid model, per a report from Forbes. When employees had more leverage during the peak of the pandemic, most employers did not have much of an option to fight for coming in even in a hybrid environment.

Kimberly Darling, senior credit analyst at OrePac Holding Company (Wilsonville, OR) said her company uses a hybrid work model. “My company recently announced that we’re going back into the office three days a week instead of two,” Darling said. “Most of us think there are less distractions when we’re at home. When we are in the office, you can see our email volume drop considerably because people like to stop to chat and interact with each other. It’s very likely that you’ll lose that focus when going into the office more days.”

AI is here to stay. AI has fundamentally transformed the labor market, reshaping the nature of work and employment dynamics. While these advancements have brought increased efficiency and productivity, they have also raised concerns about job displacement and the future of work. Roles that involve repetitive tasks or routine information processing are increasingly being automated, leading to a shift in the skills demanded by employers. However, AI has also created new opportunities. Credit managers can use AI to help make more confident credit decisions.

Employees want more to stay put. Credit managers must find more creative ways to keep staff. This starts with being upfront about job responsibilities so that candidates know what to expect—especially as credit managers oversee more tasks.

“In previous instances of staffing challenges, our team addressed increased workloads by redistributing job duties among team members,” said Jonathan Chandler, CBA, CICP, senior credit analyst at Wonderful Pistachios Almonds (Bakersfield, CA). “The goal of the redistributing of responsibilities should be equity. This approach fostered a collaborative environment and provided opportunities to gain valuable insights into various roles, such as accounts payable, customer services, accounts receivable and credit. Embracing additional responsibilities across different units has been instrumental in enhancing efficiency and effectiveness.”

Employers must also find efficient ways to appeal to their potential candidates in 2024. Pay increases are now more difficult to provide as a benefit, but some employees value benefit packages outside of monetary compensation. Only 11% of employees in the workplace are satisfied with their current benefits. Tiger Recruitment data shows more than half of U.S. professionals (56%) would like to see their benefits adapted to the rising cost of living, while 30% want more personalized benefits.

The bottom line: During any workforce changes or adjustments, credit professionals should always focus on skill diversification and stay informed about the latest industry trends. Labor trends are ever-changing—making the ability to adapt an inherent skill.