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Glossary: HR & Recruiting Definitions

What is downshifting?

Downshifting refers to the voluntary, strategic career move to purposefully slow or scale down one’s professional advancement by reducing their workload and working hours with the goal of improving their work-life balance. This involves consciously accepting a salary reduction.

Downshifting can be a better alternative to resignation and is steadily gaining popularity among both professionals and managers of all ages.

Why do employees choose downshifting?

The reasons why employees decide on downshifting as a career move vary and are independent of age. However, three reasons are heard particularly often: 

Downshifting as early retirement

Many older employees use this option as a kind of early retirement. Older downshifters usually change their full-time job into a part-time one because their values have changed.

Their time of trying to climb the career ladder, as they did in their younger years, is behind them. Instead, they may prefer to devote more time to their hobbies, their health, or their families and grandchildren without having to give up their regular income entirely.

In the past, a pension without deductions was guaranteed from the age of 65. Today, this is at best a nice dream for future retirees. Generations X, Y, and Z in particular may have to manage without one, which will likely make downshifting an even more popular early retirement option in the future.

Downshifting as an emergency brake (for overworking or burnout)

Downshifting certainly isn’t just for soon-to-be retirees. Young employees, too, are deciding with increasing frequency to shift down a gear at work.

Often, the younger downshifters are specialists and managers who are dissatisfied and/or stressed with their professional situation. This often goes hand in hand with overworking and being on the verge of burnout. The higher the position on the career ladder, the greater the pressure and stress on the shoulders of those affected.

In this case, downshifting is used to make a professional situation that is no longer bearable bearable again. It can help minimise health risks and improve overall health, which in turn helps the employee emerge stronger from such a crisis without necessarily having to change employers.

Downshifting as a family-friendly solution

Similarly, family planning is a common reason among younger employees and a good argument for downshifting, as it makes family and work more compatible. Managing a family is often practically a full-time job on its own, which requires excellent time management and budget management skills as well. However, quitting their job and giving up their entire income is not an option these days.

This double burden of having a child and a job can quickly push parents to reach their limits. Reducing working hours enables young downshifters to manage their family plans much better.

Benefits of downshifting

With downshifting, both the working hours and the working days per week can be reduced. Overall, this step offers attractive advantages for both employers and employees:

Benefits for employers:

If companies show empathy and understanding for the situation of their employees, and the will to support them through downshifting, it shows they care for and value their employees. This increases the likelihood that the employee will stay with the company in the long term because they feel appreciated and recognised. As a result, vacancies that have to be filled at high costs are less likely to open up (= lower employee turnover).

  • Higher productivity

When there are simply too many tasks team members can get overwhelmed, which often results in overwork and burnout. Employees who hand over tasks and responsibilities, on the other hand, experience a lighter workload and feel less stressed. They can act more freely and manage their time better, even with reduced hours. This, in turn, increases the productivity of the downshifter.

  • Preventing longer downtime

Those suffering from chronic overwork (and perhaps even burnout) are much more susceptible to additional health problems. As a result, they may be absent for several months or even years, which means the role will have to be replaced. Downshifting can be a useful measure to prevent such long-term absences and it is a much cheaper option than recruiting new talent.

  • Fewer sick days

Less work usually also means less stress, better emotional stability, and overall higher satisfaction. This also pays off in terms of health, which is why downshifters are usually sick less often.

Benefits for employees:

  • Better health

As mentioned above, downshifting is often a kind of emergency brake to avert serious health consequences. The reduction in workload alone helps employees recharge and restore. Furthermore, many downshifters also use the extra time to adopt a healthier lifestyle to avoid such situations in the future.

For example, if the daily working time is reduced by downshifting from eight to six hours the team member concerned regains valuable time. This extra spare time during the day ensures a better balance between work and leisure.

  • More satisfaction due to improved quality of life

Often family, friends, and hobbies are somewhat neglected because of work. This lack of quality time can be frustrating and reduce someone’s quality of life. Those who have more time for the enjoyable things in life and for self-care increase their quality of life and live more contentedly overall.

  • Income remains

Although not the full income, the employee - unlike when leaving a job - at least has a choice as to how much pay they can or want to do without. If a fair salary is negotiated, the downshifter can successfully make a living without too many restrictions and without being threatened by poverty, which would cause more stress.

Alternatives to downshifting

So basically, downshifting aims to improve the work-life balance. However, there are other options aside from downshifting that achieve a similar effect but make changing employers or reducing hours and income unnecessary:

  • Remote work and home office

Saving oneself the journey to and from the office gives employees valuable time back. Especially for commuters, who often suffer from long journeys (>40 minutes/25 km one-way), remote work and working from home is often a more effective option.

  • Flexible working hours and flexitime

The possibility to arrange working hours oneself can also significantly improve the work-life balance of employees. This still leaves time for doctor's appointments, picking up children, etc.

  • Internal transfer

Perhaps the downshifting plans fit a similar vacant position in the company that involves less responsibility and stress. This might be more in line with the personnel development plans of both parties.

However, the problem cannot always be solved with the help of these alternatives. Whether they are suitable must always be decided on a case-by-case basis. Also, these alternative proposals should be introduced with caution, as they can be interpreted as a negative reaction to employees.

Possible stumbling blocks for employees

Whoever says A must also say B. And indeed, the concept of downshifting also offers a few potential stumbling blocks for employees, which is why taking this step should really be well thought through.

Regardless of whether alternatives are discussed or not, companies should be able to advise and support their employees in the search for a joint solution. This includes informing them about these potential stumbling blocks:

  • Reversing their decision is not possible

Downshifters should be aware that handing over responsibilities in the company is usually a final step. If the downshifting serves to prevent burnout, for example, the employee will rarely get the same amount of work back the way it used to be, even when they decide they want to return to working full-time again.

  • Lower standard of living

The reduction in salary can also have a negative impact on the quality of life as their standard of living will reduce. The impact of downshifting should therefore be carefully calculated in advance. At this point, it may be worthwhile to point out the alternatives above as well.

  • Lack of understanding from future employers

If the downshifter decides to leave the company at a later stage, it may be difficult to explain downshifting in the CV to other employers.

It is important that companies show potential downshifters a desire to keep them in the organisation, that they prioritise their well-being, and that they act in a solution-oriented way. This is because employees may misinterpret these points as leverage against downshifting.

Downshifting as a benefit?

Another attractive option may be to proactively offer downshifting as an employee benefit. Employee benefits that promote work-life balance, e.g. sabbaticals, paternity leave, unlimited holidays, etc., are generally in high demand with employees. 

And since research has shown that the human brain can only concentrate for a maximum of 4-6 hours a day, employees are even increasingly demanding solutions such as the 6-hour working day or the 4-day week with the same salary.

Openness and willingness to grant such a benefit without employees having to ask for it themselves can have a very positive impact on a company's image and be useful in strengthening its employer branding

Companies that already offer the reduced hours or 4-day workweeks as a company-wide working time model (this includes companies like Shopify and Microsoft) enjoy great popularity and also gain strong advantages in terms of their talent acquisition.

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