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COVID-19 Reset & Recovery: Using Human Capital Analytics to Understand the Internal Customer before, during, and after a Crisis

Times of high stress, such as the COVID-19 pandemic, create a sense of urgency to make decisions and increase the risk of acting without fully considering the consequences. Data and information have always been critical in the decision-making process, and this is even more true in today’s circumstances: leaders need to be able to draw insights from reliable data to make effective decisions. During the COVID-19 pandemic, critical decisions have focused on human capital deployment, including how to:

  • Reduce staff size;
  • Increase staff size;
  • Keep employees safe from COVID-19;
  • Get technology to people working from home as appropriate;
  • Counsel employees in emotional distress;
  • Optimize productivity;
  • Get products made and delivered to customers; and
  • Pivot the business model and associated human capital needs to stay relevant.

In the absence of reliable data, decision-making processes will be compromised. Given that many of the decisions made will impact employees and employee programs, human capital teams must be strategic in gathering and analyzing data to inform decisions. Organizations that have base-line performance data from before COVID-19 may be positioned to better understand whether decisions made during and post-COVID-19 are achieving desired human capital performance and ultimately business outcomes. Even if base-line data has not yet been created, it is not too late to curate data from past performance so that you can “path-correct” going forward.

This report will describe three areas of human capital where the use of data is critical in decision-making, particularly during the pandemic: employee engagement and productivity, health and well-being, and diversity & inclusion (D&I). Each section will describe how the pandemic has changed how we collect data and what data we collect, and the potential long-term effects that will remain in place after the pandemic.

Employee experience and productivity have changed during COVID-19 and are likely to continue to change

The COVID-19 pandemic paints a mixed picture of employee engagement and productivity measurement. Some organizations have found employees to be more engaged and productive during the pandemic, citing renewed organizational or job purpose and improvements due to flexible schedules and working from home. Storytelling about some of these changes has been common. In fact, some companies, like Walmart, have developed commercials and marketing campaigns highlighting their employees and the important work they do, telling their stories both inside and outside the organization.

Other organizations, though, have been impacted by the pandemic in less positive ways. Blurred lines between work and life have affected engagement levels and raised the risk of burnout.[1] In addition, job loss, furloughs, nonrenewal of contract work agreements, pay cuts, bonus reductions, and other cost-reducing actions have led to financial concerns for many and “survivors’ guilt” for workers who remain in an organization when their colleagues have been laid off. These actions come on top of health and safety concerns associated with COVID-19 and the illness and death of colleagues and loved ones. These experiences can influence engagement and productivity in negative ways.

This report outlines specific recommendations to help organizations navigate engagement and productivity metrics during and after COVID-19.

Engagement and productivity in a remote environment should be tracked to improve performance. More flexible work arrangements, including more working from home, are likely to become the norm. In fact, a recent survey by The Conference Board found that 77 percent of employers expect more employees to work from home one year after the pandemic.[2] As workers remain remote or in flexible work arrangements, productivity can be measured and new tools and resources provided to improve engagement and productivity in these changing circumstances. Some analytics tools have measured the shift in productivity per worker since the COVID-19 pandemic began and many employees began remote work. The pandemic has given us a unique opportunity to analyze networks and patterns in new ways. For example, according to one study, after two months of social distancing, for employees working from home, these aspects of work have increased:[3]

  • Total meetings by 23 percent
  • After-hours emails by 23 percent
  • Workday length by 34 percent
  • Work interruptions by 34 percent

It seems that many employees have been able to increase their capacity to work and produce measurable outcomes. However, organizations must consider whether these increases in activity are generating higher levels of productivity, and if so, whether these increases are sustainable over time or just a response to the immediate needs associated with the pandemic. Organizations should consider appropriate, sustainable levels of individual and organizational productivity that will generate appropriate outcomes without causing negative impacts on employees, such as absenteeism, disengagement, and resignations.

Use pre-COVID-19 data to compare outcomes and strengthen practices that work. Many organizations today are comparing pre-COVID-19 effectiveness to current levels of productivity. While some organizations have self-reported an increase in productivity since the beginning of COVID-19, others are experiencing a decrease. Organizations that had more remote workers before the pandemic were more likely to report an increase in productivity.[4]

Measures such as the value of revenue per employee or ROI and their correlations to overall targets during and after the crisis can be used to optimize salary dollars without eroding productivity and to reset targets during and after the crisis.[5] For example, one mid-sized regional bank used analytics and financial modeling to determine appropriate pay increases for hourly employees during COVID-19. It determined that a 100 percent pay increase for employees only resulted in a 33 percent increase in actual cost. This was the most financially beneficial decision for the bank when factors such as potential loss in productivity, rehiring, and training costs were taken into account.

While many organizations are focused on short-term engagement and keeping the business running, the data collected now can also inform work-from-home policies and other engagement actions in the future. For example, Gallup has conducted a leadership audit for its clients to inform workforce decisions during the pandemic, focusing on topics like leadership communications and social distancing practices.[6] However, caution should be taken in interpreting results the during crisis and applying them to future conditions, which may be drastically different.

Use demographic data to provide resources to specific worker segments. On an individual basis, organizations can survey employees to map out needs to specific population segments. For example, one survey found that younger workers (44 years and younger), females, and those who lived alone or with roommates were more likely to experience a decrease in productivity. Organizations can support these workers by providing more frequent social interaction, providing flexible work hours, and offering frequent manager updates. [7] Organizations that track this information are better able to meet the needs of different worker segments.

Consider developing (or hiring) leaders with new competencies to motivate remote workers. Remote and flexible work, and increases in new ways of working, such as contingent work or project-based work, may become more prevalent, also requiring new skills of workers and leaders. In addition, new job opportunities may appear as companies move toward more digitized, resilient, and localized operations. In fact, the pandemic may bring about an increased investment in AI or other digital tools, as organizations map out productivity and investment allocations.[8] For many organizations, there will be a learning curve as they consider new learning and development tools to reskill employees or hire employees with new skills. Organizations can plan for these changes now by tracking successful leadership traits, hiring for these skills, and providing tools to current leaders to train them in these areas.

Organizations that had recorded baseline performance before COVID-19 are better able to plan for the future, as changes in performance during the crisis may not be sustainable afterward. However, small and sustainable improvements in performance can have a significant positive impact on corporate financial performance, and human capital leadership will be at the forefront of these changes.[9] When considering how to allocate budget to HR programs, a rigorous analytics exercise should be undertaken to optimize corporate financial performance and expected returns.

The table below summarizes employee experience and productivity measurements before COVID-19, during the pandemic, and expectations in the coming years after the pandemic has subsided. A similar table will follow each section in this report.

Before COVID-19 (prior to 2020)

Landscape

During COVID-19 (during lockdown and immediately after)

Expectations

After COVID-19 (after a vaccine is developed)

  • Human capital costs are often viewed as an expense or a sunk cost.
  • Budgets based on prior year need, adjusted for current year conditions.
  • Human capital program effectiveness measured against KPIs specific to those programs, rarely on impact on the organization’s financial performance.
  • Human capital metrics focused on demographic indicators, not on return on investment in human capital programs.

 

Measurements include: Individual productivity indicators from employee surveys, pulse surveys, and continuous listening strategies.

  • Raised awareness of the relationship between human capital performance, human resource programs, and organizational success.
  • Employees asked to go above and beyond normal work expectations in response to the “new normal” of work.
  • Organizations struggling with decisions related to lay-offs, furloughs, or reduction in pay, and workforce augmentation strategies. 
  • Some organizations are conducting cost-benefit analyses on “double pay” versus hiring new staff.
  • Supply chain considerations related to staffing, including identifying high vs. low priority recruiting.

 

Measurements include: Biometric indicators, such as time at work, location of work, and network analysis.

  • Labor may be “reset” as an input into the business model. Reallocation of budget dollars between human capital, real estate, operating processes, marketing, sales, etc., may occur.
  • Organizations will examine how work gets done, including a redesign of jobs to eliminate repetitive tasks that can be accomplished by digital workforce and reconstructing jobs to capitalize on cognitive requirements of work (i.e., problem solving, reasoning, and decision-making). 

Measurements include: 

  • Financial indicators of human capital impact including human capital ROI, human capital value add (HCVA), productivity, and evaluation of income and expense factors for a correlation between human capital and EBITDA performance.
  • Operational efficiency indicators of human resource programs include quantifiable impact of all HR programs including recruiting, performance management, and training and development, to understand and isolate the impact of these programs on corporate performance (e.g., EBITDA, budget performance, market share, and net promoter scores).

Employee health and well-being is now at the forefront of business success. Before COVID-19, many corporate health and well-being programs focused primarily on physical health, often with an objective to reduce long-term health care costs.[10] To measure the effectiveness of these programs, organizations tracked changes in sick days and productivity, program participation rates, and employee engagement scores.[11] In recent years, organizations have begun taking a more systemic approach to health and well-being, instituting programs to address all forms of employee well-being (i.e., mental, emotional, spiritual, and financial).

The crisis has profoundly affected the health and well-being of employees, from frontline healthcare workers and other essential workers putting their lives at risk, to remote workers balancing work-life boundaries when most care services are unavailable.[12] Four trends in measurement and tracking of health and well-being programs and policies are likely to continue after the pandemic:

    1. Health and safety concerns will require new levels of vigilance and support. The pandemic has heightened the value of health and well-being programs organizations offer to their employees, and these changes are likely to remain after the pandemic. In the short term, a second wave or recurrence of the pandemic poses an ongoing health threat to employees. As organizations consider reopening the workplace, they must consider and address the health and safety concerns of employees; tools like health scorecards and analytics will become more important. Monitoring of employee health, using temperature checks and other methods, may become more commonplace. In the long term, health and well-being may shift from an individual to a more social construct, as people understand the implications of an individual’s health on others. Organizations may develop new procedures for this “social” wellness, such as additional safety protocols and social distancing measures.
    2. Employers can expect an increase in the use of programs to drive new approaches and measurements. The magnitude of the pandemic’s impact on health and well-being may become a catalyst for accelerating the shift in how organizations approach employee health and well-being, including measurements that determine the impact of these programs. Many organizations have experienced an increase in the utilization in traditional employee assistance programs, but they have also expanded mental and financial health benefits and included additional services, like free telemedicine consults.[14] Measuring programs and policies will be more important than ever for ensuring a strong ROI for health and well-being initiatives.
    3. Workers are discovering a wider variety of health and well-being tools and offerings and may request new benefits offerings. Workers are experiencing new health needs and are turning to new sources to meet these needs. The pandemic has expanded the widespread adoption of new tools for health, such as BetterU and Bravely focused on mental health and coaching, 7 Minute Workout focused on physical fitness, Headspace used for meditation, and others. In fact, EdX, an open online course provider, experienced a surge of enrollment in spiritual and religious courses by 30,000 percent.[15] Many employers are considering these tools and providing new benefits offerings to support employee needs. Human capital teams need to collect appropriate data on the tools that employees need and the effectiveness of offerings.
    4. Blurring of work-life boundaries will intensify, and employers should consider burnout and other threats to well-being. In the long term, work and life boundaries may continue to blur, with more workers remaining remote or on flexible hours long after the pandemic. The impact of employee health and well-being for employers are likely to remain a high priority. Neglecting signs of burnout or fatigue may lead to productivity and attrition risks. Many employers will continue to track employee metrics to support a new, more remote and flexible workplace. Facebook, for example, is taking measures to prevent burnout by offering flexibility and childcare options.[16] 

Measurements

Before COVID-19 (prior to 2020)

Landscape

During COVID-19 (during lockdown and immediately after)

Expectations

After COVID-19 (after a  vaccine is developed)

  • Attention to physical health and measures of success often driven by insurance benefits
  • Fewer programs and measures of other forms of health (mental, spiritual, emotional, financial)
  • Increasing focus on work-life balance, including experimentation with unlimited vacation days

Measurements include: Employee assistance program (EAP) utilization rate, program participation (e.g., walking programs)

  • More attention to all forms of well-beingeing, health, and safety (physical, mental, spiritual, emotional, financial).
  • Widespread adoption of new tools for health
  • Work from home blurred boundaries between work and life, leading to burnout.
  • Layoffs and furloughs affecting mental and financial health
  • Vacations and plans for time off were put on hold with travel restrictions.
  • Delayed treatment for “non-essential” procedures.
  • Dealing with death and grief of family members and loved ones.
  • New class division between “essential” and “nonessential” workers, and those who can work from home and those who cannot
  • Increased isolation and family tensions, greater risk of divorce, and increased violence amplified the negative impact.

 Measurements include: An increase in use of EAPs and health programs

  • Increased attention to all forms of well-being, as the pandemic highlighted the importance of well-being for business outcomes
  • Increased monitoring and surveillance of employees (e.g., temperature checks)
  • New types of benefits and service delivery
  • Potential for increased health insurance costs after the crisis subsides
  • Potential for ending hazard pay but health threats will continue for essential workers and all workers in a return to the workplace
  • Fading of work-life boundaries may remain long after pandemic
  • In the long term, we may see an increase in digital workers for social distancing

Measurements include: Expect to see more measurements related to program effectiveness and corporate financial outcomes.

 

Measures of D&I impact are increasingly important and rapidly changing

Crises such as COVID-19 have long-term and far-reaching business ramifications. They also engender immediate, direct, and sometimes disproportionate impacts on the employment and finances of different worker segments. Furthermore, outbreaks give rise to social stigma, blame, xenophobia, and discrimination towards specific demographics. In the past, the Latinx community was blamed for swine flu, the LGBTQ+ community for AIDS, African Americans for Ebola. COVID-19 has expanded this list with its associated blame and aggression towards Asian people.[17] But the COVID-19 pandemic has also affected some populations in disproportionate ways and impacts how organizations should measure pandemic outcomes. Some of the impacted worker segments include:

      • Older workers Older individuals are physically shunned, socially isolated, and more likely to experience layoffs, along with individuals with pre-existing health conditions and comorbidity.[18]
      • Minorities Since women, people of color, and immigrants are overrepresented in low-wage and hourly jobs, they are also at a higher risk of being let go.[19] They are also at a higher risk of exposure given that they are more likely to be in “essential” and front-line occupations.
      • Less educated workers The economic impacts of the pandemic will have far reaching effects and may impact less educated workers disproportionately. [20] They may also have a harder time finding a job after the pandemic, as more workers compete for roles.
      • Younger workers New graduates are entering a dismal job market with little stability. Younger workers, particularly in low-wage jobs, are more likely to experience job loss. As unemployment rises and employers have more qualified options for open roles, new graduates are likely to struggle to find roles.[21]
      • Caregivers Due to ongoing school closures, women and single parents are taking on the brunt of caretaking and attempting to balance both work and family responsibilities and may even step out of the workforce as a result. [22]
      • Workers who contract COVID-19 People who test positive for the virus or emerge from quarantine are stigmatized and often avoided. On the flip side, those who have recovered from COVID-19 and potentially possess immunity might be labeled differently based on this status, contributing to a new divide for the “haves” and “have-nots.”
      • Workers with poor mental health The number of people who experience mental health issues is rapidly growing, amplified by the fatigue of long hours, grief related to the loss of close ones or even simply the loss of normalcy, and generalized anxiety.

Individuals who possess the ability, means, and vocation to work remotely are emerging as a greatly privileged population. The digital divide is amplifying pre-existing disparities as the “digitally fluent” can be successful in a remote environment. Meanwhile, small business owners, retail workers, and restaurant workers, who are disproportionately minorities, women, and other diverse groups, are more likely to be impacted by the threat of unemployment. In addition, they often lack access to healthcare and paid sick leave. 

Measurements

Before COVID-19 (prior to 2020)

Landscape

During COVID-19 (during lockdown and immediately after)

Expectations

After COVID-19 (after a vaccine is developed)

  • Diversity and inclusion efforts focused on growing the number of minorities or under-represented groups in the workforce
  • Programs to attract, retain, and reward minorities and under-represented groups (targeted hiring of veterans, women of color, women in STEM, Latinx individuals; contract sourcing from minority or women-owned businesses etc.)
  • Changes to workplace practices to ensure fairness and equity (gender-neutral restrooms, diverse interview panels, accessible workspaces, pay equity, leadership pipeline representation)
  • Employee resource groups and targeted programs to support these groups’ activities

 

Measurements include: Diversity representation in the leadership pipeline, promotions and overall workforce composition, diversity hires, slate diversity, bias in job description, pay gap analysis, participation in employee resource groups (ERGs)

  • Labor market imbalance disproportionately impacting the jobs of minorities and under-represented groups
  • Older workers more likely to be let go due to stereotypes such as lack of tech skills and agility and higher salary costs
  • Over-representation of women and minorities in essential jobs resulting in higher risk of infection, over-representation in nonessential businesses, and greater likelihood of being targeted for schedule reduction, furlough, pay-cut, or lay-off
  • Spread of misinformation leading to bias, xenophobia, ageism, and racism (especially against those of Asian descent)
  • Social isolation, loneliness, stress, fatigue, and grief, leading to significant disengagement and mental health issues
  • Digital divide causing amplification of pre-existing inequities and disparities (socioeconomic status, job classification, living situation/conditions, immigration status, family structure, the ability to move to virtual work)
  • Higher death rate for the elderly, African Americans, and the Latinx population

 

Measurements include: Labor costs, workforce reduction actions, pay/schedule/shift reductions, essential/non-essential designations, underlying conditions, child-care arrangements, engagement, interest in continuing remote work, unemployment rate

  • Tracing, monitoring, and surveillance that could lead to privacy and ethical challenges, especially since data bias could amplify disparities for minorities and under-represented groups
  • A bigger portion of childcare and other caretaking responsibilities will fall on women’s shoulders, limiting their ability to participate in paid work
  • Prolonged loneliness, social isolation, and mental health issues will lead to financial insecurity and shorter lifespans for older populations
  • Unemployment, market volatility, and eroded savings will force older workers to work in underpaid occupations or retire/take social security instead of continuing to seek jobs
  • A generation of graduates entering a labor market with record unemployment, rescinded job offers, significant financial strain, anxiety, and precarious employment will take jobs they are overqualified for, resulting in a long-term hit on their earnings trajectory and ability to catch up

Measurements include: Engagement, contact tracing, productivity, collaboration, focused time, risk of burnout, immunity, underlying conditions 

  

Employers must pay close attention to the emerging signs of division and help employees balance work and life demands within the newly written circumstances of work. The pandemic may provide us with an opportunity to assess implications and minimize impacts for affected populations.

Conclusion

Human Capital teams can use data to analyze employee-related decisions and choices. While organizations that have had strong human capital analytics functions before COVID-19 may be best positioned to compare data before, during, and after the pandemic, every organization should consider using data to make decisions going forward. This information can be particularly valuable in critical conversations today and in making decisions about engagement and productivity, health and well-being, and D&I that will have far-reaching impacts on the future of the organization.

 



[1] Philip Arkcoll, “Update: The Impact of COVID-19/WFH on Work Habits,” Worklytics, May 6, 2020.

[2] Frank Steemers, Robin Erickson, Amanda Popiela, and Gad Levanon, “From Immediate Response to Planning for the Reimagined Workplace,” The Conference Board, May 2020.   

[3] Philip Arkcoll, “Measure How Your Organization is Adapting to WFH,” Worklytics, April 1, 2020.

[4] Frank Steemers, Robin Erickson, Amanda Popiela, and Gad Levanon, “From Immediate Response to Planning for the Reimagined Workplace,” The Conference Board, May 2020

[5] Amanda Popiela, Amy Ye, Marion Devine, and John McMackin, “COVID-19 Reset & Recovery: Adapting Feedback and Performance Systems during and after a Crisis,” podcast, The Conference Board, May 2020.

[6] Jim Harter, “COVID-19: What Employees Need From Leadership Right Now,” Gallup, March 23, 2020.

[8] Francois Candelon et al., “The Rise of the AI-Powered Company in the Postcrisis World,” BCG, April 2, 2020.

[9] In fact, in January 2019, the SEC indicated that they will be viewing human capital as an investment in an intangible asset and material to the organization, requiring disclosures on performance on selected human capital metrics. By reclassifying this expense, how decisions are made about human capital investments will change going forward. Specifics of which organizations and what disclosures will be required have yet to be released by the SEC but are anticipated in 2020.

[10] Stephen Miller, “Employers Broaden Well-Being Programs,” SHRM, September 4, 2019.

[11] Amanda Popiela, “Mental Health and Well-being in the Workplace,” The Conference Board, May 2017. 

[12] For more information on how COVID-19 is affecting health and well-being, see our report “Human Capital Management during COVID-19: Support for Well-Being and Mental Health.”

[13] For more information on this topic, see our report COVID-19 Reset and Recovery: A Human Centric and Inclusive Approach to Wherever Work Happens, forthcoming in July 2020.

[14] Parmy Olson, “Telemedicine, Once a Hard Sell, Can’t Keep Up With Demand,” Wall Street Journal, April 1, 2020.  

[15] “We Are All One Crew + How to Innovate in Uncertain Times,” Virtual Solve at MIT, May 12, 2020.

[18] Chris Farrell, “How The Coronavirus Punishes Many Older Workers,” Forbes, April 14, 2020.

[19] Danielle Kurtzleben, “Job Losses Higher among People of Color during Coronavirus Pandemic,” NPR, April 22, 2020.

[21] Gad Levanon, “Covid-19’s Next Victims: Young Workers,” Forbes, May 28, 2020.

[22] Kate Zerrenner, “The Burdens of the Coronavirus Pandemic Are Largely Falling on Women,” Triple Pundit, April 13, 2020.

AUTHORS

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Amanda Popiela

Researcher, Human Capital
The Conference Board

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Solange Charas, PhD

Distinguished Principal Research Fellow
The Conference Board

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Stela Lupushor

Senior Fellow, Human Capital; Program Director, Strategic Workforce Planning Council, and Strategic HRBP Council

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