Life Science Industry 2024: The lasting effects of COVID-19

Hybrid/Remote Working

The boom of hybrid and remote working began with the COVID-19 pandemic in 2020, normalising an approach many professionals hadn’t experienced before: the ability to perform their jobs from the comfort of their homes. This new working model provided employees greater flexibility, enhancing work-life balance, and increasing job satisfaction and productivity.

For many in the life sciences industry, fully remote work wasn’t feasible due to the hands-on and lab-based nature of their roles. Hybrid working emerged as the optimal solution, allowing employees to spend a few days on-site for wet laboratory work and the remainder of the week working from home on administrative and data analysis tasks.

In 2024 employees are still seeking remote or hybrid working opportunities to maintain the work-life balance they achieved during the pandemic. Companies that offer this flexibility are more likely to attract talent compared to those that cannot or will not provide such options. Flexible working models also allow companies to broaden their candidate pool, offering positions on a remote basis and thereby eliminating location constraints. This enables employers to recruit the best talent available, regardless of geographic location.

Employers are now striving to balance providing flexibility to their employees with incentivizing them to come into the office to foster a strong and collaborative culture. This balance is crucial in maintaining productivity, employee satisfaction, and a cohesive work environment.

Market Shift

The life sciences industry, which saw a boom during the COVID-19 pandemic, is now experiencing a significant market shift. During the pandemic, jobs were plentiful, and many candidates preferred the security of their existing positions. However, there has been a dramatic decrease in job vacancies across the industry, with the UK seeing a 42.6% year-on-year drop in scientific vacancies.

Historically, the life sciences sector has been less volatile than other industries, but the increase in investments during the pandemic has left a hangover of investor caution. The rapid expansion in investment has now been overcorrected, with investors seeking improved returns and has resulted in them being more cautious about their investments, particularly in small biotech firms that struggle to secure necessary R&D funding.

Larger companies have made redundancies in broader efforts to streamline operations and improve efficiency. Financial pressures, strategic shifts, clinical and regulatory challenges, market dynamics, and the drive for operational efficiency are all factors that have been leading to redundancies within the sector. While these layoffs are often a response to immediate challenges, they can also be part of long-term strategic adjustments aimed at ensuring the company’s sustainability and growth.

Widespread redundancies have resulted in a large number of scientists and other professionals being out of work, during a time when the job market conditions are particularly unfavourable. With more candidates now seeking fewer positions, companies are receiving an unprecedented number of applications, with many talented professionals now competing for the same limited opportunities, intensifying the competition.

However, it’s not all doom and gloom, companies are looking at strategic realignments with sustainability, innovation, and efficiency at the forefront of their priorities. They are looking to make long-term adjustments to ensure their business models are sustainable and resilient. Continued investment in innovation and operational efficiency will be critical for future growth. As the market begins to stabilize, there could be a gradual increase in job opportunities, particularly as companies achieve more sustainable growth trajectories. The demand for highly skilled professionals will always remain within this sector, albeit at times in a more competitive environment.

In summary, the life sciences sector is undergoing significant changes post-COVID, driven by financial pressures, strategic shifts, and market dynamics. This has resulted in layoffs and a highly competitive job market, with companies focusing on sustainability and efficiency while job seekers face increased challenges.

Salaries

The pandemic has significantly influenced salaries across the life sciences industry. During the pandemic, the urgent need for vaccines and treatments led to a surge in demand for professionals with expertise in virology, immunology, and clinical research. It also resulted in increased demands for diagnostic testing and related research. With the heightened demand for these skilled professionals, companies offered higher salaries to attract and retain top talent. This inflation was especially noticeable for positions which were directly related to the COVID-19 response efforts. Across the pharma and biotech industries, they saw a significant increase due to their direct involvement in the pandemic response, particularly for positions in R&D, clinical trials and regulatory affairs. The medical device and diagnostic industries had a variable impact, with some areas, such as diagnostic equipment manufacturing, seeing salary increases, while other areas which were not directly linked to the COVID-19 testing efforts saw more stability without any significant changes in compensation.

Flexible working also had an impact on salaries, with the shift to remote working allowing companies to hire talent from broader geographic areas having a lasting impact on salary structures within businesses as it allowed employees in regions with lower living costs to secure higher salaries than local standards.

Following the initial surge in salaries, the market has seen some correction, employers are now more selective with salary increases, focusing on roles that are critical to their strategic goals. The job market saturation, resulting in a high number of candidates competing for fewer positions, has also helped tamper salary growth despite the overall increase in demand during the pandemic.

In addition to pandemic influences, inflation and higher living costs have directly impacted industry salaries. Companies are adjusting salaries to maintain employee standards of living and retain top talent in a competitive market landscape.