Jobs Are Being Cut Everywhere. So Why Is Everyone Hiring Psychologists?
There's never been a harder time to lead. Or to work.
As organisations cut jobs, restructure and face growing pressure from AI, something unexpected is happening: demand for business and occupational psychologists appears to be growing. Why? Because businesses are beginning to recognise that the challenges they're facing aren't simply about performance or technology. They're about people, trust and the systems in which we work.
Why Are Organisations Looking for Psychologists Right Now?
Fifteen years ago, I nearly became a clinical psychologist.
Then something dawned on me. People spend more time at work than almost anywhere else in their lives. If they're not happy and thriving there, it doesn't stay at work. It follows them home. It shows up in their health, their relationships, their sense of who they are.
That's why I pivoted to business psychology and now psychotherapy. Fix work, and you help fix a lot more than work.
In all the years since, I've never seen so many open roles for people like us.
That should be strange. The job market is cooling. Vacancies have dropped to their lowest level since early 2021, and the number of people on payroll has been falling year on year. As I wrote in my last newsletter, almost every client I work with is restructuring or making people redundant.
So why are organisations looking for psychologists right now?
I think the answer is simple.
People have had enough.
Why Is Everyone Running on Empty?
The numbers are stark. Mental Health UK found that 91% of UK adults faced high or extreme pressure or stress in the past year, and one in five workers took time off because of it. More than a third said they didn't feel comfortable telling their manager they were struggling.
It's not just a UK story. Gallup's latest global study found employee engagement fell to 20% in 2025, its lowest since 2020, costing the world economy an estimated $10 trillion in lost productivity. Daily stress, anger and sadness among workers remain above pre-pandemic levels.
And here's the bit that worries me most.
Managers are taking the biggest hit. Their engagement fell from 27% to 22% in a single year. Gallup has long estimated that managers account for about 70% of the variation in how engaged a team is.
So the people we rely on to hold teams together are the ones running out of road.
What Has Happened to Trust at Work?
Trust has taken a battering too.
My own professional body, the Association for Business Psychology, recently analysed 27,361 Glassdoor reviews from 12,696 employers between 2016 and 2026.
Trust fell sharply between 2020 and 2022, then recovered only to roughly neutral by 2026. It never got back to where it was.
The same pattern showed up across six warning signs, including burnout, disengagement, low psychological safety and strain on managers. By 2026, only 34 to 45% of the damage had been undone.
Neutral isn't the same as trusted.
People are still turning up. But they're more guarded about what they believe, what they share and how much they give.
Add in restructures, cost pressures and constant talk of AI changing everyone's job, and you get a workforce that's exhausted, burnt out and, frankly, cynical.
Why Haven't Traditional Workplace Wellbeing Initiatives Worked?
Over the last decade, organisations have thrown a lot at this.
Engagement surveys. Wellbeing apps. Psychometrics. Away days. Leadership programmes.
Some of it helped. A lot of it didn't last. And employees noticed. In the Mental Health UK research, 18% said mental health at work was treated as a tick-box exercise.
We had a call just last week with a brilliant tech company. They'd done everything. Psychometrics, a three-day offsite, group coaching.
None of it stuck.
And they wanted to know why.
That's a very different question from "can you run a workshop for us?"
It's a "why" question. And it's exactly the kind of question a psychologist is trained to answer.
Why Can't Great Teams Fix Broken Systems?
T
he ABP research offers a big clue.
When it looked at what predicts how people rate their employer, trust in the organisation itself mattered most. Trust in colleagues added very little once that was accounted for.
In other words, a great team can't make up for systems that feel unfair, inconsistent or opaque.
The researchers concluded that team-building and manager training, useful as they are, can't fix a problem that sits in the system.
That's exactly what our tech client ran into.
They worked on people. The problem was the system people were working in.
Why Are Savvy Organisations Thinking Differently?
Here's what I'm seeing.
The smartest leaders have stopped buying another programme. They want to understand what's really going on.
And they're realising the skills they need most are human ones.
When the World Economic Forum asked employers which core skills matter most, 67% named resilience, flexibility and agility, while 61% identified leadership and social influence.
LinkedIn's 2026 data shows people skills like team management, mentoring and collaboration rising in demand.
I
n the UK, one analysis of over 18,000 job adverts found communication was the most requested skill, appearing in 50.1% of them, with adaptability second.
Is AI Making Human Relationships More Important?
There's another reason these skills matter more than ever.
Amy Gallo, author of Getting Along, recently raised a worry I share.
If we get used to AI tools that never push back, never get bored and never disagree, what happens when a colleague challenges us? Or a manager gives hard feedback? Or a team has to work through conflict instead of around it?
Esther Perel has been making the same point.
T
alking to Elle about AI, she said, "it really redefines relationships in a very fundamental way."
And on her podcast, she went further. The more AI enters our lives, she argued, the more relational intelligence becomes the cutting edge at work.
I couldn't agree more.
Strong working relationships are built in the friction. Disagreeing well. Repairing trust. Staying in the room when a conversation gets hard.
Those muscles weaken if we stop using them.
Can These Human Skills Be Developed?
The good news?
These aren't fixed traits. They can be built.
A major meta-analysis of workplace coaching by Jones, Woods and Guillaume found positive effects on skills, with even bigger effects on attitudes and individual results.
Gallup's own work found managers on coaching programmes showed up to 22% higher engagement, with their teams up to 18% higher.
But, and this is the key point, it only works when it's done properly.
One-off events rarely change behaviour. People go back to the same systems, the same pressures and the same habits.
Real change comes from understanding what's keeping the old behaviour in place, and working on that, over time.
What Can We Learn From the Wendy Rhoades Effect?
If you've watched Billions, you'll remember Wendy Rhoades.
She's the in-house performance coach at hedge fund Axe Capital, a psychiatrist by training, helping traders get out of their own way.
When a trader loses his nerve, she doesn't send him on a course.
She gets inside his head.
It made for gripping television. But it wasn't just a Hollywood invention.
The show lifted the lid on something many people didn't know: top hedge funds really do employ people to help their managers and traders perform better.
For more than a decade, SAC Capital, the fund Axe Capital is widely seen as based on, employed psychiatrist Ari Kiev, often called Wall Street's first performance coach.
Real coaches told Fortune the portrayal wasn't far off.
Here's what I find interesting.
The smartest, most competitive firms worked this out years ago.
When the stakes are high and the margins are tiny, the edge isn't more data or another system.
It's how your people think, feel and decide under pressure.
Now serious, fast-growing companies outside finance are catching on.
They're realising psychology isn't a nice-to-have wellbeing perk.
It's a competitive edge.
Where Are Business Psychologists Being Recruited?
You can see this shift in where the roles are.
Just last week, a post landed in my feed listing twenty graduate roles and placements for business and occupational psychology students.
EY, Arup, Capgemini, Babcock, Unilever, Novo Nordisk, Bank of America. Some in the UK, others in Ireland, Brussels and the US. Nikita Mikhailov, Chief Psychology Officer at Audr and co-founder of The Goodness of Psychology, shares business and occupational psychology roles from around the world with nearly 40,000 followers.
He sees another driver behind the rise.
"There's been a huge increase in people analytics roles," he says. "There's so much data available in today's workplace, and organisational psychologists are perfectly placed to understand it. Very few professions are as capable of assessing and making sense of the numbers, and then translating that into what it means for people at work."
That's the combination organisations need right now.
Someone who can read the data and still see the human being behind it.
Government is a big player too. The Civil Service now has around 250 occupational psychologists, the largest occupational psychology community in the UK. Its Occupational Psychology Service, an internal consultancy across government, has been recruiting Senior Occupational Psychologists.
In defence, Babcock advertised for an Occupational Psychologist to support a specialist military unit, covering selection, learning, wellbeing and organisational development.
These are places where getting people wrong has real consequences.
What Does This Mean for Your Organisation?
Three questions worth asking this week:
If you've invested in culture or leadership work, what actually changed six months later?
How are your managers really doing? Not their teams. Them.
If you're restructuring, who's looking after the people who stay?
Fifteen years on, I still believe what I believed when I made the switch.
Work shapes lives.
When it goes wrong, the cost doesn't stay in the office.
That's why so many organisations are finally looking for a different, better way.
And why they're calling people like us.
I'd love to hear what you're seeing. Is your organisation running on empty? And what's actually helped?
Five Key Takeaways
Workplace stress, disengagement and declining trust are creating a growing need for psychological expertise.Organisations need to understand what's driving these problems, not simply manage their symptoms.
Quick fixes and one-off wellbeing initiatives aren't enough. Lasting change requires looking at organisational systems, leadership behaviours and the conditions in which people work.
Managers are under enormous pressure. Their own engagement and wellbeing matter just as much as the performance of the teams they're expected to lead.
AI is making human skills more valuable, not less. Resilience, empathy, communication, adaptability and relational intelligence are becoming increasingly important.
Business psychology is a competitive advantage. Organisations that understand how people think, feel and perform can build stronger cultures, better leaders and more sustainable performance.
Sources and Further Reading
Insurance Business UK – Vacancies at lowest in five years
BabyPips – UK labour market cooling, April 2026
Health & Protection – Mental Health UK Burnout Report 2026
Bernama – Mental Health UK tick-box finding
Gallup – State of the Global Workplace 2026
Benefits and Pensions Monitor – Gallup findings
Silicon Canals – Gallup manager variance
The European Business Review – ABP Industry Insights on employee trust
HR Online – WEF core skills
LinkedIn – Skills on the Rise 2026
StandOut CV – UK's most in-demand skills 2026
Elle – Esther Perel interview
Where Should We Begin? – 20 Years Later, Esther Revisits Mating in Captivity
Jones, Woods & Guillaume (2016) – Workplace coaching meta-analysis
MangoApps – Gallup manager coaching results
Fortune – Billions and real-life performance coaches
Financial Advisor – Hedge funds employing performance coaches
Modern Civil Service blog – Government Occupational Psychology Profession
Civil Service – Senior Occupational Psychologist listing
Babcock – Occupational Psychologist listing
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