Hiring, financial and economic challenges, the skills gap, and employee well-being will keep HR busy once again this year.
By Simon Kent
As the new year swings into action, HR is bracing itself on two fronts – planning for the future of work whilst also dealing with the aftershocks of previous years.
Marcelo Cuellar, vice president of client services for Korn Ferry, describes the current scenario in terms of being under the influence of a pendulum – the pandemic caused the pendulum to swing one way with little hiring or business going on. Post-pandemic, the pendulum swung severely the other way as lockdowns eased and businesses sought to catch up on lost time.
This pattern has repeated, but over the next year, Cuellar believes businesses will look to find a steady balance. “In 2023, companies need to know what the right size is for their business,” he explains. “It’s not that we need to grow – it’s about getting to be the right size for the year ahead.”
This “right-sizing,” he argues, can be applied to diverse areas of HR’s responsibilities, from how many employees are required at a particular time to where these employees and teams should be situated. Should everyone be hybrid? How many teams should be in the office? – and so on. Managing costs are also impacted by this approach. “It’s no longer a case of trying to hire everyone,” he says. “It’s about finding the right people who are ready to work in the right way.” After all, in this volatile marketplace, there is always a chance that a position recruited now will simply not exist in six months’ time.
Hiring talent is also seen as an ongoing challenge by Mary Alice Vuicic, chief people officer at Thomson Reuters. She makes the point that in the current period of economic unpredictability, the jobs which will be most attractive to talent will be those based on “healthy, stable businesses with proven models.” She notes that the previous trend of talent moving towards more speculative technology companies, such as cryptocurrency, has been replaced by a search for jobs in sectors that have proven resilient during previous times of economic downturn. She too believes that hiring levels will subside but adds that this will be replaced by a greater emphasis on companies developing and growing the talent they have.
This in turn means more strategy from HR for learning and internal mobility. “Leaders won’t just lead, but they will act as teachers and role model the behaviours needed for employees to advance in their careers,” she says. “Employers may decide to use budgets, not to entice a raft of new talent with high remuneration packets, but to help support existing staff through the cost-of-living crisis.”
The ongoing financial hardship is top of mind for Jason Fowler, VP and head of HR, Europe services at Fujitsu. He sees this issue continuing to rise in importance this year, forecasting a decrease in the overall quality of life for many individuals because of financial strain. “Employers, therefore, are equally likely to find that their employees expect more support from them to address this issue,” he says.
Fowler predicts more friction and industrial action as a result of the economic situation and an easing of demand for labour overall as organisations retrench in response to or in anticipation of challenging trading conditions. “The skills shortage will not diminish,” Fowler adds. “Therefore, those employers, and indeed those employee representatives, that are able to find common ground and pragmatic paths to compromise will ultimately prevail over those drawn into protracted stand-offs.”
Fowler also indicates further evolution in the area of hybrid work. He believes employees and co-workers are now expressing concern about the lack of connection in hybrid work, noting that fostering a sense of belonging is particularly challenging. “Building social relationships is more difficult,” he says. “More effort, time, and conversations are required.”
It will be critical that the employer creates emotional connections between talent, their peers, and their organisation. “By addressing the challenges of hybrid or remote work and fostering a sense of belonging and connection among employees, an organisation can retain talent and prevent them from seeking employment elsewhere,” Fowler says.
Isil Ata, head of human resources for Cigna EMEA, lists issues such as digital trends, the impact of the pandemic, and fast-evolving technological advances as all having an impact on HR’s considerations. “Employees across the globe are rethinking their priorities,” she says. “Adapting to new ways of working and the realities of life – where boundaries are unclear and new stressors and concerns are emerging.”
The company’s recent Cigna 360° Well-Being Survey indicated the impact of the ‘always-on’ culture, burnout, and stress incidences and work-life balance among the workforce as critical issues, including in the UAE. This was illustrated with nearly 45% of respondents willing to trade off higher pay for time to do other things of interest, whilst the number was even higher in the UAE at 53%.
“Workplaces that promote mental health and support their workforce are more likely to improve productivity and retention rates, and benefit from associated economic gains,” says Ata. “Employers must leverage new technologies to provide employees with the appropriate support and access to healthcare services. To retain talent, companies must adopt solutions that not only cater to the needs of their employees, but are also simple, affordable, and accessible.”
Ata says Cigna is already providing effective mental health support and has developed and maintained an inclusive work culture and working models. “The ability to demonstrate empathy in the workplace has become more important now than ever, particularly when it comes to the mental health and well-being of the employees,” she notes.
One aspect of the workplace that encompasses HR’s challenge for this year and beyond is described by Ata as the continued blurring of the personal and professional lines. The fact is that the impact of the pandemic, hybrid work, mental health, and so on, means the space between work and life is becoming narrower, and it is easier to cross the line between one and the other. “It is the responsibility of leaders to establish clear expectations, procedures, and boundaries that will help address stress levels whilst supporting a healthier working culture,” she says.