New research reveals key shifts that HR leaders need to consider when blueprinting workforce strategy.
By Jamy Conrad
As the world enters its third year of the global pandemic, nearly everyone is fatigued. This is especially true for HR professionals who are at the center of employee health and safety. They have had to navigate the sudden explosion in hybrid work environments and the rise in online interviews, hiring, onboarding and training, while being challenged by colliding gender and race issues.
Key industry trends have been captured in the TrustRadius 2022 HR Trends Report, a survey that polled U.S.-based HR professionals at all levels to obtain their perspective on five big issues affecting the world of HR.
1. Remote work is here to stay. Some 50% of HR leaders work for a company that offers a hybrid work model (sometimes remote and sometimes in-office) while 21% are fully in-office and 16% are fully remote. Ten percent of companies give employees their choice of work environment, with tech companies leading the way when it comes to a fully flexible remote work policy (19%).
Hybrid workplaces are trending up, and nearly half of HR leaders (48%) say that remote work increases productivity. Among the other half, 26% said it decreases productivity and 22% said it doesn’t affect productivity. HR leaders are less divided on remote work’s impact on employee well-being, with 65% saying that it improves employee well-being.
A commanding 85% of respondents agree with their company’s remote work policy. A combined 67% say that working from home has no impact on HR service delivery (35%) or makes it easier (32%), while 31% said being remote makes HR more difficult. While technology is likely to help in delivery of metrics and processes, remote work can impact the ability of HR departments to provide strategic people guidance. These statistics also reflect some of the disconnect associated with remote work, particularly for the HR function -showing the demand for greater communication with employees, as well as the need for companies to reinforce their core values and culture more often in these work environments.
2. The Great Resignation is likely permanent. Supply chain issues, driven in large part by pandemic-induced labor shortages, have been top-of-mind with business leaders for some time now. What’s more, the labor shortage has become noticeable in the retail and service industry sectors, making life more challenging for both businesses and consumers across the board.
The TrustRadius survey reveals that health, safety, and quality of life issues are the factors becoming most important to employees who choose to quit their jobs -and then decide not to return. The HR leaders surveyed say that the top company-based causes of The Great Resignation include stressful working conditions (31%), low pay (16%), lack of flexibility (15%), and failure to address work-life balance (13%).
Regarding these company-side reasons for the mass exodus of employees, some 30% of those surveyed think that “people have gained perspective on what’s important in their lives,” and a surprising 77% of HR leaders think The Great Resignation is a permanent labor market change. When asked how big The Great Resignation’s impact would be, 43% characterized it as “significant and permanent,” while 33% think “small but permanent” changes will persist.
3. The Great Resignation is having an impact on diversity, equity, and inclusion (DEI). Some 71% of HR leaders say that The Great Resignation will also impact their company’s own DEI efforts. TrustRadius’ data shows that 41% of HR leaders see the shift as an opportunity to increase diversity, while 44% think it will require them to “completely rethink” their efforts. Some 60% of respondents think that their firms are succeeding with diversity, while less than half of the respondents characterized their companies as being equitable (44%) and inclusive (43%).
The data shows that DEI efforts are due for an overhaul, and pandemic-driven changes represent a significant opportunity to revitalize these programs. Today’s companies are no longer limited by geography. Finding talent and partnering with community outreach and education programs have become a wide-open field. This new environment will positively impact DEI initiatives and will help make DEI integral to hiring efforts and company culture.
4. Workers regain power. Research around The Great Resignation also reveals what HR professionals already know: Workers are regaining power. Previously, the rise of the gig economy illustrated some of the benefits of flexible employee-employer relationships, and The Great Resignation has accelerated those trends. Employees are now unwilling to tolerate being overworked, underpaid, and unsupported. In fact, they’re demanding better pay, conditions, and work-life balance. If employers don’t provide what employees are demanding, employees will likely vote with their feet.
Interestingly, just 10% of HR professionals say that people are “hoping to max out government assistance,” and just 11% say people “expect too much from their jobs.” Instead, The Great Resignation has precipitated an economic inflection point, as employees are challenging the status quo and re-evaluating both life and career priorities.
While some workers, notably mid-level managers, are not likely to take on the system because they’re thinking of long-term career trajectories, The Great Resignation will have lasting, permanent impacts on how employees view work and how they seek out employers. The larger economy will feel the shock waves of The Great Resignation for years to come, and it is unlikely that work norms will return to “how it was” anytime soon. For those companies experiencing mass departures, The Great Resignation presents an opportunity to examine company culture, compensation, and more. Organizations that cannot hire and retain workers will be at a severe competitive disadvantage.
5. Reliance on HR technology is increasing. The pandemic has meant that companies are relying more than ever on HR technology. Fifty-five percent of HR leaders said that they’re currently investing more on HR technology; 45% are upgrading existing tech stacks; and 38% are increasing budgets for new HR technology. Companies in the technology sector are more likely to spend more on new tech as compared to non-tech companies (56% versus 37%), and tech firms are improving tech stacks (67% versus 44%) than their non-tech peers.
TrustRadius’ research found that in addition to supporting core HR functions, technology may have a positive impact on resolving bias in hiring. Some 49% of respondents think their HR software helps prevent hiring bias. Sixty-two percent of men believe their HR software helps prevent bias, compared to 43% of women. Women were also more likely to think their company’s tech has no impact on their diversity efforts. Just 15% of HR leaders said that technology reinforces existing bias, illustrating that the current debates around HR tech and unintended bias are likely to continue well into the future. Questions about who programs the tech will also persist.
Particularly during the pandemic, technology and HR seem to have made for an effective team. Many leading companies have learned that they must invest in upgrading current technologies or acquire new solutions to stay competitive and offer employees the solutions that meet their needs when and wherever possible. The effective, people-oriented solutions of tomorrow must deliver accurate data and offer HR leaders the time to assemble strategies based on that data.
Overall, the survey illuminates the fact that HR departments and HR professionals are always in the eye of the storm when it comes to unpredictable business climate changes. Today’s HR leaders must continue to navigate current conditions with hybrid work, while simultaneously planning for the future. What’s more, HR’s reliance on technology will only increase as the complexity of issues evolve, creating the need for continuous, actionable data.
Jamy Conrad is senior director of people at TrustRadius.