9 trends HR Directors need to know in 2023

How HR Directors can prepare for this year’s challenges

HR teams everywhere are implementing their 2023 HR strategy. However, this year is already shaping up to be quite different from the past one. The high cost of living, the looming recession, the ongoing effects of quiet quitting, the Great Resignation, the unstable political scene… Each of these events and their impacts need to be carefully considered by organisations. Those who thought they could just whip out their 2022 strategy and slap a new label on it could be in for a difficult year ahead! 

There are, of course, very different challenges to handle, but also several fresh new opportunities that could propel innovative businesses forward. To help you prepare, here are the most important trends HR Directors (HRDs) should know in 2023, along with some insight from HR leaders worldwide about what’s in store.

We asked our sales director Craig Howells and our wider family to suggest the topics that are keeping HRDs up at night in 2023. And some opportunities for how to embrace these changes.

#1 HR trend – AI as a tool to improve everyday processes 

There is a lot of talk about AI taking over and helping to streamline processes everywhere. There are many ways to use the technology to optimise operations. Whilst we know that nothing can replace the human element of HR, innovative HRDs should think of ways for AI to take over the more mundane tasks, so the team can focus on being there for staff. This could include account set ups, generating documentation, matching people’s skills to available training opportunities or setting up chatbots to answer the more basic employee queries. This way, HR teams can dedicate their time to looking after your people. 

“We’re already seeing HR teams of all sizes use AI in everyday processes, and I think that’s only going to grow as the tools and potential of AI software grow in 2023.” 

Wendy Makinson, HR Manager at Joloda Hydraroll

#2 HR trend – Even more emphasis on equality, diversity and inclusion (ED&I)

At Let’s Talk Talent, we’ve been talking about ED&I for some time now. And we’re not about to stop! The basic level of effort demonstrated by many organisations will no longer be sufficient as we move into the new year. Workplaces need to be positive, safe environments for everyone, and businesses will need to future-proof themselves through diversity in order to survive.

“Changes to the hiring process, the onboarding process, the training, and upskilling programs in order for them to be accommodating of all the candidates’ needs ensure that the HR department achieves DEI at the organization.”

Yongming Song, CEO, Live Poll for Slides

#3 HR trend – Career development as a key retention tool 

We already know that career opportunities can be a great retention lever for employees. This is more relevant than ever as resignations are set to continue beyond the Great Resignation. It is much cheaper to upskill current employees than to recruit new ones, and HRDs are expected to go further than before when it comes to staff career development. HR departments need to show employees the art of the possible, and empower them so they can grab those progression opportunities. 

“Employees want to work for a company that is invested in their future and will help them grow their careers. Employers, meanwhile, need to fill skill gaps without the costs and hassle of hiring. Upskilling, reskilling, leadership coaching, mentorship, and other forms of employee development can address both points (…).” 

Matt Erhard, Managing Partner, Summit Search Group

Download our free career planning whitepaper for some additional tips and advice. 

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#4 HR trend – Driving down recruitment costs

The cost of living is hitting hard, and the looming recession isn’t going to help matters. Employees everywhere will soon start to ask for salary increases and bonus opportunities to better their financial situations and keep up with inflation. Businesses looking to save money will explore ways to drive down costs, and recruitment is the obvious choice. Optimising and streamlining current processes to generate efficiency will be an essential tool to keep the bottom line healthy. 

#5 HR trend – A personalised approach to employee wellbeing 

According to Craig Howell, Associate at Let’s Talk Talent: “Tired, overworked and burnt out are descriptors we are all likely to hear much more often in 2023.”

People have experienced several personal challenges and crises over the past year, and the media is painting a fairly gloomy picture of the future. HRDs everywhere will need to make their staff’s wellbeing their number one priority.

“In 2023, HR departments across the globe are taking a more thoughtful approach to employee wellness. Instead of simply offering a few surface-level benefits, HR teams are now taking the time to deeply consider employee wellbeing and implement individualized approaches. This could include offering flexible work hours, providing mental health resources, or creating a culture of open communication. By taking a more thoughtful approach to employee wellness, HR teams are showing their commitment to the well-being of their employees and creating a more positive and productive workplace.”

Grace He, People & Culture Director, teambuilding.com

Here are a few wellbeing tips from our team to yours for inspiration.

#6 HR trend – Transparency when it comes to pay 

Gone are the days of woolly pay increase or promotion criteria leaving staff feeling frustrated and undervalued. Organisations today are expected to show everything that goes into the decision-making process. 

“More transparency around pay will be a major HR trend going into 2023. Being upfront about pay saves everyone involved valuable time in each of the steps of the employee’s lifespan, from onboarding to retirement (…).“

Annu Daniel, CEO, Elohim Company

#7 HR trend – The importance of leadership and management  

The constantly evolving business landscape and current high uncertainty levels will call for high management capabilities in 2023. It is a business leader’s job to help people make sense of the changing conditions, to anticipate what’s ahead, and to determine how best to deal with each of these situations.

The leadership and management community will be called upon to turn upcoming challenges into opportunities, to get the business through the turbulent times and to help their teams to do the same. HRDs should be ready to give leaders and managers all the support they will need to do their job well. 

Read the article to find out how to nurture great leaders. 

#8 HR trend – Continuously improving the employee experience

Businesses are still experimenting with their processes. Remote working, hybrid, task-based work modes… This will remain a top priority in 2023. Employees’ lifestyles, preferences and work requirements are continually evolving, and so HR teams must also continue to work on creating amazing employee experiences. HRDs should regularly review their operating model to determine it is still fit for purpose, benchmark themselves against the rest of the market and find ways to delight their employees. 

#9 HR trend – Keeping employee data safe

We hear it in the news every day: data breaches, and ransomware attacks are becoming more and more common. HR departments hold a lot of sensitive personal data, from addresses to bank details and national insurance numbers. Strengthening security systems and keeping this data safe should be of paramount importance in the current context. 

How to make these trends actionable

As HRD your role will usually be top level and steering the ship. Identify where the opportunities lie in your business for adapting quickly and in an agile way. Which of these trends could make the biggest impact for your business. Choose one, and start making a plan for how you bring the business on that journey.

We are working closely with our clients to help them all unlock the potential in their people, whilst navigating these new challenges, and finding new opportunities. So, if you’d like to know more about any of the trends mentioned above, don’t hesitate to book a call with us.

You can also visit our HR strategy services page for free resources, including our free downloadable HR strategy whitepaper and HR strategy checklist.  

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