2022 has been a rollercoaster ride of a year for businesses, and, heading into 2023, we’ve identified some emerging HR trends to keep your eyes on. How human resources departments respond to the recession, a bizarre talent market, and everchanging technology will be exciting to track. It could also make a world of difference for your company in the new year.  

If this young decade has taught us anything, it’s that some HR trends are easier to predict than others. Since 2020, businesses and their human resources departments have ducked and weaved admirably through punch after punch. They’ve adjusted to a global pandemic, the Great Resignation and Reshuffle, and a near-certain recession, all in real-time. So a little predictability could do us all some good! 

Throughout 2022, we’ve kept our eyes on a few HR trends that we expect to expand or emerge entirely in 2023. In this blog, we’ll run through six trends that could use your attention. Of course, do what you can to expect the unexpected, but in the meantime, let’s discuss what’s right on the horizon. 

Retention will be top of mind

Thinking about retention may seem misplaced in the face of the massive tech layoffs we’ve seen to end 2022. Amazon, Meta, Twitter, Stripe, and more conducted large-scale RIFs (reduction in workforce) due to several factors, including the state of the economy and some overambitious hiring these past couple of years. Layoffs like this tend to come with the territory of a recession. 

However, once the dust settles, retaining your remaining employees becomes essential. That means building, and sometimes rebuilding, trust with your employees through your actions and words. How will you make your company more retention ready? 

Typically, a recession scares workers enough to stay in their current roles. When layoffs and sparse opportunities muddle the job market, employees tend to prefer the safety of the job at hand. While that will be the case for many, this talent market is unique. 

Employees empowered themselves to find their perfect fit during the Great Resignation. If you’re not conscious of your employee experience, that can happen again. Additionally, the imperative to turn attention towards retention snowballs into several other HR trends we expect to see in 2023. 

More focus on upskilling and management training

Investing in upskilling is an HR trend that’s gained more strategic momentum over the last few years, and for good reason. If you’re trying to retain your current employees, it makes sense to focus on their growth. Learning and development initiatives are a win-win for businesses and employees alike. With potentially leaner days ahead, you need to fill skills gaps with the employees already on your payroll. 

That presents a massive opportunity for your employees too! It shows you’re willing to invest your time and resources into their development, and they’ll likely appreciate that. Unfortunately, employee engagement is low right now. One way to fix that is by showing employees you care about their career development. 

Additionally, focus on developing your next group of managers and executives from within your organization. Management training gives top performers the tools to transition from individual contributors to leaders. If you want to keep those people around, show them you have a plan for their development at your company. 

Continuing the hybrid work model

Though fully remote work may slow down, hybrid work isn’t going anywhere anytime soon. Employees overwhelmingly value flexibility after seeing what they can accomplish working remotely. 60% of remote capable employees want a hybrid setup. It opens up opportunities for camaraderie between coworkers without completely sacrificing that flexibility. Instead of pushing to get your team in the office daily, continue iterating on a hybrid work model that satisfies everyone. 

Investing in wellness benefits

Health and wellness contribute to the productivity of your employees. Unfortunately, 48% of employees reported worsening well-being in 2022, according to Gympass. How do you plan to invest in your employees in 2023? Some popular options include improving mental health benefits or offering reimbursements for fitness purchases. We hope that prioritizing employee well-being is more than another HR trend but, instead, a standard approach moving forward. 

Embracing emerging HR tech

Human resources professionals have more technology at their disposal than ever before, and it’s time to run with it. What that means depends on the needs of your organization. Of course, your company Excel master hasn’t gone out of style yet, but more kinds of technology are creeping into the forefront. From cloud computing to AI to the metaverse, HR is ready to embrace these technologies. 

For example, companies with widely disbursed workforces need robust cloud-based infrastructure to support their teams. Next, the relationship between HR and IT continues as human resources teams invest in cybersecurity resources and cyber-hygiene best practices among employees. HR handles incredibly sensitive data, and it’s their job to protect it. 

More tech-savvy HR teams should consider investing in AI and machine learning tools to improve anything from recruiting to their people analytics. These especially control the data chaos at larger organizations, as seen with Pepsi’s adoption of a Lucy AI tool. This system optimized and centralized their L&D programs around the globe for a more seamless experience. 

Considering the massive amounts of data involved, PepsiCo’s HR teams would’ve been working on that project for months without Lucy AI. Though advanced options like that might not be for everyone, the teams that can use them effectively will find they’re a serious advantage. 

Finally, companies should get serious about their HRIS. What kind of system works best for your organization? Look for time-saving automations and highly secure platforms as a start. But then consider how you manage your employees as well. For example, would a robust mobile app help your team stay on top of workforce and data management? HR software isn’t cheap. So find the best one for your organization, and master it. 

HR outsourcing continues to help SMBs 

One HR trend that may carry over into 2023 is increased outsourcing of the HR function. Smaller companies, in particular, benefit from this arrangement. Small-to-mid-sized businesses may feel the economic squeeze from this downturn, making it harder to support an expensive in-house HR option. 

By working with a company like ADDA, employers receive as much or as little HR support as they need. Our distinct HRO model provides you with the strength and knowledge of an entire HR department at a fraction of the cost. If you need help with payroll, compliance, benefits administration, talent, and more, we have you covered. You can even use our a la carte ASO option to pick and choose your HR services as needed. 

No one can predict what 2023 holds, but with a bit of HR help, your business can be ready for anything. When you’re ready to learn how HR expertise can grow your company, schedule a call. We hope you have a Happy New Year!