02 October 2023 - 4 min read
We’re more than halfway through 2023 and that’s a good point to sit back and take a look at the issues that have dominated the human resources field over the last couple of months. Now’s a great time to try and pinpoint what trends we might see in the coming year too.
Here’s our guide to HR topics that have been trending in 2023 and our top predictions for topics that could come to the fore in 2024.
Three years have passed since the start of the COVID-19 pandemic and the dust has settled for a large part when it comes to its impact on the economy and businesses. This has meant that it’s clearer to see the changes that have come from the experience.
Perhaps the most striking has been the change in attitudes towards how we work. As we’ve progressed through the pandemic, many employees – and a lot of employers – have a changed perspective on work, how it needs to be completed and how it relates to ordinary, domestic life.
For most office-based organisations and businesses, remote-working was essentially the norm during the height of the pandemic, from 2020 to 2022 when social distancing was one of the main tools used to combat the spread of the virus. Many employers found that remote working increased employee satisfaction and productivity and even saved them money on office costs.
As vaccinations have increased and the threat of the virus has started to recede slightly, we’ve seen more traditionally-minded employers try to move back to forms of office working, where they have more control and power over the way that work is completed.
For the most part however, they have been unable to convince their employees to move back to in-office, 9 to 5 work, like it was completed before the pandemic. Instead, hybrid working has become the norm: where employees spend part of the week working at home, and part of the week working in the office. This balance between the two forms of work represents a way that employers who don’t truly see the value in remote working can still maintain an element of control over the process. It’s likely that we’ll see more employers make the switch to hybrid working as the months roll on, reflecting the permanent impact that remote working has had on the economy.
Since we emerged from the worst of COVID-19, there’s been a clear trend developing when it comes to recruitment: employers are increasingly prioritising having the right skills over other attributes when it comes to finding new staff for their team.
The increasing focus on skills when it comes to recruitment probably reflects the growing influence of the 2030 skills gap on the way we work and gathering anxiety amongst employers. A study by Remote, for instance, suggests that skills-based hiring has increased by 63% compared to the previous year.
We’ve written pretty extensively on this subject in this detailed blog, but the TLDR version is that systemic skills shortages, combined with the mass retirement of baby boomers, are ultimately expected to cause a huge skills gap in the UK economy by 2030. A turn towards hiring based more on a candidate’s skills rather than other factors could be a sign that the effects of the skills gap are starting to bite many businesses and organisations across the country.
Unless you’ve been living under a rock, it’s likely that your HR department has had to process a huge number of salary increase requests this year, and that you’ve seen more employees coming to you in clear financial distress. And that’s only a natural consequence of the extremely challenging economic times that we’re living in. It’s clear that the UK’s historic problems with low pay and low productivity are starting to catch up with the economy.
Inflation has remained stubbornly high this year, despite the Bank of England’s aggressive policy of interest rate rises to combat what it sees as a ‘wage price spiral’: where wages rise and prices rise as a consequence.
As a result, the cost-of-living crisis that we started the year with has shown no signs of abating as 2023 has dragged on. In many cases, it even seems to have got worse. As people have struggled to afford to pay for basic things, like energy, heat and a roof over their head, they have turned to their employers and asked for raises in pay to reflect the extraordinary price rises that they’re having to find money for.
But many commentators and economists have pointed out that we are more likely trapped in a ‘greedflation’ cycle, where many companies seek to use the current economic situation to drive up prices, keep them high and extract increased profits – not the wage price spiral that the BOE seems determined to fight. Whatever the cause, it’s clear that employees (and probably members of your own department) are really suffering under the economic strain of the ongoing cost-of-living crisis, as increased mortgage repossessions, food bank referrals and energy poverty seem to indicate.
The issue of how to respond to requests for pay rises is a difficult one for employers to respond to. Many employees have not received pay rises for a number of years, and historically, the UK has suffered from endemic low pay across many parts of the economy, contributing to low productivity. Without a raise in pay, employees will effectively be taking a significant pay cut – increasing the chances that they fall into financial difficulties and that they decide to look for work elsewhere, which ultimately costs your organisation in the short term and the long term.
Unfortunately, this issue looks set to stay with us for a while so it’s vital that organisations develop a strategy for managing this.
If you had to pick a buzzword to describe 2023, artificial intelligence or AI would sit high on top of the list. Famed global management consultants McKinsey are even calling 2023 AI’s ‘break out year’. The topic first exploded into the public consciousness in late 2022, when tech company OpenAI launched its latest version of Chat GPT – a language-model chatbot that could emulate human conversations – went live.
Since then, we’ve seen the release of a whole new variety of AI language-model chatbots, from Google AI’s Bard through to YouChat.
Many commentators are convinced that we are on the cusp of a technological revolution thanks to the rapid development of artificial intelligence, with a range of opportunities and challenges presented by its growth.
That said, it remains to be seen whether or not the promises, stirring words and optimistic outlook of the tech companies will actually translate to anything in reality. After all, artificial intelligence at the moment is still just a sophisticated mathematical prediction machine at the moment: it can’t yet think for itself or match the sophistication of the human brain. Yet is the word that’s doing the heavy lifting in that sentence though.
So, those are some of the trends that have dominated this year, but what about the next year – what does 2024 have in store for Human Resources departments to try and get their heads around? We’ll be writing more extensively on this topic in the coming months but here’s a taster of the type of things that HR departments should expect to see land across their desks in 2024.
Whilst most of our attention in 2023 has been consumed by the rapid ascent of artificial intelligence, another development that has the potential to be much more disruptive in the short-term (and probably long-term) has gone relatively unnoticed this year – the rapid growth of automation.
PwC estimates that there will probably be three waves of automation – and that we’re currently in the midst of the first, which threatens the jobs of 3% of workers worldwide. The following two waves are predicted to affect more and more workers. By the mid-2030s, PwC’s estimates that automation could threaten nearly a third of total jobs worldwide, replacing jobs that many people have performed for decades.
In a (morbidly) interesting way, some of the people most likely to be at the brunt of automation’s wrath are those who traditionally don’t really feel the effects of technology in the workplace: white collar, office-based workers. Generally, in the past, the types of workers whose roles are replaced by automation are blue-collar employees who perform manual tasks.
2024 has the potential to be the biggest year for automation across the economy in recent years.
In an article published on the LinkedIn blog which explores potential HR trends for 2024, Bertolino argues that a move towards continuous learning is likely to be a key feature of HR and L&D developments in the coming year.
Continuous learning, if you haven’t heard of it, is a fancy way of describing the idea that the key to career development is continually developing your skills, knowledge and experience at work. It’s becoming particularly popular in career development circles and 2024 could be the year that it hits the mainstream properly.
Whilst there is a whole collection of underlying theory behind that we can’t really do justice to here, the easiest way to practise continuous learning is to study a course or professional qualification that will expand your skillset in a specific way. If you’re working in HR, studying a CIPD qualification can be a particularly useful way to take your skills to the next level.
With peak oil steadily approaching, efforts to decarbonise the economy gathering pace and with only seven or eight years left to limit global temperature rise to 1.5 degrees Celsius there’s increasing pressure on organisations to improve the sustainability of their own companies.
This generally means developing and implementing a sound ESG policy. Environmental, Social and Governance policies are becoming crucial to the governance of organisations preparing for a post-carbon world and 2024 is likely to become the year that organisations really start to develop their potential.
Taking the time to get your ESG policy in order could allow your organisation to remain competitive, strategic and resilient in the face of escalating challenges.
We hope you’ve found this blog interesting and that it’s helped to solidify your knowledge of the issues that are currently most popular in HR and the issues that are potentially about to become trending topics. As with all things, trends come and go and our priorities as professionals are constantly changing and evolving. By keeping one eye on the present, and another on the future, we can help to make our organisations and our personal professional practice much more resilient.
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