CORE HR, ATTENDANCE TRACKING, LEAVE MANAGEMENT

5 HR trends 2022 – what to observe, what to follow

The attempt to predict the future in the Covid era is a risky business. But it shouldn’t stop us from trying. The data shows clearly that technology will dominate the HR landscape in 2022. Keep reading to know more!

“Making predictions is hard, especially regarding the future” quote is misattributed to Niels Bohr, signifying the challenge regarding delivering accurate predictions. And Covid-19 was a game-changer, a black swan that was impossible to predict.

But on the other hand, though, it is not entirely true that the predictions made before the COVID era are completely missed.

Covid-19 and predictions

There was no way to predict the changes that were going to happen, with the great share of the workforce switching to remote work being only the top of mind example.

On the other hand, though, the McKinsey company and KPMG among others noted that the pandemic itself didn’t come with a revolutionary change. It was rather the great accelerator of the changes that were already there.

Thus when naming the digital transformation one of the key processes in 2020 or 2021, one would be right. The scope, not the trend itself, was surprising.

What is trend

  • Interestingly, the “trend” lacks a clear business definition while being used in numerous areas – from mathematics and statistics to sociology and fashion. To name something stronger than a fad or more important than a particular event, there are some conditions to fulfill:
  • Needs to show something about the present time
  • Has to show the direction on how some area can look in the future
  • Has to last for a longer time
  • Has to encompass more than one type of behavior or events

Knowing this, it is much easier to filter out the noise and spot the deeper trends that will shape the year 2022 no matter what happens.

Key HR trends 2022 to watch and follow

Considering what’s above, the most reasonable way to spot the trends is, to sum up, some events and threads and later group them into larger trends. Based on what has happened in 2021, they will much likely shape the future and further impact the reshaping of the global HR landscape.

Hybrid workforce

The hybrid workforce is not a new concept, yet it emerged during the pandemic due to the lockdowns. The concept is centered around the workforce provided with the ability to work remotely at will (or at least frequently) while being invited to work from the office.

Depending on the agreements between the employer and the employee, there are three major models of hybrid work, including:

  • Remote first – in this model the company expects the employee to work mostly remote, showing in the office only from time to time
  • Balanced – this model is finding the balance between working from home (or anywhere else) and the office, usually encouraging the employee to show at the office frequently.
  • Office first – this model is established on the dominance of the office-based working model while granting the employees the liberty to work from home from time to time, usually at least once a week.

The hybrid work model has got heavily established. According to the Owl Labs survey, 39% of employees working fully remote in 2021. These people, who have seen the benefits of working from home, are now willing to accept up to a 5% pay cut to be able to work at least part-time remotely.

Talents from all around the world vs. global competition

The prevalence of the hybrid work model has delivered both benefits and threats from the HR perspective. These are two sides of the same coin.

  • Access to remote employees from all around the world – with the war for talents ongoing and vast shortage of employees with certain skills (programmers, analysts, etc.) companies are increasingly interested in hiring nearshore and offshore employees instead of searching for them in the local market. Also, the companies operating in larger cities are increasingly interested in hiring the professionals living in smaller cities and villages, assuming there are people to hire. The pandemic, with people willing to work from their village houses or as a workstation, only boosted this trend.
  • Current employees can be hired by companies from all around the world – the same goes for the companies from more developed countries, willing to pay the employees in their currency (be that dollar or euro) and leverage the fact that the offshore employee has significantly lower living costs. Thus, the company can expect that its key performer can be headhunted by the company from literally another side of the world.

Considering that, new challenges arise in the HR departments, which are responsible for not only hiring the employees but also retaining them and building the culture of the company.

Engagement vs workplace issues

One of the key benefits of the remote work environment is cost reduction for both the employee and the employer. The former saves on the commuting time and costs need not dine in the city and finds the time to get better work-life balance. The latter spends less on the office utilities and can downsize the owned office.

On the other hand, though, it is easy to lose the spirit of the company with all employees working from home or not seeing each other for a long time. All these chit-chats near the coffee machine or social interaction ner the printer get lost when all the workforce is distributed. Thus, building and retaining the company culture in a hybrid work environment becomes increasingly challenging, with no clear and easy answers.

Flexibility

The next effect of the hybrid work model is about the flexibility unseen before. With traditional employees struggling with tardiness, the new model embraces the flexible approach toward working time. This has come with increased productivity, as 90% of respondents claimed to work more productively when being on the remote work. On the other hand, though, 55% felt that they are working more than they used to in the “office days”.

This can be a point. According to the Vouchercloud study, a typical office worker is productive for 2 hours and 23 minutes each 8-hour working day. With the transfer to home removing the option of just “being in the office” as “working” the new ways of showing productivity came to play.

Benefits and well-being on the rise

As mentioned above, the hybrid workforce comes with multiple challenges, with building employee engagement and loyalty being one of the toughest. This has made employee benefits a new way to establish the bond between the employees and employer.

Remote work and engagement

With the lockdowns, the traditional way of team integration like lunches or events was made impossible. To overcome this challenge, the companies decided to invest and build new ways to forge remote teams.

While unthinkable before, the online integrations with lunches and online games have become the reality in multiple organizations, including Calamari.

Also, it is increasingly frequent to make the office-based benefits more accessible from a home office. Sending fresh fruits and vegetables to employees’ homes can be the best example.

The mental stability of employees is the new asset of the company

According to the data gathered by The Atlantic, remote work increased loneliness by 67%. Also, the lockdowns, isolation, and fear caused by the new virus have resulted in the explosion of mental health problems.

According to the KFF data, the share of adults reporting anxiety disorder and/or depressive disorder counted 11% in Jan-Jun 2019 period. In the same period of the year, 2020 the share skyrocketed to 41.1%. The spike had a direct correlation with the lockdowns and the COVID-19 pandemic explosion.

The problem has been seen by the employers and startupers alike, with the former group being increasingly interested in providing their employees with wellbeing perks and the latter one thinking about how to deliver these perks in new, interesting ways.

More freedom for employees

While the business effects of employees staying at the home office were highlighted frequently, the most affected ones were the employees. For them, the pandemic has delivered multiple effects, both positive and negative ones.

New levels of personal flexibility

Remote working has switched from being a much-deserved perk to the everyday reality for many employees who never thought of it to be possible. Public administration and healthcare are just the top-of-mind examples to name.

The typical office is full of disturbances and makes focusing on a particular task a huge challenge. According to Nilli Lavie’s research “Blinded by the load: attention, awareness and the role of perceptual load” the brain is constantly switching between the possible distractions and the task to do. Thus, it is nearly impossible to be effective when doing more than one task at once.

Thus, answering the emails during the conference is not only rude but also brain-wearing. Assuming this liberty is granted by the employer, the employee can chop his or her working day into chunks and manage personal productivity in new ways. Writing a report in the early morning when nobody is working or stacking the meetings one day is just one perfect example.

Also, the advanced techniques of personal productivity-boosting like a power nap are now available not only for the managers but for a typical white-collar worker as well.

All assuming that the employee has provided the employees with liberty to manage their time at will and delivered other reliable and trustworthy metrics to follow.

Skill building

When granted more time for self-development and more flexibility in their daily routines, the employees started to embrace the lifelong learning principle. This comes with significant advantages for the employers also. In 2020 nearly one in ten EU adults aged 25-64 engaged in some form of learning, making them lifelong learners.

This comes as a result of the reduced stability on the market. According to Apollo Technical-gathered data, 52% of Americans are considering switching their job this year, with 44% already planning the change.

This is also seen in the “great resignation” movement. According to CNBC, over 4.4 million Americans have left their jobs in September only. This is a concern not only for employees demanding high-skilled employees but also for blue-collar workers employing them. These employees are unwilling to work for unsatisfying wages in an environment they don’t accept and are willing to push their careers further in search of a better future.

Side-gigging going big

Nasda! Data shows that 1 in 3 Americans have a side hustle. The report is not specifying what kind of hustle is that – be that programmer programming after hours, baking cakes, business consultancy, or driving Uber – this can be anything.

The more important aspect of the situation is the increased independence of the employees, who can build different income streams, have access to additional cash and make their position more secure in the increasingly volatile market.

The new reality of hiring

The hiring landscape has also changed, with the technology delivering new, inspiring tools to use daily. New hiring is hybrid, flexible, and faces new challenges as the rest of the business.

Remote

The need to “see” the candidate has been a principle for a long time, but with the work transferred to the home office, so did the hiring. In 2020, 84% of recruiters have switched to the remote tools from the traditional ones.

This way is fast, convenient, and safer, with the risk of being infected with COVID-19 (or any other disease) reduced to the minimum when both parties are staying at home. When combined with the ability to hire talents from all around the world without staying up from the coach, this comes as a convenient boost for the company and HR department alike.

Automated

With the digitization of the hiring process comes the ability to automate and boost the speed of the recruitment process. While still limited by the tech possibilities, the recruitment processes can be automated by the Artificial Intelligence solutions, including the Natural Language Processing used to analyze the documents sent by the applicants and the Image Recognition tools to extract valuable information from the more exotic resumes.

Higher turnover

According to the 2021 Employee Engagement and Retention Report, up to 52% of employees will be looking for a new job this year. This comes in an uneasy environment, where the employee is no longer soaked in the company culture by being in the office. Rather, the work has transformed into a more freelance way, where the employee switches only the guy who tasks him or her, while sitting at the same computer, doing comparable tasks. When things like location, commuting time, or comfortable office tend to lose importance, building the loyalty of the staff is a much more complicated matter.

Workplace automation

The HR teams are expected to make their approach more data-driven and, on the flip side, to gather more data regarding the processes and the tasks they perform. With the decentralization and digital transformation of the businesses, the same fate is shared by HR departments. Willingly or not, the HR specialists will have to become more tech-savvy and adopt new technologies at their daily tasks.

Enter the AI

According to Gartner data, the key motivation behind the AI adoption in HR depts does not cost savings (51% of executives polled). The strongest motivation is in improving the data-based decision making (62%), improving employee experience (57%), or automating the repeated tasks (51%).

Considering that, it can be interesting to use chatbots that can both guide the candidate through the initial stages of the recruitment process or answer his or her questions later. The chatbot is available 24/7, so the candidate is not suffering from being in another time zone or when the HR team is occupied.

Data-driven everything

The traditional approach to HR was based on the gut feeling of the recruiter and the needs of the company. But not anymore. The new landscape of HR technology enables companies to leverage the power of big data to gather and analyze the data of both candidates and current employees.

New startups and companies are emerging that facilitate the hiring process with access to new technologies and platforms designed to support the HR processes.

Armed with the ability to frequently launch the polls, map the skills and skill utilization in the company, the HR department starts to play a vital role in the overall business strategy more than ever before.

The new demography of the workforce

One of the most devastating results of the Covid-19 pandemic is the death rate. According to the WHO data, as of December 2021, there were 5.318 million deaths globally and over 270 million cumulative cases.

The event has triggered new social situations, with the Great Resignation being one of the most visible ones. But again, Covid-19 was only an accelerator, not the reason.

Aging population of developed countries

According to the WHO data, the number of people above 60th years of age has outnumbered the number of children below 5 years old and by 2050 one in six people on the planet will be aged 60 years or over.

This means that the traditional retirement systems are going to be severely tested in the upcoming years. Moreover, the healthcare system will be stretched to the maximum, with the population needing more healthcare-related services.

From the HR perspective, the aging population is a strong motivation to make the teams more diverse, with employees of various generations working together on the same projects.

Migrations

With the global workforce available at the fingertips of any employer, it is natural that the diversity in the teams increases further. From the employer’s point of view, this is not a bad thing after all. According to the data gathered by Forbes, the companies with more diverse teams performed up to 35% better than non-diverse ones.

Considering that, building a more diverse team will be boosted by the new demography approach and the employer’s will alike.

New working paradigms

Last but not least, the Great Resignation movement mentioned above shows clearly that the modern workforce is changing. According to the World Economic Forum, the pandemic was a mind-switching event, with people having a strong motivation to rethink and shift their careers.

The resignation rate is highest among new technology employees and healthcare workers, usually in their mid-career. The WEF concludes that the resignation is a clear sign of the new, decentralized job market, fueled by the new technology platforms.

Summary

The trends above show that the relatively stable and predictable HR environment of 2019 is never back. Companies are changing their approach, and the employees do so alike.

The only response is to follow these trends and employ new technologies in all processes, including the Human Resources departments.

If you wish to talk more about the ways the company can reinforce itself against the future and leverage the power of upcoming trends, don’t hesitate to contact us now.

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