2023 HR Trends - Top 5

1. A boom in skills-based hiring

Companies are hiring for potential rather than degrees. According to recent data from Remote, more and more companies are prioritizing experience over degrees, and skills-based hiring increased by 63% over the past year. As a new currency in the labor market, skills-based hiring is growing rapidly.

For more than two-thirds of Americans who do not have a bachelor's degree, skills-based hiring helps reduce salary and career restrictions while broadening the talent pool for companies. Employers benefit from skills-based hiring because it improves hiring efficiency, diversifies workforce perspectives, and expands the talent pool. This shift is accelerating as more and more professions, such as IT support and software engineering, do not require a degree to be employed. According to an analysis of millions of online job postings by the Burning Glass Institute, 44% of jobs required a college degree in 2021, down from 51% in 2017.

2. AI is transforming HR operations

The way companies manage their human resources could be completely changed by the use of AI. HR leaders must take a strategic approach to this change that focuses on assessing AI's applicability, building support for their teams, preventing risks, and ensuring compliance with legal and regulatory obligations.

Companies can use the power of AI to speed up processes, improve decision-making and the overall employee experience by encouraging collaboration with IT managers, employing the best people to oversee AI efforts, and investing in staff training. Ultimately, supporting the AI revolution requires finding a delicate balance between technological progress and human understanding, paving the way for a more productive, data-driven, talent-centered future.

Among the applications of AI in human resources are generative AI for job descriptions, job postings, messages, translations, skills assessment, AI machine learning for evaluations and behavioral analysis, data organization, training, and much more.

How HR teams can benefit from AI

3. A hybrid workplace for the long term

Hybrid work is now the norm. Nine out of ten companies combine remote and on-site work, according to a McKinsey forecast. Moreover, according to a ZipRecruiter survey, job seekers would accept a 14% pay cut to work remotely. To successfully make hybrid work the norm, business leaders and HR managers must establish clear principles rather than impose rules.

First, start by defining what the term "hybrid" means in the organization of work. Begin by defining hybrid work in the context of the organization and what it means for your processes. It is not just about how many days someone works in the office or remotely. Before an employee starts working under a hybrid model, the team leader and the employee must agree on rules that promote inclusion. These rules should include workspaces, required technology tools, team standards, essential collaboration hours, and success rituals. Then start a conversation about hybrid work with your employees, and then define the details.

4. Getting ready for "quick quitting"

Many industries continue to worry about losing a significant share of their workforce. Hospitality, healthcare, transportation, and retail are the most exposed sectors. "Quick quitting," or rapid resignation, refers to the phenomenon of deskless employees leaving a company shortly after being hired.

Although pay cuts may seem like an obvious reason for employees to leave a job, they do not appear to be the main driver of abrupt resignations. Employment decisions will always be influenced by pay; a Boston Consulting Group (BCG) study identifies a number of other factors that influence quick quitting. The study says the main drivers of quick quitting are emotional rather than financial. The study highlighted many factors that are critically important to deskless workers. These factors include fair treatment, respect, meaningful work, enjoyment at work, feeling valued, employer reputation, and good relationships with management.

According to BCG, employers should focus on the following to avoid quick departures: determine employees' desires by asking them what they expect from their work. Employers should also invest in employee experience by using technology to optimize workflows and hiring and onboarding procedures.

5. "Quiet hiring," or silent hiring

"Quiet quitting," or silent resignation, attracted the attention of the HR community in 2022. A new "quiet" practice emerged in 2023. In many ways, quiet hiring is the exact opposite of quiet quitting. Employees who quietly leave their jobs did the bare minimum to complete their assignment. Employers identify employees who go above and beyond through quiet hiring.

According to a Gartner study, quiet hiring is the top HR trend for 2023. Quiet hiring is fundamentally a strategy an organization can use to address skills shortages without changing headcount. Employers can fill staffing gaps without adding new permanent employees by focusing on internal recruitment and internal talent mobility. While quiet hiring may involve filling gaps by using temporary contractors, the trend generally consists of finding workers who can step into an available role within the organization. Temporarily changing an employee's role or giving them more responsibilities to meet an urgent demand are also examples of discreet hiring. Simple actions such as temporarily reassigning administrative staff to a customer-facing role can serve as an example of quiet hiring.

Companies can use this measure to deal with an unexpected spike in inquiries or to solve a technical problem. However, be careful: quiet hiring poses some risks. If another employee does not take on these responsibilities, employees who have been temporarily assigned to another role may think their current position is not very important. If the additional responsibilities are not rewarded enough, employees may feel exploited or overworked.