Move Over Quiet Quitting: These are the 2023 Trends to Watch for Talent Acquisition and Human Capital
2022 was another wild year. From the “Great Resignation” to inflation, talent acquisition and human capital professionals were left navigating a workforce that was consistently in flux. Looking to the year ahead, anticipate continued ambiguity and more change management given the evolving nature of the workplace, as well as the current economic climate.
So, what does this mean for the people and talent acquisition space? Here are the top trends to watch in 2023.
Hiring will be less about speed and more about rigor.
Companies will prioritize hiring a few specific roles versus growing at any cost. Recent Insight Partners’ data shows that leadership hiring is down 36% over the last year. The volume of executive hiring hasn’t been this low since Q4 of 2020. This indicates that companies are being more thoughtful in their approach to hiring and we expect this consideration to continue throughout 2023 – at the executive level and beyond.
There will be a greater focus on pay parity.
Over the past year, we saw compensation packages skyrocket. According to Hired, in 2022, the average tech salaries for roles at mid-market-sized companies (300-1K employees) increased significantly in the US (~$164K) and the UK (~£85.3K). The same report indicated that “average local salaries for candidates in mid-sized markets (medium-tier cities like Boston, LA, and Seattle) caught up to larger tech hubs.” This increase in salaries has caused greater pay discrepancies between new hires and more tenured employees. With new pay transparency laws coming online, there will be a greater focus on pay parity. Companies will need to reexamine their compensation philosophies and ensure alignment on compensation bands and leveling.
How we define and measure productivity will evolve.
This past year we heard a lot about “quiet quitting” and employees feeling less engaged in their work. As a result, leaders have been evaluating how to manage productivity without micro-managing or using “big brother” types of tactics (i.e., pulling data on Teams or Slack usage). In the next year, we will continue to discuss not only how we manage productivity but how we define it. Productivity will be less a measure of time spent in a seat and more based on a mix of creating value, outputs, and relationship building.
Manager upskilling will be a must.
This was a wild year for the workforce. Some companies went from hiring surges to reductions in force, leaving employees to take on more with less. Remote and hybrid work isn’t going anywhere, which has left many leaders to ponder how to build culture and connectivity without in-person face time. To help employees navigate through all this change and combat continued fatigue and burnout, managers will need to elevate their skillset. They won’t be able to apply the same in-person tactics they did before.
Recent Insight Partners’ data shows that leadership hiring is down 36% over the last year. The volume of executive hiring hasn’t been this low since Q4 of 2020.
Stability will sell.
Given the market, candidates and employees are more risk-averse than earlier in 2022. People will be wearier of changing jobs or working for less-established organizations. It will be harder to woo candidates solely based on culture, swag, and fun. Instead, companies – and specifically, recruiters – will need to be able to clearly articulate what the business is and how it is positioned to win in the market. Additionally, companies will need to focus on the stability of the role, salary, and benefits – anything that feels concrete and tangible to help employees weather the uncertainty of the current climate.
The era of the Chief People Officer will continue.
Gone are the days when “human resources” could act as an administrative function. Heads of People are now expected to take a more strategic, forward-looking lens, especially as we evolve our workplace cultures and manage through continued ambiguity. This will require greater rigor and focus on getting processes and structures right, so companies are prepared for when hiring – and the market – picks up speed again. Human capital leaders will be expected to have an innovative mindset and develop true cross-functional, executive partnerships to meet the increased demands of the role and help elevate all business functions at the organization.
If the past several years have taught us anything, it’s that companies and leaders need to be agile. While we can’t predict everything the future holds, we foresee that 2023 will be the year of focus, flexibility, and foundations. Leaders will need to take a more thoughtful, strategic approach to talent acquisition and human capital overall to attract and retain top candidates, as well as ready organizations for scale long term.