As we enter the new year, the economy remains top of mind for many organizations as they make plans for their business. Due to varying expectations from economists, organizations are having to become more agile in their planning efforts. When these conditions exist, it is crucial to stay up to date on market trends, lead with intentionality, and focus on building your team to support your business.
There are several trends within the hiring market that businesses will need to monitor this year. Our Vice President of Staffing & Business Development, Megan Graham, is breaking down 4 trends to watch.
Continuance of labor shortage
The labor shortage of 2022 and 2023 is likely to continue into and throughout 2024. The Bureau of Labor Statistics predicts that jobs will grow by 13.6% from 2020 to 2040, but the talent pool will grow by only 6.2% during that time. This data supports the importance of employee experience and retaining top talent. As you think about plans for the year, focus on company culture as well as structured growth and development for your existing team.
Skills-based hiring
Due to the known labor shortage, we anticipate that skills-based hiring trends will continue to rise. When appropriate, companies should focus hiring efforts on skills and abilities rather than education or past titles. Data shows that skills-based hiring is more effective for identifying qualified candidates and helps build a diverse, inclusive workforce. Also, focusing on skills can increase your pool of candidates for certain roles.
Back in the office
In the back half of 2023 and into 2024, we saw a widespread trend of return-to-office work. Over 60% of employers require a minimum of three days onsite per week, with most requiring four. There continue to be niche areas, such as technology, in which this trend is not yet present, but most industries are returning to the office. Throughout this year, this will be a factor as organizations consider how to structure roles, employee retention, hiring needs, and company culture.
Artificial intelligence
Artificial intelligence (AI) is predicted to have a larger seat at the table in the world of HR this year. As many organizations seek to build their business using the talent presently on their team, they are considering how AI might support an increase in productivity. The challenge though, for many businesses, is how to operationalize AI while keeping a human element ever present. AI algorithms bring the promise of doing more with less, which is a necessity in a shrinking talent pool. If you are considering how AI can be implemented in your business, we recommend starting small. Bring AI in strategically to help your teams with routine tasks that are more easily transitioned. This will help them embrace and become excited about the possibilities, rather than overdoing it and creating doubt.
Bonus tip: Generative AI is a great place to begin. It is a form of AI that can produce various types of content for the administration of employee engagement, benefit enrollment & management, and many other internal applications.
As you monitor market conditions throughout this year, we recommend focusing on two primary areas: your people and your organization’s financial well-being. Encourage your team, give them the confidence they need to do their jobs well, and invest in them so they feel valued and continue to grow. Ensure they are supported and have what they need to meet your business objectives to grow profitability. Supporting your team will ultimately help support your business.
Lastly, be open to innovation. We don’t know exactly what will come this year but keep moving forward. Don’t let your business stand still; it should be ever-changing, growing, and improving. If FGP can help support you this year through staffing, search, or consulting, please contact us today.
