NOVEMBER 14, 2023
Business disruptions of the past few years — from The Great Resignation and Race for Talent to economic uncertainty and the introduction of generative AI — have had a profound impact on the talent landscape. CHROs have been busy collaborating across the enterprise and pivoting their talent strategies to ensure they have the right workforce in place to drive necessary growth and innovation.
As they continue to face high inflation, market instability and changing workplace expectations, our CHRO communities have been looking to one another for better ways to approach these challenges. In our latest Community Pulse Survey, we asked 300 CHROs about how the current environment is affecting their ability to find and retain talent and what their approach will be in the year ahead.
Here are 4 trends from the results of our survey.
1. Skilled Roles Are Harder to Fill
We simply asked if filling skilled roles requires more effort now than in years past, and exactly half of CHROs - 50% - said “yes.” About one-third of respondents - 31% - said that effort has been about the same, and only 19% said “no,” it is not harder to fill open positions.
Interestingly, one CHRO who responded “no” commented, “While the labor market continues to have its challenges, relative to the challenges of the recent past, we are finding that the market is less challenging, not more challenging today.”
2. Both Recruiting and Retention Pose Significant Obstacles
Almost every HR leader cited struggles with recruiting, with two-thirds - 64% - reporting it as “somewhat challenging,” and another 30% said it is “very challenging.” Only 6% said recruiting is “not challenging.”
Regarding retention, 70% of CHROs say it is “somewhat challenging,” and 20% report it is “very challenging.” Ten percent selected that it is “not challenging.”
In the comments, many HR leaders shared that they have decided to limit their focus on recruiting because of the challenges and effort involved. One mentioned, “I believe external options will become less attractive; there are fewer of them, and there is less ability to work full-time remotely. So to some degree, our strategy is to wait it out while staying true to our values and what we can offer, which is consistency and internal progression.”
3. A Key Focus Area: Retention Strategies
CHROs are using numerous methods to build and maintain a strong workforce, but retention is an overall common theme. Almost a quarter of respondents - 23% - specifically cite a focus on retention for key roles as their top priority, 19% are focusing on quiet hiring or internal promotions, another 19% are expanding searches beyond usual parameters, and 17% are upskilling or reskilling talent.
In the open-ended responses of the survey, nearly every CHRO mentioned retention strategies as critical to their future growth. One said, “Retaining talent is our biggest challenge. We are focusing on compensation reviews, updating total rewards offerings, leadership development to positively impact employee experience and sense of belonging.”
Another HR leader shared, “While we are focused on EVP internally and externally, the emphasis is internal with an eye towards retention.” A third detailed their approach to retention, and they stated, “Retention first. However, this must be for employees who are aligned with the goals and the vision more than being the easy choice.”
4. Many Factors are Impacting Talent Strategy
When asked about the factors currently influencing their ability to recruit and retain talent, 31% said it is the need for specific skills, such as in cybersecurity or data. Twenty-three percent believe it is due to a general lack of available talent, 21% attribute it to a lack of resources, and 20% attribute it to their overall workplace policies.
For the 5% of CHROs who selected “Other,” many outlined how salary expectations are not in line with their budgets or described their struggles with return-to-office. One CHRO shared, “We are swimming upstream against our return to four days in-office at year end. Employees are going to be extremely unhappy and, unfortunately, our competitors are much more lenient. Our CEO is unmoved by this, and we expect some turnover and a decrease in employee engagement.”
CHROs’ Forward-Looking Talent Strategies
The past few years have been riddled with disruption, so we asked an open-ended question for HR leaders to describe their forward-looking talent approach and how it may differ from years past. Experimentation with AI, a focus on upskilling, and an emphasis on employee experience were frequently noted.
Here is a sample of their responses:
We will leverage AI to target internal and external candidates. We are no longer just looking for candidates with similar job experience, but looking for great leaders who have the right complementary skills.”
We will upskill our existing talent for the future by training in automation and innovation techniques. We are recruiting internationally and providing continued growth opportunities to ensure retention of key talent.”
Focus on smooth executive transitions and develop internal talent to take on more senior roles in future. Ensure we have a robust technical skills development approach to ensure workers have the skills and capabilities we need.”
Through the up- and down-turn, what works is finding people who care about the mission and creating a great place to work. We need to be competitive, but not above market in our compensation/perks. We need to have high expectations for the workforce.”
by CHROs, for CHROs
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