14 Top HR Trends to Transform the Workplace in 2023
The working world is almost unrecognizable from a decade ago.
It's now commonplace to Zoom call your boss while still wearing your pajama bottoms, stream edutainment content to your smartphone and join a team meditation session after lunch.
You might even go on a company retreat together too.
It's an exciting time but full of uncertainty amid talk of layoffs, budget cuts, and restructurings.
So, as an HR pro, you must stay on top of the latest trends to keep up with the changing face of the workplace.
This guide digs deep into 14 key HR trends emerging or already going strong in 2023.
Which ones will your team embrace this year?
🔍 4 Factors shaping HR trends in 2023
Before we dive into the hottest HR trends of 2023, it's essential to understand the foundations of the landscape. Each of the following hold a significant influence on the way teams manage their people.
- Economy: the economic turndown since 2020, the war in Ukraine, and sky-high energy costs have caused many companies to rebuild and reframe their strategies to get back on track. This hostile economic environment means shifting HR practices to meet the demands of a new economy.
- Quiet quitting and the Great Resignation: 2022 was the year of quiet quitting. Resume Builder highlights that 26% of workers are only willing to do the bare minimum to meet their job requirements. Similarly, the Great Resignation epidemic was still going strong in late 2022, with 4 million Americans quitting their jobs in October alone.
- The rise of AI: global enterprise adoption of AI is expected to grow at a CAGR of 38.1% between 2022 and 2030. For HR, this means leveraging AI-driven decisions to automate mundane tasks, increase efficiency, and free up valuable resources.
- Reframing the role of HR: the post-pandemic era has changed the conversation around people issues, so we can now see HR as a strategic partner rather than an administrative support role. HR professionals must stay ahead of the curve to develop and implement meaningful strategies that align with their organization's goals.
📈 14 HR trends in 2023
Check out these 14 fascinating trends changing the face of HR throughout 2023 and beyond.
😟 1. Responding to layoffs
Companies in every industry are feeling the pinch, with consulting firm McKinsey recently announcing 2,000 layoffs, Twitter axing more than two-thirds of its workforce, and Amazon cutting up to 18,000 jobs.
These are far from the only examples—a layoff tracker calculates that 392 companies have already laid off almost 109,000 employees in 2023 (at the time of writing).
Layoffs are brutal for everyone involved—the fired employees and their families, their remaining colleagues who must pick up the slack, and HR teams who must deliver the heartbreaking news. Companies have an opportunity to make the process as humane as possible by offering to support their ex-employees in finding future work.
In some cases, it might be possible to avoid layoffs altogether by offering secondments that repurpose talent in other essential areas of the organization.
For example, Zapier's recruitment team has a surplus capacity as hiring has slowed at the automation company. But rather than downsize the team, Zapier's highly valued recruiters have been moved into other impactful roles, as the company did during COVID-19.
Zapier's Chief People Officer Brandon Sammut explains:
"Recruiting volume ebbs and flows. And recruiting teams have skills that can be applied to other areas. So when we have temporary surplus capacity, why not reallocate folks elsewhere? They'll add value and pick up skills and context that'll power their success in recruiting–and wherever their career takes them at Zapier or elsewhere."
➡️ HR action: Getting HR involved as early as possible is critical to making decisions about the future of your workforce.
Carry out regular skills audits to explore how you could redistribute talent across your organization to add strength in other vital areas of the business without terminating employment.
✏️ 2. Encouraging side gigs
Another way to avoid layoffs is to encourage employees to move to a slasher employment model.
The term "slasher" was coined by author Marci Alboher, who described a character's job as being a journalist/web editor/PR.
The idea is that slashers juggle several fulfilling roles they feel passionate about rather than choosing a job and an employer for life.
Although side gigs or moonlighting have previously been frowned upon or grounds for employment termination in the corporate world, some companies are now actively embracing this work style.
For example, a major Japanese trading house, Mitsui & Co, is the latest to grant its employees the right to pursue side hustles.
And a recent Zapier survey reveals that 40% of Americans participated in a side hustle during 2022 (up from 34% in 2020.)
There are multiple benefits for companies who follow this trend, including:
- higher employee engagement levels;
- gaining business experience from multiple work streams;
- reducing contracted hours of employment.
On this last point, Denise Hemke, Chief Product Officer at Checkr, explains,
"It's no secret that the rise in inflation is leaving companies in need of budget cuts at the risk of falling into a recession. However, instead of opting for layoffs, one of the best ways to support employees is by reducing working hours to reduce salaries without having to let anyone go. When working hours are reduced, employees will have more time to take on side gigs or other remote jobs that can help them stay within the same salary bracket."
➡️ HR action: By inviting employees to explore other avenues of income, HR can encourage workers to take ownership of their careers.
However, it's always worth clarifying the company's stance on side gigs or part-time work by adding a policy to your company handbook.
Here are some questions you should address:
- What type of income may gig workers earn?
- What is your stance on working within the same industry or for competitors?
- How will you ring-fence their work at your company, so their external employment doesn't take precedence or cause productivity issues?
🙏 3. Investing in wellness-focused employee benefits
Employee burnout is a global concern exacerbated by the pandemic, remote working, and the global economic climate.
A recent Slack survey found that burnout is on the rise globally. In the US, 43% of middle managers reported burnout, higher than any other worker group.
It's no surprise then that savvy employers are investing in well-focused employee benefits to attract, engage and retain top talent.
Mercer research highlights that 70% of large companies and 53% of small business leaders are planning benefits program enhancements for 2023.
And this is a step worth taking because some 55% of employees in 2022 cite health and wellness programs (such as gym memberships, fitness facilities, and medical screenings) as a key consideration when accepting a new role.
Research from MetLife highlights that this is double the pre-pandemic figure for this type of benefit—employee wellness is now a top priority.
Michael Green, Co-founder of wellness center Winona, explains,
"In 2023, the focus on employee well-being is an HR trend that organizations cannot ignore. Companies that prioritize their employees' well-being will reap significant benefits in terms of productivity, engagement, and overall satisfaction.
Another way to support employee well-being is through promoting self-care practices. Encouraging employees to engage in activities such as mindfulness and exercise can help them recharge, reduce stress, and improve their overall health and happiness."
➡️ HR action: If your company doesn't already offer employee well-being benefits, now's the time to invest in this perk.
If your budget is limited, try sharing wellness resources such as free online yoga or meditation classes or teaming up with a fitness provider to offer discounted gym memberships.
Signpost resources for mental health support and work with your managers to ensure they understand best practices to talk to their employees about any issues.
➡️ Read our comprehensive guide to learn more tips on how to improve employee well-being.
👶 4. Enhancing support for parents
58% of working mothers believe that the COVID-19 pandemic has made it more challenging to juggle childcare and work, according to Pew Research.
And numerous families have cut their hours or stopped working altogether to take on childcare responsibilities instead.
Accountant and Twitter user E-Beth Marshall describes her family situation during the pandemic.
While many companies are starting to offer enhanced maternity and family planning benefits, HR can take steps to think "beyond the bump" and provide ongoing support for families who want to contribute both at work and at home.
Jessica Higham, Marketing Manager at femtech company Onoco, reveals:
"We're expecting to see a more innovative range of parental support policies and tools being implemented in workplaces, as many businesses seek to retain the amazing talent of parents which is otherwise being lost due to lack of support, both financially and mentally, and policies that don't provide the long-term care and support many parents need.
Enhanced parental leaves are fantastic, but what happens after this? The return-to-work period is one thing for new parents, but having to juggle their personal and professional responsibilities beyond this is another. They need to be confident in flexible working policies for when their child is ill or childcare falls through; they need to be able to be home for bath and bedtime and to fit their work around this. They need to know that their management appreciates and understands this without judgment or discrimination."
➡️ HR action: Find out what your working parents want by asking them! Conduct employee pulse surveys and use employee resource groups to understand better how you can support your team with flexibility and career progression opportunities.
Gather performance review and salary data and analyze if you could do more to offer equal opportunities and pay for all employees.
🏝️ 5. Taking a proactive stance on rest
Employees are exhausted and don't receive the rest and recuperation they need.
Kornferry research highlights that 58% of employees feel stressed being away from the office. And the #1 reason is that they're worried about increased workloads waiting for them due to staff shortages.
Offering paid time off isn't enough, as not all employees take it, especially if it's unlimited.
Personal branding agency, Klowt recently canceled and recreated its entire benefits package because employees weren't making the most of their unlimited vacation entitlement.
A top trend for 2023 is for companies to offer employees rest proactively. Previously, employers have waited for employees to require medical leave to deal with mental or physical health issues. But rest is a necessity, not a recovery solution which is why an increasing number of companies are offering:
- Duvet days: take unscheduled time off throughout the year whenever you need it most
- Four-day weeks: get the same amount of work done in fewer days without a pay cut
- Company-wide shutdowns: the entire company takes the same week of vacation off in tandem, so there's no pull to check emails or log in to that team Zoom call
- No meeting days: meetings eat into the time it takes to complete deep work and can be an energy suck.
- Mandatory wellness time: take an afternoon nap or go for a walk to recharge
- Flexible lunch breaks: enjoy a long lunch at whatever time suits you
Gartner reports that companies that invest in proactive rest experience a 26% boost in employee productivity.
➡️ HR action: Human Resources teams must provide proactive rest that meets the following criteria:
- Available: employees should have several options to rest and feel energized.
- Accessible: employees must be aware of their options and encouraged to use them without guilt.
- Appropriate: the options available must be relevant to each employee's needs.
💼 6. Using quiet hiring to reshape the workplace
In case you need another buzzword, quiet hiring is another top trend of the year.
Think of it as an under-the-radar recruiting strategy, where HR leaders snap up the existing skills in their internal teams rather than seeking them externally.
Once you've identified the business areas where you need to add bandwidth, you'll analyze your current employee skill sets and decide who to "quietly hire" into these roles.
Although the term might sound jargon-y, the situation is a win-win for employees and employers alike.
As Lorien Strydom, Executive Country Manager of Financer.com, explains:
"Over the past few years, we've seen our employees become increasingly interested as they look for growth opportunities and develop their skills.
To stay ahead of this trend and make the most of it, I suggest allowing colleagues to easily access available positions within the organization and self-manage their ongoing development. In addition, companies should consider creating clear systems that recognize strong performance across departments by providing extra recognition or rewards. Prioritizing internal mobility is something I'm sure many organizations will benefit from if done correctly."
➡️ HR action: Conduct a skills gap analysis to better understand your required skills and competencies.
Then use data from 1:1 meetings, employee surveys, and performance discussions to uncover hidden talents in your organizational line-up.
❗ A word of caution: quiet hiring is so-named as the opposite of quiet quitting. And some employers choose to internally promote people who "go above and beyond" (those employees who don't quiet quit.)
But HR leaders must exercise responsibility in avoiding piling more work onto swamped team members without using a formal promotion and salary band framework.
➡️ Use a career progression framework with salary expectations to ensure absolute transparency during this process.
👩🏾🤝👩🏼 7. Investing in diversity hiring
Workforce diversity is growing in terms of race, ethnicity, and age, with more people of color and those aged over 55 powering the economy than ever before.
But diversity hiring isn't just something happening out of necessity; it also drives significant business results.
McKinsey data highlights that organizations in the top quartile for gender diversity in leadership positions are 25% more likely to be highly profitable than companies in the bottom quartile.
Diverse companies also attract top talent in the labor market. Monster research shows that 83% of Gen Z prospective employees consider an employer's commitment to diversity before they apply for or accept a job offer.
🌈 Need more convincing? Discover extra diversity in the workplace statistics you cannot afford to ignore.
So, how can companies create a more diverse and inclusive workplace? The key lies in recruiting for potential, not just qualifications.
HR leaders can use specialist recruitment tools with features like:
- anonymous screening;
- skills-based aptitude testing;
- gender de-coding job description tool;
- structured interviews.
A skills-based hiring approach ditches resumes, qualifications, and educational experience to assess an applicant's potential to succeed in a given role. This approach enables employers to widen their candidate selection net and recruit the best individuals regardless of pre-existing barriers.
➡️ HR action: Refresh your job postings to focus on the skills needed for a role and scrap the need for educational credentials.
Then take names, ages, addresses, and any other obvious identifiers out of the screening process, to ensure unconscious bias doesn't creep into your hiring processes.
Finally, regularly review the percentage of diverse applicants vs. the percentage of diverse hires.
If there's a mismatch, it's time to review your diversity recruitment strategies.
📊 8. Prioritizing performance transparency
Only weeks after Meta laid off 11,000 workers, the parent company of Facebook and Instagram has now delivered "subpar" performance reviews to 10% of its employees. This move could signal more cuts, with CEO and founder Mark Zuckerberg asserting that 2023 will be a "year of efficiency."
While we don't know the content of these performance reviews, we do believe that they're part of a broader performance evaluation trend based on transparency.
Employees need to understand what their employer expects of them and receive regular feedback on their progress—not just from their manager but also from their peers and direct reports to offer well-rounded insights into their performance.
However, performance transparency isn't just about performance reviews. Instead, it's also about ensuring everyone has role clarity, including the required skills and competencies. They must also understand how these align with the organization's bigger picture.
➡️ HR action: Build crystal-clear career frameworks, so everyone understands what "success" means for a specific job.
Encourage clear communication between teams and across departments so employees understand how their work impacts the whole organization.
Finally, add transparency to performance reviews: share feedback with employees at regular intervals and give them access to their performance scorecards so that they can monitor progress.
🧑💼 9. Promoting human leadership
A company is only as good as the people who work for it, and those people will reach their true potential with strong human leaders behind them.
Gartner's research states that this is a priority for 60% of HR teams. Yet, a worrying 24% don't believe their current approach prepares leaders for the future of work.
They note three imperatives embodied by human leadership, including the ability to be:
Companies can achieve this by creating environments that support open dialogue and two-way communication while training leaders on soft skills such as coaching, collaboration, and compassion.
➡️ HR action: Invest in programs to support your leaders, from leadership coaching to frequent feedback and recognition.
360-degree performance reviews will help you identify areas for improvement and allow your leaders to gain insights into their behavior and how it impacts team members.
🤖 10. Exploring the metaverse
The metaverse is a virtual space that facilitates real-time interactions and collaboration. Although relatively new, it's also one of the hottest trends this year.
Gartner forecasts that people will spend at least an hour daily in the metaverse by 2026.
Companies can use this to:
- Extend training programs to simulate work environments safely.
- Host recruitment fairs.
- Quickly prototype new services.
- Explore the future of work.
It will become increasingly important for companies to embrace digital transformations to keep up with the growing pace of change.
➡️ HR action: Get familiar with the metaverse and technologies such as virtual reality (VR), augmented reality (AR), and more to explore its potential applications in your organization.
Collect employee feedback to discuss how they might wish to experience the metaverse.
🚨 Don't forget to work closely with IT to establish solid security protocols around it.
🎮 11. Embracing gamification
Gamification involves using game design elements and mechanics in non-game contexts to engage and motivate users. And it's a strategy that works, with 83% of employees who complete training with gamified elements feeling motivated compared to 61% who consider their non-gamified training dull.
It's far from a new concept—gamification was invented in 2003.
Still, there are projections that this market will reach a whopping $30.7 billion by 2025, according to MarketsandMarkets analysis.
And it's been going down a storm in L&D.
Deloitte now uses gamification in its Leadership Academy training, leaning on badges and status symbols to drive learning engagement. Users describe the platform as "addictive," and daily use has increased by 47%.
HR can use gamification in a variety of ways to supercharge employee development, such as:
- Setting clear learning objectives and goals: Employees can track their progress and understand what they need to achieve.
- Embracing elements like points, badges, and leaderboards to provide feedback and recognition to learners for their achievements.
- Creating immersive learning experiences: Interactive, challenging, and fun activities ensure learners stay engaged and motivated throughout the learning process.
- Providing immediate feedback: Deliver immediate feedback on progress and performance. Learners understand their strengths and weaknesses and adjust their learning strategies accordingly.
➡️ HR action: Incorporate gamification into employee training programs and watch skills development soar. Always reward participation and monitor progress and feedback to motivate and engage employees.
🔮 Check out more top learning trends driving workplace L&D in 2023.
🔢 12. Leaning into algorithmic HR
Algorithmic AI is one of the biggest HR trends of 2023. It's all about leveraging analytics, machine learning, and AI to optimize recruitment processes, reduce bias, provide positive employee experiences, and streamline HR operations.
Example: A machine learning algorithm detects changes in Employee A's performance that would otherwise go unnoticed. If their work drops below normal levels, the algorithm can alert HR to assess why it's happening.
Grace He, People and Culture Director of virtual team events company teambuilding.com, breaks down why data-driven decision-making is so valuable for HR teams:
"With greater access to analytics and technology, people teams can look at data with a more comprehensive lens when crafting policies, setting goals, and understanding their workforce on a larger scale.
To embrace this trend effectively, organizations should look for ways to use existing analytics tools with their internal employee strategy. For instance, companies can look into predictive models that analyze variables such as productivity or even potential employee churn rates. By projecting data points such as these, organizations can better anticipate future changes within the workplace and develop policies accordingly.
This approach to HR can maximize efficiency while supporting employees appropriately by staying ahead of crucial shifts in the business environment."
➡️ HR action: Some companies may experience a battle between knowing when to combine data with the more "human" aspects of HR or when that "human" behavior is causing bias over the data.
In fact, Aptitude Research highlights that over half of talent acquisition professionals have some level of certainty about using AI in their tech stacks.
Training is vital here, as explained by Julian Taylor, Employment Lawyer at Julian Taylor HR, who told us:
"My top tip here would be to ensure your organization provides training and education on the use of AI and machine learning in HR processes. This should make sure that employees are comfortable with the new technology and understand how it affects their work."
🗣️ 13. Experimenting with ChatGPT
ChatGPT has taken the world by storm since its November 2022 launch, promising to do everything from writing emails, resumes, and blog articles, to solving math problems and writing code.
Adoption of OpenAI's chatbot has been rapid, with Reuters reporting the app hit 100 million monthly active users in January 2023, making it the fastest-growing consumer application in history, according to a UBS study.
HR teams are still getting to grips with how this popular chatbot can enhance their workflows.
But Zavvy's Head of Learning Science, Veronika Schäfer, shares seven practical ideas for using ChatGPT in HR:
- Create employee feedback questions.
- Help colleagues to phrase their feedback.
- Write HR policies.
- Produce a list of keywords for a job description.
- Write a full job description.
- Draft a LinkedIn outreach sequence.
- Collect interview questions.
➡️ HR action: ChatGPT is innovative and impressive but far from flawless. The technology can and regularly does make errors, so always fact-check its output before you add any generated text to your company policies. Also, while adding chatbots to your operations may improve your efficiency, remember they're no replacement for human experts.
🦾 Dive into a more in-depth discussion of the use cases (and limitations) of ChatGPT in HR.
🙌 14. Reimagining the role of CHRO
The Chief Human Resources Officer (CHRO) role has evolved significantly, with a heightened focus on leadership, strategy, and ensuring employee well-being.
Sage research finds that 87% of C-suite execs credit people leaders with transforming a sea of practices since the start of the pandemic.
The CHRO has been at the center of managing employee productivity, leading discussions around policies and business continuity. Beyond that, C-suite execs also look to the CHRO to stay informed on employee health and safety protocols, remote work policies, and crisis management plans.
But more than that, CHROs are responsible for employee experience (EX), including:
- Fostering a positive company culture.
- Providing professional development opportunities.
- Ensuring that the organization's ESG (environmental, social, and corporate governance) initiatives align with its core values and goals.
Principal Consultant Chris Manning writes:
"Undoubtedly, employee experience is THE opportunity to create our new future of work. Employees' values and purpose has fundamentally shifted since the pandemic, meaning that employers need to quickly rethink their employee value proposition. This should always be designed by the people, FOR the people.
This EVP should then underpin the design principles of employee experience transformation to meet the new needs of the workforce. The critical piece though, is creating infinity loops of iteration to maintain relevance. The possibilities to innovate are exciting endless."
➡️ HR action: If your company doesn't yet have a CHRO or Chief People Officer, now's the time to change that.
A forward-thinking CHRO can help your business transition into the post-COVID era and create an employee experience aligned with your core values.
💡 Learn more about the role of a CHRO in our guide. And if you've already hired your new CHRO, discover how to craft a remarkable onboarding experience.
➡️ Embrace the future of HR trends with Zavvy
Zavvy is perfectly poised to adapt to the evolving trends in HR. Our suite of tools will support your CHRO, your HR team, and your entire workforce, boosting every aspect of the employee lifecycle. Try the following out for size:
- 🧭 Career pathing: enable fair progression by delineating clear A to B paths for all organizational roles.
- 🌱 Growth plans: boost company performance by giving employees control over their professional growth.
- 🔁 360-degree reviews: gather regular feedback from peers, managers, direct reports, business partners, and self-appraisals to provide a comprehensive overview of a reviewee's performance.
- 📊 Skills matrix: x-ray your people's collective and individual skills to grow your organization strategically.
- 🤩 Employee engagement: drive engagement by collecting regular feedback from your workforce using pulse surveys to understand employee sentiment and act on it.
➡️ Ready to learn more? Book a free demo with Zavvy today.