I have been doing forecasts on the talent ecosystem for over two decades. I have based my forecasts on my observations, work with technologists in the talent space, conversations with colleagues, surveys, and my experience as a recruiter and HR executive.
Neither emerging trends nor technologies appear overnight or unexpectedly. Active observers can discern the long tail of emergent trends and the long tail that predicts the decline or morphing of a technology or an event.
The year 2020 was unique and seminal because of Covid-19 and the continued growth of artificial intelligence, high-speed video, lack of global mobility, high global unemployment, and changing work patterns.
A.I. has been creeping into recruiting software for several years. Sourcing, screening, and assessment algorithms are sophisticated and lead the way. Conversation bots (chatbots) and other engagement software as well as onboarding software all have significant A.I. components. The Coronavirus accelerated their adoption and sophistication. Organizations that had not considered these applications began to engage with them and many software firms saw large growth.
Workers who had been clamoring for flexible working hours and remote work were well rewarded. The virus made remote work mandatory overnight in what is perhaps one of the largest and most global experiments in working arrangements ever to occur. Although Zoom and Microsoft Office were available before the pandemic their growth was accelerated.
Zoom had 10 million daily users in December 2019, but by March 2020 they had over 100 million and soon after that 200 million users. Telework, telemedicine, tele-socializing, tele-everything has mushroomed and will most likely remain important into the future as we are familiar and comfortable with it and it offers convenience.
None of the trends here are unexpected or mind-blowing but are the inevitable result of the pandemic and will dominate our thinking and practice for the next 12-24 months.
1. People shortages grow
We all have a tendency to think in the extreme short-term. Almost anyone working for a corporation tends to think in terms of quarters or half-years when they should be thinking just as much about the longer term – the years or even decades ahead. They should have insight into their talent supply, workforce composition, and talent supply as well as contingency plans to ensure their competitiveness. But few have these insights or plans.
A sleeper trend that most of us don’t factor into our thinking is the slow but inexorable decline of the world’s population over the next decades. The world’s population growth is expected to slow significantly by the end of this century because of declining global fertility, according to the United Nations. Rather than rapid growth, countries such as Japan and regions such as Europe are in negative growth. The U.S. just experienced the lowest birthrate in its history, and demographers predict that this will continue. With negative growth over time come fewer workers, less talent to tap into or develop, and a much higher labor cost.
While recruiters cannot do anything about the growth of the population. They can encourage leadership to broaden job requirements to grow the potential talent pool. They can also encourage far more focus on development, apprenticeships, and job rotation schemes. As a senior vice president at IBM recently said: “By creating your own dumb barriers, you’re actually making your job in the search for talent harder.”
Forecast
There will as much focus on expanding the pool of candidates as on finding available talent. More organizations will put development on an equal footing with recruiting.
2. Mental health and safety become key employee concern
There is a great deal of trepidation among workers about returning to the physical workspace. With Coronavirus variants on the rise, incomplete vaccinations, and a growing lack of precautions, many workers are afraid to return. Organizations asking employees to return to the physical workspace are seeing turnover increase significantly.
Many employees and candidates are depressed , tired of isolation, and in need of social interaction. Employers and recruiters will face a challenge in retaining and recruiting people unless they find ways to make them feel safe. Many employees may also need counseling or other social services to become once again as productive as they were.
Employers need to create a healthy, and ethical workplace as well as establish compassionate policies around time off and flexible working hours.
Forecast
Recruiters will need to learn how to deal with the resistance or reluctance of former employees to return to work and for candidates to feel comfortable with the organization and its culture. HR and recruiting will need to develop new policies and more flexible approaches to everything from benefits and working hours to counseling and coaching.
3. RPOs grow in size, scope & importance
The RPO industry has seen double-digit growth every year since 2015, driven to some degree by the demand for talent that has put pressure on internal recruitment functions. RPOs have developed global operations and have the capability to source and recruit anywhere.
RPOs have grown in their ability to recruit both the volume roles and the more complex ones. RPOs can target candidates across various occupations, employment types, or vertical markets of specialists such as medical professionals, academics, or financial professionals. RPOs have developed complex, customized solutions for clients that are far more sophisticated than in-house recruiting functions can manage at scale.
They have invested heavily in technology and are using it to increase the speed to find and assess candidates and increase their quality. The use of technology has also let the RPO increase the volume and quality of candidates without increasing costs.
Forecast
RPO will continue to grow year after year and take over a larger share of the corporate recruiting space. Many internal functions may be disbanded or shrunk to very small levels as the capability of RPO continues to improve and grow.
4. New model needed for internal recruiting
The growth of RPO is a warning that all is not as it should be.
Today’s recruitment functions usually act too slowly, often lack knowledge about the business and the skills needed, and hinder efficiency with complex administrative systems. They do not meet the expectations of many candidates or hiring managers accustomed to fast service and prompt feedback. It is apparent that recruitment is a vestige of 20th-century manufacturing era organizations and needs to be radically disrupted as organized and chartered today.
Last November, my newsletter proposed a radical solution that included restructuring the internal function by breaking off part of it and making it a technology hub where technical experts could evaluate and install the technology needed to source, screen, assess, and hire. This would be accompanied by a cross-functional recruitment effort made up of various people assembled as needed for as long as it takes to recruit the needed people. There would also be a robust partnership with RPO as well as with learning and development. The full article can be found here.
Forecast
Internal recruiting functions will restructure around filling critical positions and will outsource more to RPO. Automation will increase, and HR technical specialists will be hired either as contractors or permanent employees to choose, integrate, and improve recruiting technology.
5. Reskilling and upskilling
We face similar challenges and opportunities to those the world faced over one hundred years ago as the Industrial Revolution swept through the world. The skills that suited the farm were not adequate for the factory, and thousands were displaced, unemployed, or were reskilled for the factory. This time automation is again wrenching apart the world we knew. Software, computer automation, artificial intelligence, machine learning, and the Internet of Things are displacing thousands of workers. Society is in a largely unrecognized upheaval. Manufacturing jobs will not return in any significant numbers; robotics will continue to grow and displace more workers. This will be especially significant in those jobs where physical presence is required. The Coronavirus has shown us how dangerous those jobs can be and underlined how robots can work without any concern for pathogens, viruses, or even climate change.
Without a significant effort to reinvent education and redefine what we need for future skills, we will face mass unemployment because we lack people with the skills needed for the jobs we need to be done by a human. We have to move from machine-age learning models to those that fit this new era.
The pandemic is one example of our uncertain future. Still, companies will be continuously faced with the events they didn’t plan for and couldn’t have anticipated.
An example is automotive manufacturing that was reluctant to switch to electric car production. Corporate leaders focus on today’s short-term problems and rarely have time to look at the future. When the market forces them to deliver something they’ve never delivered before, they falter and often fail because they have no one and no system ready to help.
As no one knows exactly which skills we will need, a culture of continuous learning is critical. If I can teach you quickly how to do something, I have a big advantage. People with a broad array of skills and knowledge – the ability to think critically and apply scientific, historical, ethical, and social perspectives to their decisions – are more likely to adapt to whatever needs arise and learn the skills they need quickly.
Google, IBM, Microsoft, and many other firms focus on hiring young people who have motivation, learning ability, and a cooperative mindset instead of narrowly educated technologists or engineers.
Forecast
Reskilling programs, apprenticeships, and other forms of hands-on learning will grow quickly over the next year or two. More and more firms will enlarge or set up learning centers and hire people with aptitude and motivation to train. One of the core roles of recruiting will be to partner with learning and develop guidelines on when to recruit for skills and when to hire to learn.
6. More Push Than Ever for a diverse, inclusive workforce
As the workforce slowly contracts, it will be strategically smart to reach a larger and more diverse pool of candidates. This year will be the beginning of a huge push to expand who we recruit, including minorities and people who would find it hard to work in a physical office. This includes the severely handicapped, older workers who cannot drive or travel, and those who live too remotely to commute.
One of the positive things to emerge from the pandemic is an acceptance of virtual and remote workers. The past year has proven that remote workers can be as engaged and productive as those who physically come to an office. Virtual, remote work opens the door to a vastly broader and more diverse candidate pool.
Forecast
Most organizations will reach out to more diverse candidates and offer them work and training. They will move beyond the traditional focus on minority groups and embrace a much wider array of people – the disabled, the elderly, the homebound, and those who cannot commute. This will also include the remote workforce and temporary and gig workers. Recruiters will need to expand their search capabilities and learn how to influence and recruit these various types of people.
7. Candidate privacy a major concern
Over the past year, we have had legislative initiatives, new rules, and much discussion on ensuring online privacy and respecting everyone’s right to control their own data. Facebook and other social media companies have faced scrutiny over the way they use and share users’ data without permission.
Forecast
There will be pressure on HR and recruiting to be transparent on how they make hiring decisions, what data they accessed to make the decisions, and whether or not candidates were informed and consented to share that information. This means that screening and assessment tools, including virtual interviews and background screening processes, will be questioned. Recruiters will have to be transparent about whether or not they used a Facebook profile, for example, to determine personality and how that factored into any hiring decisions.
8. Analytics central to success
This will be a year when analytics will become important to recruiting. Over the past decade, recruiting has dabbled in analytics, but they have rarely had access to the data needed to do valid reporting to say nothing about providing predictive analytics. They have generally reported lots of activity metrics, often gathered incompletely and of questionable accuracy, but very few metrics show effectiveness.
Metrics such as time to hire, requisitions filled, interview conducted, and quality of hire will fade in importance and significance.
Forecast
Recruiters will tap into larger and higher quality data sets generated by online chatbots, career sites, screening, and assessment tests.
A newer and far more useful set of metrics will emerge, using Big Data that answer questions such as who the most productive hires are, who has the skills needed, what skills are most important, or what makes a candidate say “yes.”
These eight trends only scratch the surface of the changes and problems we will face over the next 24 months. Recruiters need a flexible and open mindset. They need to experiment, be willing to advocate for new technologies and ways of organizing work. The ultimate goal should be to make recruiting obsolete through systems that keep the talent pipeline full and build the talent we need. The challenge is to make that happen.
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