Human Resources State Of The Union

ARTICLE |  Human Resources State Of The Union

The human resources field has been steadily expanding for the better part of a decade now, with nearly 980 thousand HR employees spread out across the US by the end of 2023. This is a credit to the increasing realization that a dedicated people strategy, proper talent management, employee retention and appropriate communication can have on an organizations 1. mission and 2. financials.

Even in the face of numerous disruptions to the workforce of international scale in the intervening years, the number of human resources professionals on US payrolls is up about 70% from the approximate 575 thousand US HR workers that the US boasted in 2015.

Perhaps even more interestingly, the ranks of human resources executives are well-positioned to continue growing into the future in the near-term, at times seemingly in spite of and at times seemingly because of the increased pervasiveness of artificial intelligence usage across human resources departments - more on that below.

What follows are some of the more interesting data points we’ve put together to help tell the story of the human resources field as it is today as well as how it is changing.

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HR Execs are Doing More Moving Up Than Moving On

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While 2022 was a busy year for Human Resources professionals seeking greener pastures and obtaining positions with new companies in order to progress their careers, those numbers substantially normalized over the last year and are much more in line with the level of executive  inter-company movement we saw in 2020 and 2021.

It’s worth noting that January has consistently been the month during which produced the greatest amount of HR executive churn over the past several years. With January behind us already in 2024, however, if historical trends over the last couple of years hold true, the next human resources executive exodus will likely occur in April, with churn decelerating then throughout the summer and fall until the close of the year.

One of the main reasons that there has been a noteworthy decrease in HR professionals leaving their current jobs for outside opportunities may be the inversely increasing amount of internal promotions that have occurred over the same time frame. Between 2021 and 2023, the proportion of internal promotions relative to total executive movement increased by 20%, with internal promotions climbing to account for nearly 4 out of every 10 human resource executives that changed jobs/companies, etc.

Further, the data indicates that the trend toward internal promotion has been picking up speed over the past couple of years, with the proportional growth of internal promotions relative to all HR professional job movements increasing 3 times faster from 2022 to 2023 than from 2021 to 2022.

‘Chief Human Resource Officer’ is in and ‘Chief People Officer Is Out’

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It was trendy for a little bit, but just as the job itself has evolved significantly over the last 100 plus years, the various titles by which companies have referred to their human resource lead has organically shifted among various options including HRBP or Human Resources Business Partner, VP of Human Resources, Chief Human Resources Officer, and Chief People Officer, for example.

The title Chief People Officer (CPO) has been riding atop the popularity wave in recent years - consistently exceeding the next most popular alternative, Chief Human Resources Officer (CHRO), by a significant margin. Since 2022, however, CHRO has been trending upward and making up ground while CPO has been doing the exact opposite. As of 2023, Chief Human Resources Officer is nearly as common as Chief People Officer with CHRO  likely to overtake CPO as the most popular HR head title in 2024 if these historical trends hold true.

HR Job Postings Increasingly Reference AI

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Artificial Intelligence tools have become more and more commonplace across a wide range of applications in recent years, and the human resources field has been no exception, incorporating AI in various capacities including job application processing, automated applicant interviewing, employee benefits optimization, and job performance analytic assessments.

Accordingly, it is no surprise that the number of HR jobs postings that relate to AI have been rapidly on the rise as well. In fact, since the second half of 2021 when the moving average number of AI-related HR job postings and other HR job postings were last approximately on par, the AI HR job posts have grown a more than 75% margin over the HR job postings that don’t involve artificial intelligence. Clearly the continuing incorporation of AI within nearly every aspect of the human resources field has been gaining momentum and is likely to continue doing so barring some currently unforeseen disruption.

While AI is referenced in a lot of places, what it really means is better analytics for the most part.  The best examples include -

1. AI-Powered Recruitment Tools: These tools use artificial intelligence to streamline the recruitment process, from sourcing candidates to screening resumes and even conducting initial interviews. AI algorithms can analyze large volumes of applications quickly, identifying the most suitable candidates based on predefined criteria. This not only speeds up the hiring process but also helps reduce biases by focusing on skills and qualifications. In short, better analytics around screening applicants.
2. Employee Engagement and Sentiment Analysis: AI technologies are increasingly being used to gauge employee engagement and morale through sentiment analysis of internal communication platforms, surveys, and feedback tools. By analyzing text and speech for emotional cues, AI can provide insights into overall employee satisfaction and identify areas for improvement in workplace culture and engagement strategies. In short, better analytics around surveys and feedback.
3. Predictive Analytics for Talent Management: AI-driven predictive analytics are being utilized to forecast future employee behaviors, such as the likelihood of an employee leaving, potential future leaders, or identifying skill gaps within the organization. This allows HR professionals to proactively address issues, plan for succession, and ensure the workforce is aligned with the company's future needs. In short, better analytics around talent management.  
4. Automated Employee Assistance and HR Bots: Chatbots and virtual assistants powered by AI are becoming more common in addressing employee queries, providing information on HR policies, benefits, and procedures, and even assisting with personal development and training recommendations. These tools offer employees 24/7 access to HR support and can significantly reduce the administrative burden on HR departments. In short, well - this one is large language model related and the term AI fits well.
These analytics / AI applications reflect the growing trend towards leveraging technology to enhance HR functions, improve the employee experience, and make data-driven decisions in managing human capital.

What are important HR micro-trends over the next 3-5 years?

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We will skip the buzz words, as you can see above they started to proliferate through job postings. Going one level deeper, and actual impacting the day to day, below are four major trends we are keeping an eye on. New technologies will evolve in this space, strategies are already in place in many companies we talk to and we will move from the second inning to later in the game with the below items.

1. Widespread Adoption of Remote Work Technologies: HR departments will increasingly adopt and refine technologies that support remote and hybrid work models. Tools for virtual on-boarding, engagement tracking, remote team building, and online performance management will become standard. HR will need to ensure these technologies are accessible and user-friendly to support a distributed workforce while maintaining team cohesion and company culture.

2. Micro-Credentialing and Continuous Learning Platforms: As the pace of technological change accelerates, there will be a shift towards micro-credentialing and continuous learning platforms. HR will integrate these platforms into employee development programs to offer short, focused courses that provide specific skills or knowledge, allowing employees to adapt to changing job requirements quickly and efficiently.

3. Expansion of Employee Self-Service (ESS) Platforms: Enhanced Employee Self-Service platforms will become more common, allowing employees to take charge of their personal information, benefits management, and learning and development activities. These platforms will offer more personalized experiences, using AI to recommend training, predict employee needs, and facilitate career development paths.

4. Utilization of Predictive Analytics in Talent Acquisition: HR will make more extensive use of predictive analytics for talent acquisition, going beyond traditional hiring criteria to include variables like candidate potential, team fit, and future performance predictions. This approach will help HR departments to not only fill positions more effectively but also to anticipate future hiring needs and reduce turnover by identifying candidates who are more likely to succeed and stay with the company long-term.

These specific changes indicate a shift towards more personalized, technology-driven HR practices that not only streamline HR operations but also enhance the employee experience and contribute to the organization's strategic goals.

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