2023 Talent Trends: The New Talent Economy is Real. Here’s How to Prepare for It.
Life sure comes at you fast. Just ask any CHRO who is dealing with what has to be the strangest labor market in decades.
If you had asked me a year ago to predict what the employment situation was going to be like in 2022, I wouldn’t have said that talent would still be so hard to find. Businesses were already feeling the talent shortage pinch in 2021, sure, but to think it would be sustained so deeply into 2022? I doubt anyone saw that coming.
Job openings plunged by more than 1.1 million in August. Despite that, vacancies remained above 10 million for the 14th straight month, according to the latest figures from the Labor Department.
With 1.7 job openings for every unemployed person in August, the supply-demand imbalance in the labor market remains above its historical average.
So bottom line: people are still feeling empowered to pick and choose jobs that make sense to them, that fit their lifestyle and values — not necessarily to just pay the bills. While that’s great for candidates and employees, it’s having a profound impact on organizations.
The Buzz on the CHRO Grapevine
After speaking with CHROs of several big companies, what I’m hearing from them is the ongoing pressure of hiring people at the right pace with the right skills isn’t likely to let up anytime soon.
How does this bode for the new talent economy in 2023, where values, motivations, connections, purpose, and world view are being redefined and played out on a whole new grid?
The tectonic talent shift is challenging HR leaders to think differently — to fundamentally look at themselves as needing talent, not talent needing a job. So less top-down, old school management style; but rather a more equitable sense of partnership.
You can imagine how this is causing sleepless nights for CHROs. Based on my conversations with them, I’d like to share some of the top talent trends I’m seeing and how you can prepare for those trends in your business next year.
Tackling the Big Talent Trends of 2023
1. Speed and accuracy wins
Think rapid recruiting. Talent isn't waiting two weeks for a job interview. They want a job and they want it now. This quaint notion of multiple interviews over several days with different members of the hiring team is too slow. I was talking to the CHRO of a huge retailer who shared this story with me. The CHRO walked into one of the company’s stores and the team leader said, “Well, I don't really like to interview so I only meet with candidates from 11-2 on Thursdays.”
Really? That approach might have worked in the past, but it’s not going to cut it anymore. Today it’s about speed without sacrificing quality.
Consumer-oriented experiences (think Amazon or Netflix) used to be the goal; now it’s the expectation. The only way to accomplish it is to “know the fit” and utilize AI-powered tech and automation to speed up your process and support leaders to make great hires — all while providing amazing, hyper-personalized experiences to candidates.
My advice: Know the fit and make the offer. Rapid recruiting is the trend that you have to master or you will lose the talent game.
2. Talent acquisition is talent management
The old belief system is that you start a job by putting your head down, work hard for a few years, and then eventually you ask if there's another job where you can grow your career. But today, I see it as a seamless desire to join a company and plan your career from day one, so candidates can see their career growth as they onboard.
Companies should welcome this change. The first day in a new company is no longer, “Here’s your corporate ID. Fill out your W-2.” It’s “Welcome aboard and here’s how your career can grow over the next five years.”
My advice: Disrupt old beliefs. Be inspired by young professionals’ drive and join the experience by creating a measurable and inspiring path for career growth and development for your people. AI empowers people at all levels of an organization to map out their careers.
3. Lifestyle is the new work style
See your employees as whole, unique individuals with lives outside of work. Empower them via their jobs. It’s no longer about the corporation as the center of the universe with ping-pong tables and craft beers on Thursday afternoons. Those things are fine, but Covid blew the lid off the idea that work is the center of the universe.
Recognize that your people work to live, not live to work. Create options for them to care for their families. Bring pets to the office. We are defining a new lifestyle contract to create work environments that allow people to do their best work.
My advice: Banish nostalgia! Make this a larger conversation than ‘back to the office!’ Survey your teams, find out what they value, and what earns you loyalty. Challenge long-held beliefs that “butts in seats” is more productive than new ways to work. Measure productivity. It’s not about what makes leaders feel better, it’s about the outcome and quality of work completed.
4. AI is everywhere
Your talent experience platform must have AI tools to automate and personalize the experiences for not only candidates and employees, but recruiters, managers, HR, and HRIS teams as well. This should be obvious by now, but many CHROs still lack the understanding that AI isn’t making personnel decisions, AI is simply supporting and informing decisions faster and more accurately. Leaders make the decisions; AI provides the objective data to help us get there.
AI simplifies the hard. It automates the redundant. It personalizes the journey of each person who interacts with your company. Machine learning delivers quality, quantity, and speed.
This ties back nicely to point #1 about rapid recruiting. That trend can only be empowered by this trend — AI is everywhere.
My advice: Take the time to get informed on the impact of AI at work. Understand what it is, how it works, and how you can implement and win the talent game.
5. Combine purpose and profits
The two aren’t mutually exclusive. I was blown away when the founder of Patagonia, the outdoor apparel maker, basically gave his $3 billion company away to the planet rather than sell it or take it public. Here’s a reluctant billionaire who ran a successful company without sacrificing a passion for the environment.
Carmakers have made the existential decision to embrace electric vehicles. They know that if they stay rooted in combustible engines, they’re dead in the water financially. AI is accelerating that transition with pure data, allowing people to make educated decisions about powering the grid beyond burning coal.
HP’s CEO says Environmental, Social, and Governance (ESG) policies give the firm a competitive advantage to attract top talent. He says HP won $3 billion in deals last year because of its sustainability practices – that’s three times more than what HP saw the year before. So the ROI is there.
This is a new and important trend. Leaders of business are thinking and planning with their head and heart and being rewarded greatly for it. Gen Zers are planning their careers not just around joining a stable company that pays well. They are also evaluating that company’s footprint around sustainability, DE&I, local investment, and the purpose of the company beyond profit. Combined, visionary leaders and an empowered workforce create a new world of work that just might save us all!
My advice: The supreme good is like water — it nourishes all things without trying. How’s your company doing in pursuit of a supreme, altruistic good? Challenge your organization if it’s falling short.
6. Mental health = corporate health
The soft skills — empathy, curiosity, listening — are key to a company’s growth mindset. And they will only grow in importance in the new talent economy. These personality traits and behaviors help people flourish in their jobs, which in turn raises productivity.
Numerous studies bear this out. Employers in one survey were asked to name the top skills they wanted in employees — dependability, collaboration, flexibility, and problem-solving were the top traits. These are the skills that don’t show up on a resume, but are nonetheless vital to an organization’s success.
That brings me to my next point on this trend: leadership development. Leaders — whether they’re aware of their influence on others or not — hold a good deal of sway over the duress or the ease by which people interact with themselves and others.
Phenom’s senior executives, for example, attend meditation retreats to practice and hone the skills they need to be better leaders.
My advice: Companies go in the direction of leadership. People don’t leave companies, they leave leaders. Leader development is critical in the new talent economy. Know how to hire leaders and then invest in their growth.
HR Needs are Business Needs
An undeniable fact of the new talent economy is that HR needs are business needs.
So, do any of these half dozen trends resonate with you? I’d love to know what you’re seeing out there. People no longer want to go to work; they want to grow in work.
My challenge to every hiring leader out there — is your organization ready to meet talent where they are?
If not, then let’s talk.