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Top 6 HR Trends of 2023

Updated: Jan 31, 2023

The abrupt and prolonged arrival of the pandemic has forced companies to develop an entirely new approach to work and accelerated workplace trends, and there is good evidence to suggest that the policies enacted during that period will become our new normal. Whether it be the incorporation of remote working, the adoption of technology like cloud based systems and automation, or the evolving responsibilities of HR, we will discuss these 6 HR trends which you are likely to see in 2023.

Make this the year of flexibility

The presence of lockdowns and other anti-epidemic measures put in place for more than two years have seen companies getting used to remote working, and are unlikely to look back as they see the benefits of this mode of working such as increased productivity and is the preferred style of working according to the majority of employees globally. It is likely we will see a continuation of remote working on some days even after the pandemic procedures have ended. PwC, an international consulting firm, conducted a global survey to evaluate the future of the workplace. Out of 53,000 participants from 44 countries, More than 1000 employees are working in Hong Kong. The results are quite staggering. 9 out of 10 Hong Kong employees prefer having the choice to work from home. However, only approximately half(45%) of the 1000 surveyed currently have the option to work from home.

Companies in Asia are catching on with the trend of remote working, which rose to popularity amidst the covid-19 pandemic. Hong Kong conglomerate, New World Group(新世界集團), experimented with this idea by offering its employees a 4 and half day work week with the option of working away from their desks on the 5th day for 3 months, from July to September in 2022. The “Summer Fridays Programme” allowed employees to work only 4 and a half days(with one of those days being away from their desks if they so choose) and take a half day leave on Fridays with no change in salary. While we do not think 4 and a half day work weeks will be the norm in Hong Kong, there is good reason to believe more companies will allow a hybrid working model in 2023 within their workplace.

Improvement of digital experience

As more companies shift towards a hybrid working environment, it is important that the supporting technologies allow employees to access data and information even when they are working away from their desks to ensure similar productivity and convenience can be achieved. To simulate the convenience of employees working in the same environment, more companies will opt for HR systems that are cloud based with a dedicated app on mobile, so HR tasks can still be completed as if nothing has changed. Employees can apply for leave, claim expenses, access payslips and tax forms as well as clock in/out to update their employers regardless of where they are working. The traditional on-premise method of deployment will be gradually phased out as they proved to be incompatible with a hybrid working environment. Companies are also moving closer to choosing a complete HR system over singular modules that require integration.

Adoption of automation

Companies are looking to automate more of their HR processes so HR officers can allocate more effort elsewhere. The most common HR tasks that are being automated include onboarding, recruitment and calculation of payroll, while the most important automation function in HR is perhaps the ability to automate compliance activities. For example, the automatic deduction of salary for MPF purposes in the calculation of payroll, or the tracking of employee working hours to prevent the 418 law being triggered, which is helpful for companies in industries like retail or hospitality which hire a lot of part time workers.

Redefining the role of HR

As more and more administrative tasks are being taken care of by HR systems, the responsibilities of HR are being shifted towards strategic planning, which involves more humanistic skills like creativity and intuition, and cannot be replicated by AI, such as improving employee retention for new and current employees by creating an attractive corporate image and company culture. One way to achieve this is to prioritize employee well being and mental health. The PWC survey revealed that over 85% of all participants think companies should actively manage employee well being, while only 35% of Hong Kong companies have such policies in place. As the pandemic ends and the economy opens up, one can expect the job market to get increasingly competitive. The HR department will be tasked with attracting the biggest talents.

Advanced employee analytics

The digital transformation of HR will not stop at implementation of cloud HR systems, but will seep into the use of big data to analyze employee data. Big data refers to the collection of a large quantity of employee data for evaluation and analytical purposes regarding key HR practices like recruitment, talent management, and training etc. The most efficient way to collect big data in HR is through an integrated HR system where attendance, leave requests, appraisals, employee profiles, and all the data associated with these modules are on one platform. The collected data would then be compared against each other, and/or against standards set by organizations. For example, a company may set an acceptable absentee range and put collected data against this standard. Some common types of HR data collected for analytics include: Recruitment cost to hire, Turnover(the rate employees are leaving), Time to hire(amount of time between a job posting and the actual hire), Absenteeism(time away from work), and engagement rating. Insights gained from HR analytics will be factored into decision making: if data suggest the hiring process is too long and the company discovers their recruitment posts have low engagement, they can consider creating posts that better communicate their company culture and set more appealing benefits.

Promote from within

A positive outcome from organizations investing more resources on internal skills development and training is more promotions will come from within in 2023. The benefits of reskilling and upskilling current employees is that it will empower them to progress in their own fields, will promote job satisfaction and increase retention rates for the company. The PWC survey revealed that almost half of the 1000 Hong Kong participants think their companies failed to provide opportunities for employees to work and learn from colleagues with high-tech/digital skills and training programs are lacking. Building up digital skills of employees is getting increasingly important as more companies become tolerant of a hybrid working model. More companies will take this approach in 2023, as investing in training and other retention strategies is ultimately more financially friendly than hiring or outsourcing talent.

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