4 Important Workforce Trends to Expect in 2023

It’s often said that we have been living through “unprecedented times.” In the world of work, this is no different: longstanding assumptions about how, where and when Americans must work have been upended since the pandemic began.

2022 was another year in which employers and workers saw dramatic shifts in workforce culture. Traditional, old-school expectations about how a job gets done are being reconstructed — and cutting-edge employers that want to attract and retain talent are introducing strategies to keep up.

Innovative, inclusive, and successful companies will need policies and procedures that meet workers where they are in order to stay competitive. This coming year, we expect to see core shifts in how employers are thinking about how to enhance remote and hybrid equity, DEI approaches, people analytics, and professional development opportunities for workers.

If we had to define a core driving force behind workers’ expectations this coming year, it would be flexibility. Flexible work arrangements — whether in terms of timing or location — are no longer seen as a “nice to have” perk. They are a baseline assumption.

Nearly half of US employers are maintaining some form of remote work, according to a 2022 report by FlexJobs, a site for remote and flexible job opportunities. Roughly one in four companies surveyed said that employees will be allowed to work remotely post-pandemic.

Meanwhile, most employers are meeting workers somewhere in the middle. Roughly 60 percent of businesses are encouraging a hybrid return to office setup, writes Jessica David in InformationWeek. This approach is necessary: more than eight in 10 workers surveyed by Accenture saw a hybrid model as ideal, according to research from 2021.

This model is also projected to grow. The hybrid work model is expected to nearly double — from more than 40 percent in 2021, to roughly 81 percent in 2024 — according to an AT&T Business report.

Beyond simply offering such options, employers must execute them equitably. Already, research has provided insights about the pros and cons of flexible work. On one hand, remote and hybrid work have led to better productivity, greater focus on employees’ wellbeing and time saved. On the other, this shift has exposed weaknesses in some companies’ technology and has reinforced the need for stronger communication to build trust among colleagues.

We’ve also learned that remote and hybrid work can help move the needle on improving DEI, whether that’s reducing microaggressions or pressure to code-switch. This coming year will set the stage for more nuanced and deeper conversations around various dimensions of hybrid equity.

It will become even more crucial for companies to ensure they’re not favoring in-office workers for promotion, mentorship or advancement. It’s also key that employees don’t feel pressured to appear in-office or resent colleagues’ remote privileges if the option isn’t available to all, writes Alexandra Samuel, an expert on remote work and the digital workplace.

Employers need to prioritize building a sense of connection and providing support for remote and hybrid workers in dynamic ways. This could entail collecting and monitoring data to track key metrics. It also could involve facilitating new programs to maintain communication, bolster culture, and measure employee productivity in unconventional ways.

Expanding DEI has continued to be a top priority for employers this year. In 2023, we expect companies to proactively source and hire talent from pools that have historically been underutilized. First and foremost, sourcing from a wider range of communities is the equitable thing to do. And from a pragmatic standpoint, employers can’t afford to ignore overlooked populations any longer as competition for top talent grows and available labor pools shrink.

Research suggests that competing for talent is top of mind for HR experts. 50 percent of HR leaders expect increased competition for talent over the next six months, according to research from Gartner, a technological research and consulting firm. More than one in three HR leaders surveyed say their sourcing strategies aren’t sufficient for finding the skills they need.

A plethora of underemployed workers are eager, ready and prepared to join the labor force in this key moment. This includes justice-impacted talent, or individuals with criminal records. One in three Americans has a criminal record, according to the National Conference of State Legislatures. As more employers implement fair chance hiring practices — which involve accounting for candidates’ criminal records only after they have been interviewed and are considered qualified for a role — talent pools will grow to encompass the more than 70 million Americans with a criminal record.

Similarly, rates of older workers in the workforce are growing. As the number of aging adults in the US population continues to surge, hiring older workers will be paramount for employers.

Another untapped talent pool is people with disabilities, who make up an estimated one in 10 Americans and have long faced barriers to employment and inclusion in the workplace. Historically, the unemployment rate among people with disabilities has hovered around 65 percent — significantly higher than the national unemployment rate, according to The Arc. However, employment among workers with disabilities has been rising since employers began making widespread accommodations during the pandemic, such as remote work. The population of disabled workers will continue to grow as Americans with long COVID need workplace accommodations — and employers on the forefront must be prepared to meet those needs.

In 2023, the role of HR analytics will become critical to driving bottom line business results.

People analytics have been central to successful HR programs in recent years. However, companies are on the brink of refining — and significantly enhancing — these tools.  Less than one in three HR professionals rate their analytics skills as expert, but more than three in four believe it’s an important skill for the future, according to research from Sage.

In 2023, HR software will become essential to glean more sophisticated insights that influence the choices leaders make. 94 percent of business leaders in a recent Sage survey reported having access to some form of people data from HR. But 60 percent of C-suite executives said they’re not using such data to drive decision-making, according to Sage.

People analytics will evolve beyond just data reporting and collection to shaping strategy. What’s more, continued automation will help free up time for HR professionals to spend on the people-driven decisions and leadership initiatives that matter most. This could include a growing focus on improving diversity, employee engagement, and retention metrics.

While interest in these tools is rising, financial investment ultimately will determine to what magnitude. 67 percent of HR leaders want to invest more in HR tech in the future, but 36 percent see lack of investment from the company as a barrier, according to Sage.

Workers’ priorities have been shifting since the pandemic. Now, more employers are finding that employees want companies to invest in learning and development opportunities. Many workers are less interested in climbing the traditional “corporate ladder” but instead want to climb the “skills map” — by collecting a wide array of experiences across industries and roles that will serve them throughout their careers.

65 percent of workers believe employer-provided upskilling is very important when evaluating a potential new job, according to research from Gallup. The same study found that 48 percent of American workers would switch to a new job if offered skills training opportunities. And career advancement is the top reason people change jobs, according to research from LinkedIn.

Development and upskilling will not only attract top candidates — it also will internally benefit organizations with everything from spurring innovation to promoting equity.

LinkedIn’s Workforce Learning Report states that 93 percent of employees would stay at a company longer if it invested in their careers. And organizations with a strong learning culture are 92 percent more likely than their peers to develop novel processes and products, according to research from Deloitte.

What’s more, upskilling or reskilling enhances workers’ ability to perform. For example, upskilling on cross-cultural communication promotes DEI while helping to foster better communication and synchronization between colleagues.

Employers are at an inflection point. Amid economic uncertainty, rapidly changing workplace norms, and a competitive labor market, companies that drive “the future of work” will be those innovating and refining processes to prioritize building diverse, representative teams.

As 2023 unfolds, we will be watching to see how employers foster remote equity, source untapped talent, build out people analytics and bolster development opportunities for workers.