Our clients are talking about balancing a large number of HR priorities and correspondingly complex budgets. As 2024 gets underway, which elements should you prioritize for the best HR ROI and the highest chance of success? These ten items are closely linked to some of the biggest trends currently defining Human Resources.
According to WTW research, U.S. employers plan an average salary budget increase of 4.0% in 2024. Salary raises should be an essential item in your 2024 budget, especially for rewarding current employees who have chosen to stay loyal during a job market that has been especially friendly to job seekers.
Training & Career Development
The Society for Human Resource Management found that employees are 76% more likely to stay at an organization if offered training and career development opportunities. Investing in the development of your existing talent is more cost-effective than continuous hiring, and it contributes to fostering a pool of committed in-house professionals with a deep understanding of your company.
According to the2024 National Business Trends report by the Employer Associations of America, talent acquisition ranks as the number-one concern among business leaders. Investing the time, energy, and money to make a compelling employee value proposition – ensuring the right candidates see it – will be critical to 2024 success.
2024 talent retention may prove to be even more critical than acquisition, mainly where budgets are concerned. Hiring someone to fill an empty position costs significantly more than retaining an existing employee, so focus on the factors that encourage employees to stay and thrive.
Regularly assessing and improving employee engagement can lead to higher productivity, lower turnover, and a more positive work environment. Investing in engagement doesn’t have to be costly, just strategic: conduct surveys that encourage honest feedback, maintain clear channels for feedback and communication, and develop action plans to address areas of concern.
HR Technology & Analytics
Fortune Business Insights projects that the HR technology market will grow globally from $23.98 billion in 2022 to $39.90 billion by 2029. HR budgets should allocate funds to improve efficiency, make the employee experience smoother, and gather and analyze data to make informed decisions about HR strategies and accurately measure their impact.
AI & Advancing Technology
Ernst & Young found that 48% of employees are more concerned about AI today than a year ago, with 75% concerned that AI will make some (or even their) jobs obsolete. Adopting AI in some aspects may help to streamline HR functions. Still, budgeting those dollars carefully is critical to ensure that technology adoption doesn’t negate other efforts, like employee satisfaction and loyalty.
Salary alone is no longer the primary deciding factor as to whether a candidate will accept a job offer (or stay in an existing role). In 2024, ensure your Total Rewards function in the HR budget, providing a comprehensive package that includes sought-after benefits like healthcare, flexible scheduling, and more, aligning with the preferences of today’s employees.
Health & Well-Being
Along with “traditional” health benefits like health and dental insurance, consider allocating some of your budget to support other elements of employee well-being. Gallup found that genuinely “thriving” employees are 32% less likely to seek a different job, meaning that employee well-being is intrinsically connected to rehiring costs.
Flexible Work Solutions
WTW reports that 55% of surveyed employers now offer a choice of remote, in-person, or hybrid work, while 31% offer a flexible work schedule. With more employees preferring some type of hybrid or flexible schedule, investing in ways to make it work can significantly boost your organization’s recruiting and retention efforts.