What challenges will HR departments face in 2020?
AI scandals, productivity hits and cultural shifts – what obstacles should HR expect to face in the year ahead? Brian Kropp, Chief of HR Research at Gartner, gives his predictions...
We are undoubtedly living through a period of unprecedented change. Technological progress in all corners of daily life is bringing dramatic shifts to the way people engage, consume, communicate – and, especially, the way they work.
As we draw closer to the beginning of a new decade, it seems obvious that new developments, such as the widespread implementation of artificial intelligence (AI), will shift the talent and recruitment landscape drastically. Issues such as the disruption of blue-collar jobs, and the imminent need to re-skill vast numbers of employees, have been much discussed.
We’re also facing lasting impacts from recent political disruption – not least of which is the domestic and international wrangling of the terms of the UK’s departure from the European Union – which are just starting to materialise in the British labour market.
Given these factors, what can we really expect in 2020 and beyond? Here are my predictions...
Prediction: The use-ethics of AI will become a major flashpoint
In recent years, across a suite of talent management processes, leading companies have substantially increased their use of AI technologies. Within an HR context, this use has evolved from a tool aiding recruitment processes – such as helping to sift databases and CVs for applicable skills among higher quality candidates – to providing an integral framework for several core HR functions.
Now, AI is used in everything from determining and distributing compensation to aiding decision making in promotion and lay-off periods.
This increased usage has, however, not necessarily been met with increased levels of understanding or expertise. Organisations may be spending more on AI; but, realistically, not all decision makers will fully understand the technology at hand. As such, it’s reasonable to expect that the decision outputs of these technologies will begin to create complex ethical challenges – resulting in unprepared companies being troubled by scandals.
Some organisations are exploring the use of algorithms to suggest compensation increases, making use of machine learning to determine the comparative value of employees’ output and rewards.
However, in cases where artificial intelligence systems base assumptions on patterns of historical data, there is a danger that any gender or diversity pay gaps will be perpetuated. While organisations may be keen to fix pay inequity, they must ensure their technological solutions don’t reflect historic organisational bias, leaving female employees – for example – worse off.
The simple fact is that some businesses are becoming so dependent on algorithms that they fail to parse the data properly. We expect that, in 2020, the use of AI in areas where there are current issues of systematic bias or ethics could lead to a risk of substantial fines and reputational damage.
The impacts of these issues will not simply be fiscal – but, as they are guaranteed to be well-publicised, they could severely harm an organisation’s Employee Value Proposition.
Prediction: Tech talent will become more accessible to non-tech companies
While it is true that the tech sector has monopolised the hiring of most fresh tech talent across the last decade, we expect this trend to shift in 2020 for two reasons.
The first reason is financial: many of the largest and ‘hottest’ employers of tech talent are not actually in a position of great-enough financial stability to maintain the number of tech employees they currently have. Particularly if the UK economy continues to be hit by political uncertainty and the global headwinds of trade wars, financial losses will continue to pile up for these companies.
To cut their losses and slide to a more sustainable financial position, organisations will be forced to reduce their headcount of highly paid tech specialists.
Second, the average age of tech employees is increasing. In 2010, the average age of an employee working at a tech company was 35. Now, it is just under 40.
As these employees age, their value proposition for working at a particular company will also change. As millennials grow older and enter life stages where their concerns change – i.e. having children and a mortgage – they will become more interested in working for companies that are more stable and less risky.
As such, we expect to see more specialised tech talent turning away from the high-stakes start-up environment, to more traditional organisational models.
Prediction: Political developments will continue to hit productivity
Between the UK’s imminent general election, ongoing soul-searching with Brexit and struggles with climate protests, the British economy is already beginning to show marked wear-and-tear from the political events of 2019. As detailed in a recent Financial Times article, UK private sector activity showed signs of continued decline at the beginning of Q4 2019, with companies citing continuing Brexit and domestic political uncertainty as the primary cause of sluggish output.
Our research at Gartner shows that the average UK employee now spends around 25 minutes per day worrying about Brexit. This will vary, of course. Some EU employees, for instance, whose families and close friends may be particularly disrupted by policy changes, would report an even larger amount of time spent in concern.
Across the whole of the UK labour force, this equates to millions of hours of productivity time lost. We expect this hit to business output to continue – especially given the unpredictable and disparate policy outcomes of the eventual general election result.
Prediction: Remote working will continue to become the norm
Over the course of the past two or three years, many organisations have begun to offer flexible working practices as a core benefit designed to attract talent. This has been a shift facilitated by both improved technology, as well as increased employee demand for working practices respectful of individual circumstances. As such, flexible working – formerly, a differential benefit allowing the odd day at home – is now firmly the norm.
We predict that, in 2020, companies who still lag behind will need to respond by offering more opportunities for employees to work remotely. In fact, in 2020, we expect the ratio will flip to more than 50% of employees at least occasionally working remotely in a typical week.
Managers must not resist this cultural shift, and instead work with HR leaders to find technological solutions to support employees’ professional lifestyles.
The coming of age
In 2020, we expect that the use of technology in HR practices will truly come of age – a development that should be welcomed as a way to more closely align the world of work to changing cultural norms.