2
SHRM Workplace Forecast THE TOP WORKPLACE TRENDS ACCORDING TO HR PROFESSIONALS
The SHRM Workplace Forecast is
published every two years by the Society
for Human Resource Management.
The structure of the report is based on a
survey of human resource professionals
on the key issues they feel will affect the
workplace in the coming years.
The report is divided into four broad
sections covering demographics and
society, economics and employment,
public policy and law, and science and
technology.
The survey also asks HR professionals
what actions they and their organizations
are taking or are planning to take to
address these trends, changes and
challenges.
3
SHRM Workplace Forecast OVERALL TOP WORKPLACE TRENDS ACCORDING TO HR PROFESSIONALS
TREND MAJOR IMPACT
MINOR IMPACT
NO IMPACT
Continuing high cost of employee health care coverage in the U.S.
79% 20% 1%
Implementation of health care legislation 75% 23% 2%
A shortage of skilled workers 73% 25% 2%
Large numbers of Baby Boomers leaving the
workforce at around the same time 68% 29% 3%
Implications of the outcome of the 2012 [presidential and congressional] elections
68% 28% 4%
Lack of science, technology, engineering and math (STEM) graduates in the U.S. compared to other countries
68% 29% 4%
Decline in employees’ retirement savings 68% 29% 4%
Rise in fuel/gasoline prices in U.S. and globally 68% 28% 4%
Threat of a dip back into recession in the U.S. 67% 30% 4%
Greater economic uncertainty and market volatility 66% 31% 3%
Source: SHRM Workplace Forecast (2013).
4
SHRM Workplace Forecast: health care trends HEALTH CARE COSTS AND LEGISLATION AMONG THE TOP TRENDS
HR professionals have been concerned about the
high cost of employee health care for many years.
Rising health care costs was the top issue in the
Workplace Forecast surveys of 2005, 2007, 2009,
2011 and 2013.
HR professionals rated the implications of federal
health care legislation as the second most
important trend affecting the workplace and the
HR profession in the 2013 Workplace Forecast survey.
5
Health care costs How did your organization’s total health care costs change from last
plan year compared with the plan year before?
72%
19%
10%
74%
17%
9%
Increase
d
Remained
the same
Decrease
d 2013 (n = 366)
Note: Only respondents whose organizations provide health care were asked this question. Respondents who answered “not sure” were
excluded from this analysis. Percentages may not total 100% due to rounding.
Source: State of Employee Benefits in the Workplace—Health Care ©SHRM 2013
6
Health care costs
How concerned is your organization about controlling health care
costs?
83%
16%
1%
0%
84%
16%
1%
0%
Very
concerne
d
Somewhat
concerne
d
Not very
concerne
d
Not at
all
concerne
d
2013 (n = 411)
2012 (n = 437)
Note: Only respondents whose organizations provide health care were asked this question. Respondents who answered “not
sure” were excluded from this analysis. Percentages may not total 100% due to rounding.
Source: State of Employee Benefits in the Workplace—Health Care ©SHRM 2013
7
Health care costs Which of the following activities has your organization engaged in for the
purpose of controlling the costs of health care?
Activity 2013
(n = 417) 2012
(n = 405)
Provided educational initiatives related to health and wellness 45% 52%
Increased employee participation in preventive health and wellness initiatives
43% 44%
Created an organizational culture that promotes health and wellness
41% 45%
Offered consumer-directed health plans (e.g., HRAs, HSAs) 40% 42%
Increased the employee share contributed to the total costs of health care
39% 52%
Provided lower-cost generic prescription or over-the-counter drugs
39% 50%
Provided incentives or rewards related to health and wellness 35% 40%
Changed health care provider* - 3%
Other 7% 2%
Note: Only respondents whose organizations provide health care were asked this question. Respondents whose organizations had not conducted any activities to
control the costs of health care were excluded from this analysis. Percentages do not equal 100% due to multiple response options. An asterisk (*) indicates that
this response option was not asked in 2013.
Source: State of Employee Benefits in the Workplace—Health Care ©SHRM 2013
8
Health care: The Patient Protection and Affordable Care Act In your opinion as an HR professional, what is the biggest PPACA challenge
for HR?
1%
2%
2%
7%
11%
33%
31%
13%
1%
6%
4%
4%
6%
7%
8%
18%
20%
25%
Not applicable; we have not had any challenges as a result of the PPACA
Other
Keeping employees informed about the implications of the law
*Impact on health care plan design
Keeping track of when various parts of the law take effect
Determining impact on future total compensation strategy
The grey areas of the law
*Impact on health care plan costs
Understanding the details of the law
Keeping up with regulations and making appropriate preparations
2013 (n = 746)
2010 (n = 774)
Note: Percentages may not equal 100% due to rounding. An asterisk (*) indicates this response option was not available in 2010.
Source: Health Care Reform—Challenges and Strategies ©SHRM 2013
9
SHRM Workplace Forecast: Talent Shortages FINDING THE BEST EMPLOYEES IS ONCE AGAIN TOP OF MIND FOR HR
Key trends identified by HR professionals:
A shortage of skilled workers
Large numbers of Baby Boomers leaving the workforce at around
the same time
Lack of science, technology, engineering and math (STEM)
graduates in the U.S. compared to other countries
Overall decline in the workforce readiness of new entrants to the
labor market
Lower birthrates contributing to smaller pipelines of talent in
future generations
Decline in the number of foreign students who stay and work in
the U.S.
Source: SHRM Workplace Forecast (2013).
10
Future HR Challenges
59%
52%
36%
34%
33%
20%
15%
13%
11%
6%
51%
29%
44%
21%
41%
17%
33%
12%
24%
1%
Retaining and rewarding the best employees
Developing the next generation of corporate leaders
Creating a corporate culture that attracts the best employees to our organization
Remaining competitive in the talent marketplace
Finding employees with the increasingly specialized skills we need
Creating smooth and efficient HR processes that ensure a good employee experience
Finding the right employees in the right markets where we do business around the world
Creating an employee-centric, service-oriented HR organization
Breaking down cultural barriers that make it difficult to create a truly global company
Other
2012 (n = 483)
2010 (n = 465)
Over the next 10 years, what do you think will be the three biggest
challenges facing HR executives at your organization?
SHRM Future HR Challenges. © November 2012. Society for Human Resource Management.
11
Future HR Challenges
Over the next 10 years, what do you think will be the biggest
investment challenge facing organizations?
43%
22%
19%
14%
3%
47%
29%
11%
12%
2%
Obtaining human capital and optimizing human capital investments
Obtaining financial capital and optimizing financial capital investments
Obtaining technology and optimizing technological capital investments
Obtaining intellectual capital and optimizing intellectual capital investments
Obtaining physical capital and optimizing physical capital investments
2012 (n = 484)
2010 (n = 449)
SHRM Future HR Challenges. © November 2012. Society for Human Resource Management.
12
Post-recession recruiting difficulty is climbing back up SHRM LINE® RECRUITING DIFFICULTY: MANUFACTURING AND SERVICES
-40.0
-30.0
-20.0
-10.0
0.0
10.0
20.0
30.0
40.0
Jun
-05
Au
g-0
5
Oct
-05
Dec
-05
Feb
-06
Ap
r-0
6
Jun
-06
Au
g-0
6
Oct
-06
Dec
-06
Feb
-07
Ap
r-0
7
Jun
-07
Au
g-0
7
Oct
-07
Dec
-07
Feb
-08
Ap
r-0
8
Jun
-08
Au
g-0
8
Oct
-08
Dec
-08
Feb
-09
Ap
r-0
9
Jun
-09
Au
g-0
9
Oct
-09
Dec
-09
Feb
-10
Ap
r-1
0
Jun
-10
Au
g-1
0
Oct
-10
Dec
-10
Feb
-11
Ap
r-1
1
Jun
-11
Au
g-1
1
Oct
-11
Dec
-11
Feb
-12
Ap
r-1
2
Jun
-12
Au
g-1
2
Oct
-12
Dec
-12
Feb
-13
Ap
r-1
3
Jun
-13
Au
g-1
3
Oct
-13
Manufacturing recruiting difficulty Service sector recruiting difficulty
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Skills gaps: basic skills In general, what basic skills/knowledge gaps do job applicants have
in your industry?
9%
1%
2%
8%
7%
11%
18%
30%
30%
38%
48%
9%
2%
2%
8%
11%
13%
14%
29%
31%
38%
55%
Other
History/geography
Humanities/arts
Foreign languages
Technical (computer, engineering, …
Government/economics
Science
English language (spoken)
Reading comprehension (in English)
Mathematics (computation)
Writing in English (grammar, spelling, etc.)
2012 (n = 1,928)
2011 (n = 597)
Note: Percentages do not total 100% due to multiple response options. Respondents whose organizations were not having a difficult time
recruiting for certain types of full-time jobs were not asked this question.
Source: The Ongoing Impact of the Recession—Recruiting and Skill Gaps ©SHRM 2013
14
Skills gaps: applied skills In general, what applied skills gaps do job applicants have in your industry?
5%
19%
17%
21%
25%
30%
36%
36%
39%
41%
44%
54%
5%
18%
18%
21%
21%
29%
33%
34%
38%
41%
46%
53%
Other
Ethics/social responsibility
Diversity
Lifelong learning/self-direction
Creativity/innovation
Information technology application
Teamwork/collaboration
Oral communications
Leadership
Written communications
Professionalism/work ethic
Critical thinking/problem solving
2012 (n = 2,168)
2011 (n = 716)
Note: Percentages do not total 100% due to multiple response options. Respondents whose organizations were not having a difficult time
recruiting for certain types of full-time jobs were not asked this question.
Source: The Ongoing Impact of the Recession—Recruiting and Skill Gaps ©SHRM 2013
15
Skills gaps: the hardest jobs to fill Specific job categories for which organizations are having difficulty recruiting
72%
68%
78%
86%
85%
88%
83%
68%
70%
77%
83%
85%
86%
88%
Sales representatives
Skilled trades (e.g., electricians, carpenters)
Managers and executives
High-skilled medical (e.g., nurses, doctors, specialists)
High-skilled technical (e.g., technicians, programmers)
Engineers
Scientists
2012
2011
Note: Percentages do not total 100% due to multiple response options. Respondents whose organizations were not having a difficult time
recruiting for certain types of full-time jobs were not asked this question.
Source: The Ongoing Impact of the Recession—Recruiting and Skill Gaps ©SHRM 2013
16
SHRM Workplace Forecast: Employee financial concerns RISING LIVING COSTS AND LOW RETIREMENT SAVINGS
Key related trends according to HR professionals:
Underfunded pensions and the stability of the federal Pension Benefit Guaranty Corporation
Decline in employees’ retirement savings
Rise in fuel/gasoline prices in U.S. and globally
Rise in unemployment
Increased cost of living for U.S. employees
Rising retiree benefit costs
Rise in underemployment (job seekers who can only find part-time jobs or employees who are
in jobs for which they are overqualified)
Downturn in consumer spending
Rising higher education costs (impact on graduation rates, debt and availability of educated
workers)
Growth in the generational income divide (impact of higher education and living costs and
slower wage growth on ability of younger generations to save and invest)
Increased global competition for jobs, markets and talent
Employee concerns about job security (impact on turnover, engagement, etc.)
Employee wage stagnation across many types of jobs
Employee backlash against rising benefits costs
Growth in the income divide between high- and low-paid workers
Greater use of contingent workers (i.e., temporary/contract workers)
Source: SHRM Workplace Forecast (2013).
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SHRM Workplace Forecast: Employee financial concerns CHANGES IN RETIREMENT BENEFITS
90% 92%
29%
19%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
2009 2013
Defined contribution retirement savings plan Defined benefit pension plan
Source: SHRM 2013 Benefits Survey Report
18
SHRM Workplace Forecast: Employee financial concerns TREND IN WORKERS' EXPECTED RETIREMENT AGE
Source: Employee Benefit Research Institute and Matthew Greenwald & Associates, Inc., 1991-2013 Retirement Confidence Surveys
19%
31%
34%
2%
9%
0%
24% 25% 25%
2%
7%
9%
16%
21%
25%
7%
17%
6%
11%
21%
24%
9%
20%
6%
8%
16%
26%
11%
26%
7%
9%
14%
25%
10%
26%
7%
0%
5%
10%
15%
20%
25%
30%
35%
40%
Before 60 60-64 65 66-69 70 or older Never retire
1991 1998 2003 2008 2012 2013
19
SHRM Workplace Forecast: Economic Uncertainty ARE ECONOMIC VOLATILITY AND UNCERTAINTY THE NEW NORMAL?
Related trends identified by HR professionals: Note that several contradict each other!
Threat of a dip back into recession in the U.S.
Greater economic uncertainty and market volatility
Growing national U.S. budget deficit
Increased corporate downsizing and bankruptcies
Rise in unemployment AND Improved U.S. job market
Shift from a manufacturing to an information/service or knowledge economy ANDU.S.
manufacturing revival
Increased use of outsourcing of jobs within the U.S. AND Increased use of offshoring
Increased global competition for jobs, markets and talent
European debt/financial crisis
Business impact of increase in the value of the U.S. dollar
Downturn in consumer spending AND Upturn in consumer spending
Economic growth of emerging markets such as Brazil, Eastern Europe, India and China
Increased expansion of foreign companies into the U.S.
Increased expansion of U.S. companies into the global marketplace
Rise of small businesses as generators of job growth AND Reduction in the number of startups and
new small businesses
Growth of the world's middle class consumers
Rapid turnover and skills shortages in key offshoring destinations such as India, China, Brazil and
Eastern Europe AND Increase in business research and development investment in emerging
economies such as Brazil, Eastern Europe, India and China
Source: SHRM Workplace Forecast (2013).
20
SHRM Workplace Forecast: Economic Uncertainty Compared to 12 months ago, would you say your organization’s overall
financial health is improving, has not changed or is declining?
Source: SHRM The Ongoing Impact of the Recession Survey (2013).
9%
24%
25%
35%
7%
8%
26%
24%
33%
9%
7%
20%
22%
38%
13%
Significant decline
Mild decline
No change
Mild improvement
Significant improvement
2012 (n = 3,362)
2011 (n = 2,277)
2010 (n = 2,333)
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Responding to the trends Actions HR professionals are most likely to say they are taking in response to trends
Yes No Plan to
Using social networking sites for recruiting, employer branding and
other purposes 68% 20% 12%
Updating technology use policies for employees (use of social
networking sites, e-mail for nonbusiness use, etc.) 65% 21% 14%
Linking employee performance and its impact on the organization’s
business goals 63% 23% 14%
Changing organizational policy in response to federal and state
regulations 60% 22% 18%
Expanding the use of e-learning 59% 25% 17%
Using nondisclosure and noncompete agreements for intellectual
property 56% 40% 4%
Putting more emphasis on succession planning and people readiness 55% 24% 21%
Changing employment practices to minimize legal risk 54% 35% 12%
Hiring workers (or increasing size of workforce) 53% 37% 11%
Expanding the use of technology-based employee and manager self-
service applications 52% 30% 18%
Source: SHRM Workplace Forecast (2013)
22
Responding to the trends Tactics HR professionals are most likely to say they will use to respond to HR
challenges
4%
14%
11%
13%
15%
11%
21%
40%
29%
23%
47%
58%
7%
11%
11%
13%
14%
15%
17%
17%
24%
24%
26%
26%
37%
40%
Showing commitment to corporate social responsibility and sustainability
Providing employees better opportunities to use skills and abilities
Creating a highly inclusive culture that uses diverse perspectives
Developing human capital managers at all levels of the organization
Providing employees with recognition based on job performance*
Encouraging employees to make decisions and take risks
Offering latest tools/technology to maximize work efficiency and effectiveness
Creating a stimulating and attractive organizational culture
Providing meaningful work with clear purpose in meeting organization’s objectives
Demonstrating a commitment to employee development
Providing employees with opportunities for career advancement*
Offering a higher total rewards package than competitors
Maintaining a culture of trust, open communication and fairness
Providing flexible work arrangements
2012 (n = 486)
2010 (n = 449)
Source: SHRM Future HR Challenges Survey (2013)
23
Questions and discussion WHAT TRENDS ARE HAVING THE BIGGEST IMPACT ON YOUR ORGANIZATION?
Are there other trends not mentioned that you think are having a big impact on the workforce and on your organization in particular? What are they?
What kinds of actions is your organization taking to address some of these key trends?
Are you optimistic or pessimistic about the economy? Why?
Are you optimistic or pessimistic about the future of your organization? Why?
What about the future of the HR profession itself? Are there key developments that you think will influence the profession? What are they?