New Year: New Dimensions to “Old” Problems
The following cheery outlook for 2024 is provided by Payscale. We will be on the lookout for other opinions, of course, but these issues promise to be in front of all employers as long as the current environment prevails. Their predictions for 4 different areas of employment for 2024 are the following:
1.“People Leadership and the Job Market:
Summary: The state of the labor economy is critical to human resources management as the supply and demand of labor directly impacts talent strategy and wages. Although we may see a recession in 2024, we are still experiencing a labor shortage and unemployment is not likely to rise high enough to shift the power dynamic fully in favor of employers. Instead, there needs to be a balance where employers cooperate with employees to create fulfilling work experiences that benefit both individuals and businesses.”
The health of the labor economy will fuel heated debate in 2024.
A recession in 2024 won’t override worker demands for work-life fit.
Labor unrest will continue and labor strikes and unionization will increase.
Mandating returns to office (RTO) will continue to be a struggle.
Benefits will become more inclusive and varied.
Human-centered recruiting will need to become a bigger focus to offset talent shortages.
2. Compensation Management and Equity-Based Pay:
Summary: Workers are increasingly concerned for their financial stability and overall wellbeing. As the cost-of-living rises, wealth inequality increases, and pay transparency reveals pay inequities, workers are changing jobs or embracing strikes to fight for better pay and benefits.
Real wages will continue to lag inflation, contributing to growing wealth inequality and unrest.
DEIB budgets and commitments will be contested as tensions rise in 2024.
Gender pay gaps still won’t close in 2024, driving the continued expansion of pay transparency laws.
Pay increases will remain strong, especially in sectors with more competitive talent markets, and there will be more focus on salary adjustments to keep up with market changes.
Skills valuation and career pathing will gain more prominence in pay strategy
3. Changing Legislation and Labor Standards:
Summary: Pay transparency legislation has caused a shake-up in compensation management — the biggest seen in some time. Expanding legal requirements will push employers to modernize compensation practices and standardize pay communications. In addition, possible restrictions around the use of AI in talent acquisition could create a whole new wave of legislative compliance required in 2024.
Pay transparency legislation will pick up steam globally.
Laws will expand to encompass pay communications and career progression.
New legislation may put guardrails on how AI is used in the talent acquisition process.
4. AI and the Future of Work
Summary: Generative AI has the potential to completely revolutionize talent acquisition — at least as far as legislation will allow — in an era where talent shortages and the need to upskill and reskill are becoming increasingly pressing. However, while generative AI (e.g., ChatGPT) made a big splash in 2023, HR and compensation professionals need to become better acquainted and comfortable with AI as a feature of compensation software — particularly how machine learning already enhances job management and market pricing and can be leveraged safely and fairly for other compensation-related workflows.
AI experimentation and adoption will expand and supercharge HR tech.
New AI-related jobs will emerge in every function and every industry and the race to hire AI talent will hike wages for AI-related skills and experience.
Forward-thinking organizations will provide employees with AI tools and training.
Advanced organizations will leverage AI to accelerate and improve compensation functions.
Organizations that don’t shift to AI working models in 2024 will fall far behind in the future.