Navigating the 2023 Workforce Challenges: A Data-Driven Insight for Leaders

As we move further into 2023, many business leaders are optimistic about the future. The recovery from the pandemic has yielded new growth opportunities, technological advancements, and diversified business models. However, a recent study by Ceridian in partnership with Hanover Research suggests that there are impending “2023 workforce challenges” that could curb this optimism and limit the ability of organizations to achieve their business goals in the next year.

Main Findings

The online survey conducted included 2,020 leaders who are at the director level or higher across six countries and work for companies with more than 1,000 employees. Interestingly, when the results were compared to similar research from three years ago, many of the challenges remained the same. Some even appeared to have deepened.

A Closer Look at the Major Workforce Challenges

1. Internal Mobility: The majority of executives reported an increase in internal recruitment due to the effects of the pandemic. While this internal mobility can be considered a solution against labor shortage, it also represents a challenge in terms of skills development and retention.
2. Skills-Based Hiring: Most organizations now resort to skills-based hiring very often. While this may seem like an effective approach, it comes with its own sets of challenges, like aligning these skills with long-term company goals.
3. Contingent Workforce: A significant number of organizations are increasingly using contingent or contract workers. This trend adds a layer of complexity in terms of management and regulation.
4. AI Adoption: Leaders reported using Artificial Intelligence to replace repetitive tasks, potentially leading to a skills gap in the human workforce.

Recommended Actions for Overcoming 2023 Workforce Challenges

Simplify Internal Mobility

Facilitating easier transitions between roles within the organization can mitigate some of the challenges tied to skill deficiencies and labor shortages. Utilize effective talent management systems to identify internal candidates for role changes or promotions. The more forward thinking organizations are considering the concept of an internal career advisor to help support internal mobility programs as a key measure against workforce challenges.

Make Learning and Development Strategic

Learning and development should not be ad-hoc activities but a strategic objective. Investing in upskilling programs aligned with the organization’s needs can fill the skills gap in specialized technical skills, industry-specific skills, and even creative skills.

Optimize Use of Contingent Workers

While using a contingent workforce can be beneficial for specific tasks, it’s crucial to integrate these workers strategically. Companies need to develop frameworks for managing these workers efficiently while ensuring that they are aligned with the company’s long-term goals. Without proper integration and inclusion, using contingent workers can become its own workforce challenge

Drive Sustained ROI

Monitoring the return on investment (ROI) from workforce management strategies can provide organizations with actionable insights. Regular audits should be conducted to assess the effectiveness of various workforce optimization techniques, ranging from AI adoption to skills-based hiring. While this is not a common tactic in many HR organizations, it’s imperative that we begin helping our business units with this assessment. I find it is a great source of information for early indicators of issues and allows for more immediate, preventative measures.

Conclusion

The optimism that business leaders have about the future is well-founded but should be coupled with a realistic perspective on the impending 2023 workforce challenges. While the landscape is constantly evolving, taking calculated, data-driven steps to address skill gaps, enhance internal mobility, and make strategic use of both human and artificial intelligence resources will be pivotal for success.

By proactively addressing these challenges, organizations can not only navigate the complexities of today’s business landscape but also position themselves for future growth and success.