HR predictions in 2023

The cycle of HR change & transformation shows no signs of slowing

The past several years have bought significant uncertainty for business and HR. As we enter the third year of this new decade, what will the top priorities for HR and business leaders be to accelerate business success in 2023 and beyond?

Sage HR have explored the leading predictions being made for Human resources in 2023 and beyond. 

🕐 Economic Uncertainty

Global economic uncertainty continues to unfold. Yet despite the bleak predictions being made of recession, a global survey of CEO’s conducted by KPMG, ‘The KPMG 2022 CEO Outlook’. Interviewing 1,300 CEO’s at businesses worldwide, disclosed that 58 percent of leaders anticipate that a global recession will be mild and short. Fourteen percent of senior executives more widely in the survey, highlighted a recession as being a leading concern for their organisations. 

DOWNLOAD KPMG 2022 CEO Outlook - Growth strategies in turbulent times | Source:
📥 DOWNLOAD KPMG 2022 CEO Outlook – Growth strategies in turbulent times | Source:

KPMG’s survey also indicated a strong majority of executives predicting that a recession of any size in 2023 will impact previously anticipated growth. In readiness for this, three-quarters of executives have already taken precautionary steps ahead of a looming recession.

For HR and business owners alike, the impact of any recession could be felt in redundancies and hiring freezes. As a result, both employees and employers are preparing themselves for yet more uncertainty, with HR preparing themselves for the actions required to minimise risk and maximise opportunities that save against resource budgets. 

The pandemic and the events in Europe have shown us how interconnected we are as a world

Furthermore, organisations are at risk of making changes to workplace flexibility and remote working. Considering this as being an answer to the issues felt in these challenging times. The tech sector, one of the leading verticals to previously embrace remote work, has already seen mass layoffs. With Meta and Twitter making significant reductions in their global headcounts. 

This shift has impacted what has previously been a balance of power tilted towards employees. Who in a formally constricted labour market, with vacancies outpacing qualified candidates, saw candidates enjoying high demand and a strong negotiation position on salary, work conditions and benefits.

However, it can be tempting for organisations to pull back on workplace flexibility and remote working. Yet doing so could still be an error in the long term employee and employer brand experience.  Offering work flexibility continues to have productivity advantages and is a virtually low to no-cost benefit that can deliver advantages for both employees and employers.

Recessions and economic uncertainty will not last forever. For HR and business leaders, taking this time in their stride whilst continuing to make good ‘people led’ decisions will pay dividends in the long run.

🕑 Predictions For DEI

One of several downsides to economic instability is when previously prioritised and much needed activities in the organisation slip from high to low priority.  Diversity, Equity and Inclusion (DEI) initiatives are at risk of becoming one such vital activity in organisations, seeing a downgrade in focus, as the economic downturn begins to bite. 

In 2023, HR and business leaders will be tasked with balancing the needs of reorganisation and restructuring. With initiatives that have been making progress in a previously under focused area. HR and people teams have however become the visible face of DEI initiatives and it’s vital that efforts continue despite the instability. 

As such, established and planned initiatives must continue to address issues of systemic inequity in organisations, and amongst leadership teams and organisational structures more widely. Bias and the tackling of unconscious bias will still require focus in 2023. For HR the continuation of root cause analysis and evaluation of existing policies and processes to understand bias emergence is critical to identifying resolutions. 

Problem awareness | Source:

HR and people leaders will be called upon to continue building their understanding of the organisation and the people within it. Tackling problems that the organisation has with Diversity, Equity and Inclusion, especially if there’s a misguided belief that their organisation has no issues to be concerned about.

🕒 HR Tech Trends

The HR tech market, much like several other key industries, is set to slow down in 2023. HR thought leader Josh Bersin, has predicted the slow down will counter what has, until recently, been a sustained period of rapid growth. 

HCM vendor satisfaction remains mixed | Source:
HCM vendor satisfaction remains mixed | Source:

The slow down in Mr Bersins’ view can be attributed to HR Tech spend in organisations starting to be cut back as economic change preparations evolve. In addition, HR tech is continuing to see some expansion in its product categories across areas that include recruitment and learning software. It is predicted that these areas are going to see a downturn in future investment. 

How will 2023 redefine work, the workforce, and HR? | Source:
📥 DOWNLOAD How will 2023 redefine work, the workforce, and HR? | Source:

Outside of these product categories, advancements in AI and virtual for HR tech are continuing at pace. All are predicted to play a larger role in the core focus fields for Human Resources; employee experience, productivity and learning and development. 

Gamification is another product development area being explored more widely in the field of web 2.0. Yet for HR, its advancements are being explored in employee engagement, and employee onboarding. 

It is predicted that Gamification will become one of the fastest growing trends in HR tech in 2023. The use and adoption of game-like features in non-game situations that can range using points, winning badges, and inclusion of leaderboards that can incentivise and encourage employees on reaching their performance metrics and goals. 

Gamification is also being leveraged in HR tech development to incentivise employees in developing new skills, enhancing their knowledge and increasing their qualifications in their respective fields.

🕓 Skills That HR Will Need In 2023

Sage’s report on the Changing Face of HR engaged and surveyed 666 senior HR professionals and 356 C-suite executives. The findings identified that despite the evolution of People professionals roles and responsibilities in the organisation over recent years. Human resources continues to be viewed as an administrative function by 63 percent of business leaders. 

The future of HR in 2024 Infographic | Source:
The future of HR in 2024 Infographic | Source:

Given this perception and the challenges that lay ahead for HR professionals in 2023, it’s evident that doing more with less. Whilst enhancing the perception of the skill set of HR will be wholly necessary. 

Leadership, credibility and data driven decisions are all skills that HR has long possessed. Yet in 2023 an increasing demand on these skills given market conditions and economic pressures will result in far greater focus. 

The legacy of the pandemic has resulted in HR being viewed, arguably more positively than perceptions previously. Surveys by People Management Magazine concluded that HR was now perceived as being more credible and respected, more visible, more influential and also the leading department to drive transformation.

With more on HR’s plate, resilience will be key

The skills that HR professionals will need in 2023 and beyond are in many ways a continuation of those that have been harnessed over recent years. The vital addition to these skills however, will be resilience.

Resilience in 2023 will become an essential tool in the HR professionals arsenal. This skill will hold significant weight as it’s widely appreciated that the mental health and wellbeing of people professionals has been impacted this past several years. Insights into this impact were uncovered within the CIPD People Professions Report in 2020. Yet the period following the report has been more turbulent for HR than many previous ones. 

Undoubtedly the skills of HR will always be called on to develop. The overwhelming majority of HR professionals remain optimistic about their roles and the future of Human Resources.

🕔 Workforce Planning Strategy In 2023

Resourcing and Talent planning in 2023 is set to become a mixed picture for HR. Following on from a period of extended challenges in recruitment across a wide number of fields. Workforce planning strategy will feature high as ever on the agenda for Human Resources.

The backdrop to 2023 talent planning has involved the Covid-19 pandemic and Brexit, both negatively impacting resourcing activities in the UK. The combination of challenges facing organisations has been increased by the pandemic in addition to a significant decrease in the number of overseas talent accessing the UK for employment. 

Technology use boosts candidate experience

The ongoing impact has led to a labour market that continues to shift. With increasing challenges in hiring and sizable gaps in skills and talent widening further across a number of roles.  

CIPD’s reporting indicates that in 2023 efforts to increase diversity, upskilling talent in-house along with leveraging flexible working arrangements will maximise on positive recruitment outcomes. 

Ultimately competition for talent is predicted to show no signs of slowing in 2023, despite economic instability. For HR, the challenge ahead for recruitment and growth plans is one to prepare for in earnest. 

Sage HR is the HR software solution of choice for businesses who prioritise people, growth and innovative thinking. Sign up to enjoy a free trial of Sage HR to find out more. 



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Written By

Jade Taryn Graham

Jade is the founder & CEO of Inspired a people & talent consultancy working with the most innovative early stage companies worldwide. Founder & CCO of Inspired Talent Media Ltd and contributing writer for Sage HR where Jade writes about people, leadership, work/life balance and change.