Addressing the Talent Shortage
While fears of AI-driven job displacement dominate headlines, the real crisis looming is a $8.5 trillion talent shortage projected by 2030. Much like the famous ‘invisible gorilla’ experiment, where viewers focused on counting basketball passes miss a costumed figure walking through the scene, businesses risk overlooking a crucial element: the Employee Experience (EX). To navigate the impending talent crunch, companies must shift their focus from the distracting ‘gorilla’ of AI job threats to the ‘basketball game’ of EX – the key to attracting and retaining vital human talent.
The top three HR priorities
According to SHRM, the top three priorities for HR professionals in 2024 include:
1. Maintaining employee morale and engagement (81%)
2. Retaining top talent (78%)
3. Finding and recruiting talent with the necessary skills (70%)
The results from the SHRM survey point to challenges with both recruiting and retention. In the U.S., an aging population, Baby Boomer retirement, and declining birth rates are contributing to a labor shortage. This makes it harder for employers to compete for scarce talent on the recruitment side and increases the pressure to retain talent. On the recruitment front, estimates suggest the average cost to hire an employee is $4,700, with many employers citing a cost to hire a new employee at three to four times the position’s salary.
To address, companies are turning their attention to improving EX.
What is EX?
EX is the sum of an employee’s experiences with a company. This includes everything from what initially attracted an employee to the company, to all the interactions with your company up through the individual’s last day. Given the scope of EX, it is not just the sole job of HR to improve the experience. Everything from the physical workspace, remote working capabilities, company culture, and interactions with coworkers, leaders, and HR plays a role in shaping the employee experience.
Key Focus Areas for Improving EX
With a multitude of focus areas, here are two to consider for improving the employee experience:
• Human-centered technology
• AI-infused HR experiences
Human-centered Technology
Digital and digitization plays a crucial role in shaping perceptions. When choosing HR technology, it is important to balance the features and functionality of the technology with the emotional needs of users. Whether you’re thinking about recruiting and applicant tracking, learning and development, or performance management, pay attention to how the technology enhances or detracts from the workplace experience.
Three questions to ask include:
1. Does the technology make it easier to complete the task?
2. Does the technology help get the job done?
3. How does the technology make the employee feel?
If your company is in the market for HR technology, a good place to start is to conduct employee journey mapping to understand employee needs, processes, and perceptions across key components of the employee lifecycle. By capturing the employee perspective, actions, and emotions, you can better understand technology needs and inform technology enhancements.
From a recruitment standpoint, this approach enables the creation of streamlined online applications. These user-friendly systems eliminate the need for candidates to both upload their resumes and manually input the same information, significantly reducing redundancy and improving the application experience. HR technology can also help candidates understand the overall recruitment process and where they are in the journey.
On the retention front, employee journey mapping can reveal pain points such as frustration with time-consuming compliance training. To address this, companies can modernize their approach by adopting innovative learning management systems. These systems leverage microlearning, storytelling, interactivity, gamification, and personalization to enhance engagement and efficiency.
Modern platforms offer ‘snackable’ content, delivered in bite-sized portions over time, eliminating the need for lengthy, non-skippable video sessions. Some even provide ‘test-first’ options, allowing employees to bypass familiar material, focusing only on areas where they need development.
By reimagining compliance training in this way, organizations can transform a traditionally tedious process into an engaging, efficient, and personalized learning experience, ultimately contributing to improved employee satisfaction and retention.
Not only will looking at HR technology in a human-centered way drive friction out of the employee experience, but it can also increase efficiencies and employee perceptions.
AI-infused HR experiences
In each stage of the employee engagement lifecycle, there are numerous ways AI can enable better experiences. Finding and retaining talent is both costly and competitive. To be successful, companies must excel across the entire spectrum of the employee journey encompassing all stages of the lifecycle.
Increasingly, HR teams are taking AI-infused approaches so they can focus on more strategic initiatives by reducing administrative work while enhancing perception.
The application of AI in HR:
• Attract and Recruit: AI is commonly used to identify candidates who may not have applied but have the right skills, to screen resumes, to schedule interviews, to conduct initial assessments, to provide personalized job recommendations, and to write job descriptions.
• Onboard: Some companies are shifting towards AI and virtual onboarding where new hires are onboarded through virtual replicas of their workspace where they can interact with their colleagues’ avatars, join team exercises, and learn how the organization operates. Early research on virtual onboarding has shown it to be more engaging than PowerPoint presentations, resulting in better retention of information over time.
• Develop and Retain: Outside of facilitating personalized training programs, tracking progress, and predicting churn, I believe AI can be used to create individualized, branded experiences for employees. For example, companies can leverage the concept of Amazon wish lists to create career wish lists that suggest classes, pair employees with mentors, provide suggestions for reading, recommend courses, and identify conferences to help employees explore and get closer to achieving their goals. To take this concept further, AI can be leveraged as a concierge service when paired with human managers to coach, mentor, and guide employees to the next level in their career journeys.
• Transition/Separate: On the transition and separation front, AI is being used to maintain positive relationships and minimize disruption during employee transitions.
Conclusion
In the quest to retain employees, building positive interactions is a day-to-day approach. By focusing on human-centered technology and infusing AI into HR, companies can significantly enhance EX. Employee loyalty is earned across each stage of the experience. This holistic approach not only helps attract and retain top talent but also ensures a more engaged, satisfied, and productive workforce. In the face of a looming talent shortage, prioritizing EX is not just a strategic advantage but a necessity for future success.
