IT services companies have shown a drop in hiring in the second half of 2022 as compared to the first half and there have been delays on onboarding amongst the top employers of the country. This trend is likely to continue in the first half of 2023 but it is anticipated that in the second half positive momentum will be experienced, as per the estimates of Foundit.
Along with this, HR managers are likely to get less funds to spend on buying software or investing in new areas. What is also noteworthy is that the HR tech market which has ballooned in the last few years with around $15 billion investment, thanks to the low interest linked funds available to entrepreneurs and the massive hiring trends due to digitalisation requirements requiring IT support, is also now slowing down. In this context, the focus would be on critical areas that aid in business sustenance aligned with the likely areas of demand generation.
Therefore recruitment would be on just-in-time basis; there would be minimal bench or bench would be done away with completely. Preference would be for part-time or gig workers as far as possible and hiring of experienced staff in order to minimise the downtime before they are productive. Since new hiring is likely to be muted, well-being of employees and diversity in the workforce which received maximum attention during the pandemic would continue to receive the patronage of businesses. However, the purse being smaller, it would call for innovative approaches. Remote working is not likely to become the most preferred mode with most organisations unless under dire circumstances, as they have realised the limitations of creating the bond and connectedness amongst the employees and hence would not be encouraged. On the other hand, hybrid working is likely to be extended for some more time in order to optimise the costs and also to establish a pragmatic way forward. Skill development of existing employees would be supported as a necessary measure to cope with the changing environment and avoid or postpone new hires, thus saving costs. In the long run, this would also lead to higher retention of talent and stay competitive in the marketplace.
Thus HR managers would have to plan for cost-effective, personalised learning pathways curating career opportunities for their staff. They would have to move away from using the generalised content disseminated through the standard Learning Management Systems (LMS) and adopt one of the digital platforms that would help integrate the analytics of operations efficiency with the employee lifecycle milestones, keep track of aspirations of employees and match them with emerging roles. Performance management and key result areas would have to be reoriented towards customer centricity. Since part-time and gig workers are on the rise, contractor work management has to be integrated with core HR to support the activities related to work scheduling , payroll, and various on-boarding and information security.