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Industry Insights | 10 minute read

What are the top talent acquisition trends that will dominate 2023? 

December 8, 2022

The way we work has changed considerably over the past few years and this has had a significant impact on talent acquisition. As we head into 2023, change will continue to be the predominant headline in the talent space.

However, it will likely be at a slower pace than what we’ve experienced over the last couple of years, and it won’t necessarily be such a distinct change. Instead, it will be a refinement on the new ways of working that have been introduced over the last few years.  

In this blog post, we’ve outlined some of the talent acquisition trends that will dominate 2023 (and beyond).

#1: “The Great Evaluation” is here. (Bet you haven’t heard that one yet.) 

Leadership teams are in evaluation mode. After such a frenetic couple of years with massive amounts of change, a period of evaluation is long overdue. And absolutely everything is being evaluated, including all that falls under talent acquisition and talent management. Everything from working practices and employee value proposition (EVP) to tech stacks and team structure.

This period of evaluation will continue well into the new year as companies look to set themselves up for success in what is shaping up to be yet another period of uncertainty. The cost-of-living crisis, record inflation, ongoing supply chain issues and critical skills shortages all show no sign of abating any time soon. Talent leaders should also be evaluating their processes, people and HR technology to optimize and generate efficiencies where possible. And the results can be used to advise the C-suite on next steps for talent acquisition and talent management.  

#2: Sharing is caring: Talent acquisition and talent management teams will strengthen alliances.  

Collaboration between talent acquisition teams and their talent management and HR counterparts will ramp up. The teams, which already work closely, will join forces even more to share and consolidate resources. This isn’t necessarily to reduce costs (although that will be a bonus); it’s more about ensuring the entire talent strategy is aligned with business need.

As these change, talent teams must be able to pivot to ensure they can access the skillsets the business needs to meet its goals. EVPs will also need to be assessed and updated. And the same goes for employment branding – the two go hand in hand and must align. Adaptive planning and forecasting will also play a more prominent role, with all talent functions working collectively on both immediate and future talent needs.  

#3: Hybrid working will become mainstay, despite many employers ordering employees back to the office. 

Hybrid working has become the norm and it’s here to stay (unless you work at Twitter, that is!). Jokes aside, hybrid working allows companies to get the best of both worlds as it balances organizational success with the interests of employees. In 2023, organizations will optimize their hybrid working programs to find a solution that works for all. That may mean some will make working from the office mandatory on certain days of the week, while other employers may want a more laid-back approach and will leave it to employees to decide how many days they work from the office.

Some companies that ordered employees back to the office full-time in 2022 may rethink their decisions and opt for a hybrid approach instead. With a tight talent market, companies that don’t have a hybrid working program risk losing out on top talent. It’s a key driver for people seeking new roles – 63% of jobseekers say a top factor in their decision to accept a job offer is whether the job is remote, hybrid, or in-person, according to the iCIMS Workforce Report 2023 – and demand is unlikely to dissipate.   

#4: Employees will move jobs (not employers) à la internal mobility programs. 

Internal mobility has always been important, but it has grown in prominence the past couple years and this upward trend will continue. Internal mobility programs allow companies to move talent around the business to where they are needed most. Internal mobility also boosts employee retention – several studies have shown employees who make internal career moves are more likely to stay at a company longer than those who stayed in the same role. It increases loyalty through and through.

Moving forward, talent leaders must prioritize workforce planning as this will give them the data they need to make accurate skills forecasts. This information then needs to be relayed to the learning and development team so they can create suitable training materials to upskill those who need it, while talent management teams will be able to identify employees who seek out development in their careers. As we’re heading into another year of uncertainty, internal mobility can help fill open roles at a minimal cost. Now's the time to upskill your workforce and optimize your talent acquisition function. Workforce reductions and hiring freezes really should be the last resort because of how detrimental the consequences can be. 

 

Read more: Why a long-term approach to talent acquisition is critical 

#5: People analytics will help to solve even more business problems. 

People analytics (or workforce analytics or HR analytics) will become a priority for many organizations in 2023. It sounds obvious, but there's a lot more to people analytics than people management. The data derived from people analytics can help improve a company’s effectiveness and ultimately, the bottom line. We've long known that it can improve recruiting efficiency, but it can also halve attrition rates, research from McKinsey revealed.

As we head into what looks to be another unpredictable year, organizations will increasingly turn to people analytics to help solve some of the talent challenges they’re experiencing – from skills shortages and employee attrition to diversity, equity, inclusion and belonging. People analytics teams can collate data from every stage of the candidate journey (from attraction to retention), and we expect demand to soar next year as organizations adapt to the rapidly changing labor market.  

 

If you’re struggling to get budget sign-off for people analytics, check out this blog post: 7 tips for securing budget approval for people analytics

#6: Demand for contingent workers will increase (again). 

Contingent workers represented almost 22% of all workers in the US in 2021, research from SIA revealed, and we expect this figure to rise further in 2023 as companies look to counteract chronic skill shortages and an uncertain global economy. Contractors and temporary employees have and will become an extension of the workforce for a lot of organizations, especially those in industries suffering historic skills shortages, such as healthcare, financial services, and energy and utilities.

Contractors can help organizations scale at speed, while providing the skills for expansions and/or new product launches. Hiring someone who is only going to stay for a year or two shouldn’t be viewed negatively. Contingent talent typically brings unique skills into a business, along with new perspectives. (So, what's not to like?) Organizations that are planning to expand their contingent worker program should treat this segment of talent in the same way as their permanent counterparts.

Make sure your employee value proposition caters to this segment of worker. Don’t be afraid to provide learning and development opportunities to your contingent workers either. A holistic approach to your entire workforce, permanent and temporary, is imperative to drive strategic business decisions.  

#7: More companies will partner with RPO providers. 

Recruitment process outsourcing (RPO), like most things, has evolved. It stopped being a transactional solution a long time ago. RPO partners have become an extension of their client organizations thanks to the value they bring to the talent function holistically (and many provide total talent solutions too). The strategic workforce insights RPOs provide helps to ensure businesses have access to the skills they need to meet their business goals both in the short- and long-term. The ability to scale up or down has fast become another key advantage of an RPO partnership.

Modern business cycles have become a lot shorter. Recessions used to last for years but now it's months and this can make talent acquisition challenging for organizations that don’t take a long-term approach to talent acquisition. Leadership teams have enough on their plates in the coming year, so we expect the number of RPO partnerships to grow. Especially when you consider 88% of companies with an RPO partnership said it gives them more time to focus on other business-critical priorities, according to a report from Lighthouse Research and Advisory. 

As another new year beckons, finalizing your talent acquisition strategy has never been more important. Understanding these talent trends will help you decide what you need to prioritize to give your organization a competitive advantage in what is going to be quite the year.  

From budget to strategy: The complete 2023 zip file for talent acquisition leaders
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About Carmen Scanlon

As Vice President of Client Solutions, Carmen Scanlon is responsible for consulting with organizations as partnership is being considered to support and optimize their talent strategy. With an extensive background in HR solutions, she combines her experience supporting clients with outsourced HR services and HR technology to deliver a unique perspective when building agile and customized talent solutions for WilsonHCG clients. Top 5 CliftonStrengths: Restorative | Belief | Focus | Futuristic | Relator

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