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People Analytics Trends: 2023 Priorities for People Analytics

There is a vibe-shift going on with people analytics at the moment. If you look back at previous years’ prognostications, you could likely copy and paste what was written in 2018 to the upcoming year, with peripheral changes around the edges.

Not anymore, it seems.

2023 is likely to be a much different year for people analytics, and those who either can’t, or won’t, acknowledge it are likely to be left behind.

To get a good view of what’s to come, we asked people analytics practitioners from a variety of industries to help predict key trends that will emerge — or continue to shape — the field of people analytics. Read on for their take.

Why the big shift in people analytics?

People analytics emerged in prominence as a discipline between 2010 and 2020.

That ten year period is distinguished by one superordinate trend: almost all key economic indicators were trending in the right direction – typically “up and to the right”.

People analytics was the beneficiary of the positive economic trends of this time period.

Growth in people analytics teams? Check.

Growth in salaries? Check.

Growth in technology, budgets, and resources? Check.

This trend was only accelerated during pandemic times because data on workforces became center-stage, as organizations ran a societal-wide experiment with remote work that they didn’t sign up for.

The cost to borrow money was near zero; therefore unprecedented capital injections were made into the economy to make sure the pandemic didn’t become cataclysmic. Those investments also allowed the people analytics “gravy-train” to continue.

However, those times are coming to a close… Economic conditions – inflation, layoffs, unemployment, etc – will set the tone for 2023 plans in people analytics.

So, how does people analytics work when the economic indicators aren’t “up and to the right”?

It looks like a function not made of opulence, but made of necessity.

People analytics in 2023

People analytics in 2023 – barring some major positive economic shifts – has the following trends on the horizon:

Understanding productivity

“I think a big trend is going to be understanding productivity – how to measure it and how to act on it in a way that isn’t super ‘big brother’ ish. I know it’s a big topic of discussion for us in a predominantly remote culture. Another one is.. of course…attrition! Predicting it, specifically.” — Hannah Markell-Goldstein, Research & Insights Lead – People Analytics at Dropbox

Automating people analytics tasks

“A few years ago, I had to learn multiple programming languages and skills just to do ubiquitous tasks like combining two datasets in a warehouse. Now, there are one-click ways to pull from greenhouse or Orgnostic and its peers who let you build in a familiar UI. The needs for overly technical knowledge will shift and the equity of access to HR needs (“I need a database with my HRIS and ATS data combined”) will enhance the work folks can do” — Max Brawer, Director of People Analytics & Tech & Ops at Level

Flexbile-first – to be or not to be

“One of the areas organizations will be focusing on when looking at different types of work engagements (in-person, remote, hybrid), will be to first determine if an organization is flexible-first, meaning whether there is a buy-in to support the choices and options in the first place, or will the type of work be mandated, and how this affects the employee experience and organizational outcomes” — Rekha Gurnani, Head of Global Compensation & People Analytics at Box

Best HR tech emerges

“In a recession, we will see a significant shift in HR Tech. HR Tech that adds value will survive. HR Tech that does not add value will disappear. When companies are focused on weathering the storm, the last thing they want is to buy tech that is nice to have. Similarly, investors are more conservative in allocating their funds to new companies. By the end of 2023, we will see some of the best and most useful HR Tech.” — Konstantin Tskhay, VP of Organizational Effectiveness at Top Hat

Psychological recession and employee wellbeing

“I think that we will be dealing with the concept of psychological recession, which you can think about in terms of an emotional state induced by stress caused by what’s going on in the world such as the pandemic, economic state worries, among other things. The term “psychological recession” was first brought about during the last recession of 2008 and we can notice a lot of the same anxieties in parallel with what is happening now. This brings us to engagement concerns that can stem from this and the next step would be deep diving into engagement, mental health, and the overall wellbeing of employees to determine the impact and any subsequent interventions.” — Maria Ustavalkova, Sr. People Analytics Business Partner at Motive

To higher engagement through in-person team trust-building

“In 2023, I predict we will start to see mandatory quarterly offsites institutionalized across all remote-first and remote-flexible companies. This will be the result of companies with remote workers realizing the importance of scheduled in-person time for vital team trust-building and bonding. Because of this dyanmic, companies will be replacing dollars spent on office space rent with dollars spent on plane tickets and events. Even local workers who usually don’t travel for work will be racking up their rewards points to meet with their remote co-workers. Companies who adopt this strategy will reap the benefits of higher employee engagement and lower attrition rates.” — Patty Smith, People Analytics Manager at Cruise

Tracking career pathing

“I think that big trends in people analytics next year will be tracking career pathing, progression, and internal movement.” — Kaylin Bailey, Talent Analyst, URBN

Predicting mental health challenges

“We’re completing one year after the critical time of pandemic. The boundaries between work and home aren’t so easy to define. A big trend (and challenge) for 2023 will be: how can companies predict and anticipate mental health problems? Thinking about a prevention view, how we can keep mental health in good levels and how can we check if our managers are really worried about that?And also, how can we use People Analytics to prevent, predict and or anticipate burnout? I think these two challenges are happening right now, but they will be a trend for 2023, about the active role of HR and managers addressing this problem.” — Albert Liu, HR Business Partner

Building a financial case for non-core HR

“One of the trends that will likely be big in 2023 is the financial justification of “non-core” business support services in technology companies, assuming HR core is talent acquisition and talent management, and non-core is Employee Resource Groups and DEI initiatives.” — Aaron Hardisty, Systems Engineer

Diversity efforts become even more data-driven

“A big trend will be making data-driven decisions in terms of hiring, turnover, and DEI. Have an overview of the diversity of existing and new employees, those leaving, and their reasons for leaving.” — Oluwatosin Zubair, Team Lead Customer Operations at MTN Nigeria

Our take on people analytics in 2023

Justifying existence of people analytics teams

Is your people analytics team a luxury or essential? If all your team is doing is manually managing data and reporting, it will likely be automated. Conversely, if your team is only working on years-long research “passion projects”, your work will also be disrupted. You need ways of proving your value…today. Your team must show a direct linkage to business strategy execution, and how it is contributing to the success of the business. Is what HR is doing working/paying for itself? Profit center > cost center.

Deployed analytics and the buy vs build dilemma

Why have a human do something manually a technology could do cheaper and more effectively? People analytics technology in the past was slow and cumbersome, but with the investment in HR technology since the pandemic, HR tech has improved dramatically. Patrick Coolin’s article on “Crossing the 2nd Wall of HR” discusses moving past “advanced analytics” and to “deployed analytics”. 2023 is the year of deployed analytics, but with resource constraints most organizations will need to “buy” rather than “build” that capability.

Scenario/workforce planning for cost modelling

There is workforce planning in times of growth, and workforce planning in times of change/shrinkage… Leaders need a better understanding of their revenue per employee, the efficiency of human capital, and cost of labor throughout the business. They need to understand who their critical talent is, and if they are being retained. You can help.

Business acumen

Does your people analytics team know how your business makes money? Could they explain it to the CEO in a way that they wouldn’t be embarrassed? Most people analytics team don’t have sufficient business acumen. Don’t be embarrassed, it’s common. 2023 is the year to change that. In an upcoming People Analytics World podcast, Cole Napper and Tracey Smith discuss effective ways for improving business acumen of people analytics teams.

Engagement/culture’s contribution to productivity

Does the expression “doing more with less” ring a bell? This will likely be the mantra of leaders in 2023. In this environment, listening to employees will be as important as ever to make efforts to improve culture, engagement, and productivity. Organizations who get this right will outcompete those who don’t.

Wild card:

OpenAI open-sourced its ChatGPT bot this week. ChatGPT’s answers about everything, including this article with Richard Rosenow about people analytics, are incredible. This may be the most disruptive technology released in a generation or more. We may be on the AI arms-race exponential, runaway intelligence trajectory that silicon valley luminaries have predicted.

This piece has been co-written with members of the People Analytics Lounge, online community of People Analytics and HR leaders, professionals, practitioners, and enthusiasts. We would like to thank everyone who took part in forecasting the trends for the year to come!

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Editor’s note: The responses have been lightly edited for clarity and brevity.