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2021 Trends in Human Resources

December 8, 2020

This post is part of G2's 2021 digital trends series. Read more about G2’s perspective on digital transformation trends in an introduction from Michael Fauscette, G2's chief research officer and Tom Pringle, VP, market research, and additional coverage on trends identified by G2’s analysts.

Reimagining HR tech for a remote workforce

This year, we have all had to figure out new ways of taking care of people—our friends, our family members, our coworkers, ourselves. Employers must do this too, and for the HR professionals tasked with taking care of their company’s employees, that work will be as challenging as ever in the year ahead. 

What should managers do to keep their workers engaged when so many are now working remotely? How can workers stay productive when there are constant distractions at home and in the news? What tools are available to help companies build more inclusive and diverse workplaces?

The coronavirus pandemic has raised these questions for HR teams at companies around the world as they grapple with how to keep their employees productive and safe. Many organizations are turning to advances in HR software and technology to help them navigate these challenges.

Here are the HR tech trends to watch for in 2021.

Leaders will prioritize diversity and inclusion like never before

This summer’s nationwide protests that followed the killings of George Floyd and other Black Americans brought the issue of racial justice in America to the forefront, both in the public sphere and for private businesses. Major companies released supportive statements and published posts on social media, but now that the glare of the spotlight has faded, many companies will make significant investments in 2021 in solutions that aim to help them increase diversity and inclusion.

G2’s Diversity Recruiting software category, first launched in early 2019, saw a significant uptick in interest this year—traffic to the category page is up more than 300% in 2020 compared to the previous year. This category is designed for software products that help companies automate the process of building diverse talent pools and reduce or eliminate unconscious bias in the hiring process. 

While traffic to other G2 categories surged in March and April this year, the graph for Diversity Recruiting was relatively flat then; then it saw a big jump in June 2020, as protests and riots marked a reckoning that was underway, and interest has remained higher since then. 

traffic to G2's Diversity Recruiting software from October 2019 to October 2020

Many organizations have pledged to invest in solutions aimed at moving the needle on diversity and inclusion, and the need for greater focus in this area is clear. A multiyear survey by PricewaterhouseCoopers found that while 76% of organizations said investing in D&I programs is a value or priority, only 5% of organizations were succeeding in key dimensions of D&I programming, such as establishing affinity groups. 

Technology can only take you so far, and organizations must commit to shifts in their company culture in addition to spending money on consultants and software. Making the workplace an increasingly diverse and inclusive place will benefit existing employees, as well as attract top prospects looking to work for companies that demonstrate they value diversity.

Related: The Impact of AI on Diversity Recruiting

Tools for employee engagement become indispensable

A wide variety of technologies have made it possible for work to continue remotely. Meetings can be held over a video conferencing platform, collaboration can happen on digital documents, and watercooler chats can happen over messaging software

Keeping a clear picture of how engaged employees really are and what the organization can do to best support them is a greater challenge. It’s harder to read the room when everyone is in their own room, miles apart. Plus, we are all still adapting to how to work from home, how to function in the new normal. 

According to a recent survey from Gallup, levels of employee engagement fluctuated significantly in 2020. Gallup defines engaged employees as those who are “highly involved in, enthusiastic about and committed to their work and workplace.” 

graph showing employee engagements trends in the US

Source: Gallup

The percentage of engaged employees reached above pre-COVID-19 levels to 38% in early May 2020, according to Gallup, before falling to 31% following the killing of George Floyd later that month and the subsequent protests and unrest. Engagement reached another high in late June 2020 before settling back slightly above pre-COVID-19 rates of 35% to 36%, Gallup says. In addition to those workers classified as “engaged,” another 13% of workers are “actively disengaged” while the remaining 51% are “not engaged.” 

What can employers do? One place to start is to find out what is working or isn’t working about the current engagement efforts in the organization. Products with pulse survey functionality have seen significant investment in recent years, and companies are wise to continue asking their employees for feedback frequently.

However, their efforts must go beyond surveys. People crave recognition, a sense of belonging, and a chance to grow, and having channels for employees to offer recognition or shoutouts to their colleagues will continue to be important.

In addition to investing in their diversity and inclusion efforts, companies will also continue to emphasize learning initiatives to retain employees and keep their teams’ skills sharp. For companies that have trouble finding time for their employees to work on learning, microlearning platforms could be a good solution for delivering bite-sized learning modules.

These crucial steps for maintaining employee engagement take extra effort in the new remote work world, but they are worth it, and more companies will realize that in 2021.

Our analysts reveal what's big right now in their 2021 Digital Trends reports.     See our predictions here →

The issue of employee burnout will finally get some deserved attention

When the pandemic began, it was survival mode for most companies and for workers who were lucky enough to avoid losing their jobs—setting up remote meetings, changing processes, adapting recruiting efforts. Months into these changes, as the pandemic is far from over, that emphasis on surviving and getting by never really went away. Many workers are burned out, and for many businesses, addressing it is no longer optional.

Burnout has long been an issue that workers have grappled with, and it is a particularly urgent problem now. According to an August survey by FlexJobs and Mental Health America, 75% of workers said they had experienced burnout, and 40% said they have experienced it specifically during the coronavirus pandemic. There were a variety of reasons cited for burnout, but struggles with mental health are a big factor, with 42% of employed workers saying their stress levels are high or very high.

Work pressures are contributing to that stress, with 37% saying they are working longer hours during the pandemic and 76% reporting that workplace stress affects their mental health. 

graph showing levels of employee burnout before and during the pandemic

Source: FlexJobs 

Employers are starting to realize that the abrupt transition to a remote work environment may have been technologically feasible, but many companies haven’t grappled with the longer-term effects that many of their workers are feeling.

Some companies might turn to corporate wellness software, which offers resources for employees such as reading materials on physical, mental, or financial wellness, as well as engagement tools like surveys or gamified competitions. Since COVID-19 has put extra financial pressure on many families, many companies will investigate adding financial wellness platforms to their benefits offerings. These products help deliver financial education content, personalized coaching, and financial goal tracking to employees. 

Some of these products offer earned wage access, which enables employees to receive some of their wages between paychecks, which can help when times are especially tight. 

However, workers also reported lower-tech ways that companies can support workers’ wellbeing. Over half of workers in the FlexJobs and Mental Health America survey mentioned above, reported that having flexibility in their workday was key, followed by encouraging time off and offering mental health days.

If companies want to increase retention and help their workers be their most effective selves, they must double down on efforts to support the whole person. 

AI plays a role in remote recruiting

One major challenge that companies face is finding the right people for the right roles in their organization. In 2021, faced with recruiting remotely, even more companies will adopt recruiting tools that automate many aspects of the recruiting process, from initial sourcing of candidates through final interviews. 

Remote recruiting brings new challenges. While the initial stages of interviewing may be similar, it’s no longer possible for many companies to bring a candidate into a physical office for a second or third interview. 

Software makers are developing increasingly advanced tools that can help businesses overcome some of the challenges of remote recruiting and hiring. 

Video interviewing software had been on the rise even before the pandemic, but now it is all but essential for all companies in this new remote hiring era. These tools are growing more advanced, with some using AI to assess a candidate’s facial expressions and speech in a recorded video, although these AI-enhanced platforms have also faced criticism.

 

Another increasingly important component of a recruiter’s toolbox is recruiting automation software, which deploys artificial intelligence (AI) to rank candidates and source qualified talent for open positions. 

Since the Recruiting Automation software category launched on G2 in mid-2018, its product list has ballooned from about 30 products when the category first appeared to over 160 different products this year. 

virtual recruiting statistics

Source: LinkedIn 

There are signs that recruiters could use the assistance. A survey conducted in March and April 2020 by Entelo found that COVID-19 has impacted hiring at 71% of organizations surveyed. 

Interest in tools for remote recruiting has grown since the start of the COVID-19 pandemic. Traffic to G2’s Video Interviewing software category spiked in March 2020 as coronavirus lockdowns were taking effect, more than doubling compared to January 2020. Since then, its traffic has remained steadily above pre-pandemic levels. 

Recruiters who are now hiring a remote workforce will likely depend on these tools in an effort to get an edge on the competition.

The rise of HR chatbots (hasta la vista, 800 number helpline)

Chatbots have been used for everything from helping insomniacs to ordering pizza, and they are increasingly showing up in the HR department’s software stack. 

That trend should continue in 2021 as companies deploy chatbots to help with a variety of tasks, including recruiting, service requests, employee communication, and performance reviews. Powered by AI, chatbots can respond intelligently to a variety of situations that currently take up time that HR employees could spend on other things.

They have especially taken hold in recruiting, where they are deployed to interact with candidates and provide a more personalized experience for potential applicants. Chatbots can be deployed on job boards or career pages to engage candidates, and ask screening questions focused on the candidate’s skills or goals, thus saving recruiters time from doing phone screens with candidates who aren’t a good fit. 

The growth in the recruiting chatbot space was underscored when video interviewing platform HireVue paid an undisclosed amount to acquire AllyO, which makes an HR chatbot, in October 2020. AllyO had raised $45 million in Series B funding in 2019, which brought the company’s total funding to $64 million over three years. 

Chatbot developers are also aiming to replace the HR helpline with chatbots that can answer employees’ service-related questions such as how many vacation days they have left or when open enrollment starts. By handling these questions with a chatbot, HR staff have more time to work on other projects. Also, with chatbots, employees can get their questions answered 24/7.

Intelligent virtual assistants (IVAs) go a step further, using natural language processing and machine learning to understand a wider range of inputs than scripted chatbots. 

Using chatbots or IVAs for HR is not without risks. Companies must frequently test their chatbots for security vulnerabilities to stave off hackers, who have been known to create dummy chatbots that gain access to unsuspecting users’ personal information

Nevertheless, the future is bright in 2021 for AI helpers on the HR team.

Thanks for reading our look into the HR crystal ball in 2021—come back to G2’s Research Hub for even more in-depth analysis of these topics and other trends impacting the HR tech industry in the year ahead.

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