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Key Workplace Trends & Impact to Human Resources


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Title: Key Workplace Trends & Impact to Human Resources

Key Workplace Trends Impact to Human Resources
  • March 18, 2008

  • From McKinsey Quarterly, online journal January
    2006, Ten Trends to Watch Davis and Elizabeth
  • From SHRM Workplace Forecast, 2006-2007 SHRM
    Special Expertise Panels 2007 Trends Update,
  • Business Week Survey to 2,000 managers, published
    August 20, 2007
  • Are They Ready to Work? Employers Perspectives
    on Basic Knowledge and Applied Skills of New
    Entrants to 21st Century US Workforce, key
    findings of survey to 400 employers by Conference
    Board, Corporate Voices for Working Families,
    Partnership for 21st Century Skills, and Society
    for Human Resources Management, October 2006.

McKinsey Quarterly 10 Trends to Watch -
  • Centers of economic activity will shift globally
    and regionally
  • Currently Asia (minus Japan) accounts for 13
    world GDP and Western Europe has 30. Within 20
    years Asia will catch up.
  • Public sector costs will balloon, requires
    increase in productivity
  • Aging population causes huge outlay for pension
    health care.
  • Not just developed economies but countries with
    emerging markets demanding more retirement
    health care security.

Macroeconomic trends
  • Consumer spending changes worldwide
  • Billion new consumers worldwide in next decade
    with increase in discretionary spending 4
    trillion to 9 trillion plus.
  • Hispanic population in 2015 spend equivalent of
    60 of all Chinese consumers.
  • Technology will give all consumers info and
    access to products.

Ten Trends to WatchSocietal and Environmental
  • Technological connectivity transforms way people
  • 12 newlyweds last year met online, 2 billion use
    cell phones, billion Google searches a day (more
    than half not in English), 9 trillion emails a
  • Integration of global labor market
  • 33 million college educated in developing
  • Companies shifting jobs where the talent is and
    not just low paying jobs.

Societal and Environmental Trends
  • Behavior of big business coming under
    increasingly sharp scrutiny.
  • Current US ideology not understood or accepted
    around globe intellectual property rights, free
    trade, shareholder value.
  • Regulatory backlashes

Societal and Environmental Trends
  • Demand for natural resources and strain on
  • Oil demand to grow by 50 in 20 years. Supply
    can not keep up with demand. Similar demands on
    copper, steel, aluminum.
  • Water shortage

Ten Trends to Watch Business and Industry
  • New global industry structures
  • Nontraditional business models flourishing
  • Management not an art but a science
  • Technology and highly sophisticated software
    running companies.
  • Most CEOs are boomers impending leadership
    crisis is coming. As many as 50 senior managers
    leaving in next 5 years.

Business and Industry Trends
  • Access to information changing economics of
  • Google and other online tools allow instantaneous
  • Open source knowledge, new models of production,
    distribution and ownership.
  • World-wide patent applications rose 20 annually
    in last 10 years.

SHRM Workplace Forecast 2006Top Three Themes
  • Rise in healthcare costs
  • Implications of increased global competition
  • Demographic changes, aging of workforce,
    impending mass retirement of baby boomers at
    about same time

Demographic Outlook
  • In 2003, Hispanics became the largest minority
    group in US
  • Most population increase seen in ethnic and
    racial minorities - births and immigrants
  • Singles outnumber married couples with children
  • Later age for child bearing

Racial and Ethnic Composition of the Population
Demographic Impact
  • Aging population
  • Sandwich generation caring for children and
  • Fewer workers to support Medicare Social
  • Diversity of workers impacts workforce policies
  • Flextime, telecommuting sabbaticals
  • Training line managers to respond to differences
    - cultural, languages, generational, technology
  • Bringing retirees back into workforce

Economic Outlook
  • Rise in healthcare costs is most important
    economic trend
  • Rise in costs of retiree health benefits
    governmental programs
  • Labor shortage projected in 2012 will have 21
    million jobs and only 17 million new entrants
    into workplace
  • Cost of security war on terrorism causes
    continued economic uncertainty

Social Outlook
  • Changing definition of family
  • 24/7 workplace
  • Broadening diversity religious, ethnic and
  • Poor educational performance US students
  • Women attaining higher rates of education and
    professional degrees versus men
  • Global health issues HIV, SARS bird flu, plus
    US has highest obesity rate

Percent Households by Type
Source U.S. Census Bureau, Current Population
Survey, March 2002 Supplement
Science Technology Outlook
  • Technology increases communications with
    employees and potential for monitoring employees
  • Increased theft of intellectual property and
    identity theft
  • Skills quickly become outdated and gap in skills
    learning rich vs. poor and young vs. old
  • E-learning any time any place
  • Wearable computer devices

Political Outlook
  • Focus on Global and domestic security driving
    political agenda
  • Health care privacy and portability legislation
  • Increased political partisanship and state
    reactions related to the political party in power
  • Increasing grassroots pressures on labor
  • Political impact of federal deficit and cost of
    war in Iraq
  • Weakening of Affirmative Action - policies tested
    in courts

International Outlook
  • Exporting of US manufacturing other white
    collar jobs
  • Ethnic strife causing segregation of cultures and
    increased anti-Americanism
  • English spoken by ¼ of worlds population
  • Spanish is second language of US
  • Development of global labor standards

Employment Outlook
  • Rising health care costs, continued double digit
    increase per annum over next 5 years
  • Employee demand for flexible work schedules
  • Growth in women and minority owned business
  • Benefits compensation structured for diverse
    population and varied needs
  • Increase in hiring college grads and highly
    skilled workers

US Census Bureau, 2004 Supplement
  • Average all states educational background
  • 25.5 have some college
  • 18.1 have bachelors degree
  • 9.6 have advanced degree
  • State of Tennessee educational background
  • 23.0 have some college
  • 17 have bachelors degree
  • 7.3 have advanced degree

Measuring Up 2006 Report Card on Higher
Education by National Center Public Policy and
Higher Education
  • In Tennessee 33 aged 18-24 were enrolled in
    college in 2006
  • Compared to top ranking states at 41
  • Ranking TN below Korea, Greece, Finland, Belgium,
    Ireland, Poland, Australia, France, Hungary,
    Spain and New Zealand
  • 2006 Tennessee Report Card
  • Preparation C- (up)
  • Participation C- (up)
  • Affordability F (neutral)
  • Completion B (up)
  • Benefits C (up)

The Value of a College Degree?US Census Bureau,
2004 Supplement
  • Average all States avg. personal income
  • 25,053 with high school diploma
  • 48,417 with college degree
  • 70,851 with advanced degree
  • State of Tennessee - avg. personal income
  • 21,815 with high school diploma
  • 43,644 with college degree
  • 67,986 with advanced degree
  • For 2008, adjusted for annual 4 increase
    51,056 with college degree

Change in Number of Jobs by Education Source
Projected 2000-2010
Source Bureau of Labor Statistics
2007 SHRM Workplace Update
  • SHRM expertise panels look at 13 areas for key
    trends and changes from previous year
  • Looks at trends in following areas
  • Corporate Social Responsibility
  • Employee Health, Safety and Security
  • Employee Relations
  • Ethics
  • Global
  • HR Consulting/Outsourcing

2007 SHRM Workplace Updates
  • Labor Relations
  • Human Capital Measurement/HR Metrics
  • Organizational Development
  • Staffing Management
  • Total Rewards/Compensation and Benefits
  • Technology and HR Management
  • Workplace Diversity

Corporate Social Responsibility
  • Businesses recognize necessity for corporate
    social responsibility as part of required
  • Increase in transparency in operations
  • Awareness of gaps between haves and have nots
  • Business impact of Generation Y priorities

Employee Health, Safety and Security
  • Influence of health insurance costs and new
    programs smokers penalties, health risk
    assessments and wellness programs, particularly
    for diabetes and obesity
  • Concerns for health information protection and
    risks of identity theft
  • Ongoing concerns for communicable diseases and
    possible pandemic situations
  • More background and drug tests

Employee Relations
  • Retention of talent is strategic objective
    specific skill sets in short supply
  • Multi-generational employees see increased
    employee relations issues
  • Change in communications (social networks, blogs,
    etc.) and the new etiquette and ethics required
    for the workplace
  • Islamophobia

  • How to manage global talent and have the right
    talent, particularly in fast growing countries
    (India, China)
  • Immigration reform and employee shortages
    (construction engineering)
  • Balancing business needs with US centric versus
    global centric views
  • Multiculturalism

HR Consulting/Outsourcing
  • Changing role of HR due to outsourcing,
    consulting and global needs.
  • Small organizations are outsourcing all of HR to
    Professional Employer Organizations
  • Greater use of metrics to justify HR costs
  • Specialized niche HR consultants

Labor Relations
  • Union consolidation and attempt to organize more
    members in non-traditional areas
  • Impact of the cost of health care benefits to
    labor relations
  • Impact of immigration policy on union organizing

Human Capital Measurement / HR Metrics
  • Increasing demand to use human capital measures
    and HR metrics leading to standard sets of
  • Measures that are culturally sensitive and
    understanding of the various differences in
    acceptable practices
  • Increased use of technology for measurements

Organizational Development
  • Increase awareness of OD and impact on business
  • Supporting targeted groups (generational,
    cultural) with specialized development
  • Organizational performance tied to talent
    management ID, develop and retain those with
    critical KSA
  • More entry level workers lacking workplace
    etiquette, emotional intelligence, interpersonal

Staffing Management
  • Looming skills and talent shortage
  • Shifting demographics and use of global talent
  • Increasing use of technology in recruiting
  • Increasing use of assessments for pre-employment
  • Continued use of metrics but increase in
    alignment with business goals

Total Rewards / Compensation and Benefits
  • Proper oversight and compliance to regulations
    and increased transparency for executive
  • Impact of aging workforce on total compensation
  • Risk and cost shifting increase both government
    to business and employer to employee
  • Total rewards increasingly using career
    development and work/life balance issues, and
    importance of effective communications of all
    total rewards
  • Performance management and alignment with total
    rewards and business strategy

Technology and HR Management
  • Online social networking
  • Growth of ASPs and outsourcing technology
  • Real-time web applications ex. Remote
    interviewing, pulse surveys
  • Need for closer working relationships between IT
    and HR for HR technology
  • Legal issues for use of HR technology, ex.
    privacy issues and data storage

Diversity Management
  • Linking diversity to overall business strategy to
    ensure commitment
  • Demographic shifts in workplace and impact to
    recruitment and retention efforts of HR
  • Immigration and multi-cultural issues
  • Aging workforce and multiple generations working
  • Those with disabilities
  • Need to address varying religious and spiritual
    needs of diverse workforce

Are They Really Ready to Work?Study by SHRM,
Conference Board, Partnership 21st Century, Corp.
Voices Working Families
  • 63 predict a foreign language is important
    basic skill
  • Critical thinking 77.8 and creativity/innovation
    73.6 are top two responses for increasing in
  • Top three applied skills important to the
    workplace are professionalism, teamwork and oral
  • Employers list top deficiencies for college grads
    written communications, leadership ability and

Actions HR Professionals are Taking in Response
to Trends
  • Training managers to respond to generational
  • Changes in health care policies and plans in
    response to demographic changes
  • Changes in policies as response to federal and
    state regulations
  • Strategic HR planning and succession planning
    related to recruiting and retaining diverse
  • Increasing use of technology to perform
    transactional HR functions, and use of technology
    for more employee self service applications

Actions HR Professionals are Taking in Response
to Trends
  • Increasing HRs role in corporate ethics and
    crisis management
  • Increasing investment in training for employees
    and HR staff
  • Building human capitol factors/metrics into key
    business transactions planning to increase
    productivity to offset higher cost of business
  • More policies for work/life balance
  • Increase in policies for safety and security