HR Update

 Shirley Hall and Aida Geragusian from Eversheds provide a summary of the Eversheds/Winmark HR 2020 report which predicts the trends that HR departments are likely to face in the coming years.

 
Following years of economic crisis and recession, the focus of many organisations, including the NHS, has been survival and austerity. Now that signs of improvement in the economy are beginning to show, there is an opportunity for organisations to take stock of the challenges which lie ahead and begin to plan.
 
The Eversheds/Winmark HR 2020 report predicts the forthcoming trends which the HR function within these organisations will face over the coming years following a survey of HR directors and non-executive directors of a range of organisations. As the remit of HR professionals seems to be ever expanding, the report helpfully maps the challenges to allow HR to consider how it may bridge the gap between day-to-day HR functions and Board level HR strategies.
 
Productivity
 
Lagging productivity is a particular concern to organisations across the public and private sector. The estimated productivity in the UK is 20% less than the G7 average.
 
Within the NHS, maintaining productivity is key to delivering excellent patient care. The main drivers of productivity, such as a motivated workforce, have recently come under widespread scrutiny following the growing discontent amongst junior doctors. Productivity (and how to maintain this) will therefore continue to feature highly on the agenda of both NHS and private health provider HR functions.
 
 
War for talent
 
A report released by the UK Commission for Employment and Skills (UKCES) in 2014 suggested that 2 million additional jobs are to be created for managerial and professional occupations between 2012 and 2022. UKCES has also claimed that there will be a larger polarisation between high skilled and low skilled jobs in coming years, with individuals finding it difficult to progress to higher level jobs.
 
It is crucial that whilst recruiting highly talented workers, pathways are left open for lower skilled workers to progress. Indeed the NHS is already tackling this issue through workplace development opportunities.
 
Recruiting and retaining highly skilled medical professionals has long since been a challenge for the health sector, often having to rely on recruitment outside the UK to fill specialist health roles. This shortage is likely to continue as immigration controls are tightened. The NHS, more than other organisations, will be fighting hard in the war for talent over the coming years. 
 
 
Tapping into diversity
 
To win the war for talent, organisations will need to tap into all available talent pools. McKinsey’s 2015 Diversity Matters report states that gender-diverse companies are 15% more likely to perform above the national industry median and for ethnically diverse companies, this rises to 35%.
 
Apprenticeships are frequently mentioned as an avenue for talented people and with the introduction of the apprenticeship levy in April 2017 (aiming to create 3 million apprenticeship roles by 2020), organisations are more likely to be encouraged to develop their own in-house talent pool.
 
By diversifying recruitment methods to reach a wider spread of talent, the health sector will attract the best and the bright to boost lagging productivity and encourage employees to stay. 
 
Technology and innovation
 
Technological innovation is high on the agenda of many HR directors, in particular the use of mobile technology, online applications and automation. Within the health sector, technological advances on the ground mean better and more innovative patient care.
 
To ensure the best use of new technologies, careful planning and foresight is required to avoid the risk of a rift (much like the polarisation between low and high skilled workers) between work which can be automated and work which requires human involvement. This is of particular concern in the health sector, where patient care will demand continued one-to-one interaction but the pressure to keep up with advancing medical technologies will remain. Ensuring that health sector staff are sufficiently trained to operate the new technology will undoubtedly fall to HR.
 
Changes to retirement agenda
 
Due to developments such as auto-enrolment, the Department for Work and Pensions estimates that annual savings into workplace pensions will increase by between £14 and £16 billion by 2019-2020. The Government is also reforming the state pension with the introduction of the single tier state pension in April 2016. State pensions age will also be increased in line with life expectancy, meaning employees are expected to remain in the workforce for longer.
 
Many organisations are already taking measures to address the issues which an ageing workforce may present. For example, the NHS has a Working Longer Group, and well established flexible retirement practices, giving it a head start at tackling this challenge which is likely to grow over the coming years.
 
It will be interesting to observe whether the main challenges highlighted in the Eversheds/Winmark HR 2020 report will feature on HR professionals’ agendas in the coming years in the way the report predicts. Even more interesting will be to review if, in 2020, the HR function has succeeded in evolving from a peripheral support function to being a key strategic player in the organisation.
 
If you would like to receive a copy of the Eversheds/Winmark HR2020 report, please contact either Shirley Hall at shirleyhall@eversheds.com or Aida Geragusian at aidageragusian@eversheds.com.
 
 
Shirley Hall
Partner, Eversheds LLP
 
Aida Geragusian
Associate, Eversheds LLP