PDF 2024 Global Talent Trends Report en

Workforce 2.
0
Unlocking human potential in
a machine-augmented world
Global
Talent
Trends
2024
Introduction Drive human-centric Anchor to Boost the corporate Cultivate a Conclusion Survey demographics
productivity trust and equity immune system digital-first culture
Introduction
The world of work is in full metamorphosis, There is no escaping the need for new ways of working Figure 1. Geopolitical and socioeconomic forces impacting three-year plans
forever changed by the seismic shifts of and new ways to value workers. The societal dynamics
C-suite question: Which of the following are influencing your 3-year plans? (Select up to five)
the past few years and accelerated by the emanating from the last few years (including louder
imminent human-machine teaming revolution. calls for fair pay, better working conditions, and less Up from 31%
environmental impact) are aggressively reshaping the Inflation, currency, and capital concerns 52%
Just as organizations were settling into a new (5th) in 2022
normal — with a focus on hybrid working, work contract. Leading companies are rethinking their Digital acceleration including AI 46%
comprehensive health and well-being, People practices, and leveraging greater talent science
to ensure a more sustainable, equitable and intuitive Rise of alternative, flexible, or distributive work models 42%
digitalization, and upskilling — Generative
work experience. Up from 27%
AI (Gen AI) burst onto the scene. Changing Shifting economic interests 37%
(9th) in 2022
not only how people work but the work The urgency is coming from all stakeholders. Two in five Extreme weather or natural disasters accelerated by climate change 35%
experience itself, Gen AI has been met with workers believe that the world of work is fundamentally
equal measures of unease and excitement. broken and one in four wish they didn’t have to work at New business entrants and digital-first disruptors 32%
Will it produce a real productivity lift? Can all. People crave the peace of mind that comes with job Cyber risk was
Cyber risk 29%
the increased risk exposure be effectively security and financial well-being — staples that become #1 in 2022
managed, and is it worth it? What will be increasingly important during times of upheaval. Stakeholder capitalism 25%
the permanent impact on the competitive Executives are also seeking solid ground, focused
Business interruption related to health crisis 23%
landscape? These are the conversations on keeping their business running by addressing
dominating boardrooms and team chats, inflation, digital acceleration, and alternative work models Role of organizations in driving social impact/equity 20%
with one universal truth emerging: Unlocking (see Figure 1). Climate concerns are hitting closer to
Health and wealth protection gap 19%
the potential of this new world of work home as more frequent extreme weather events impact
means keeping people at the heart of the business continuity. Cyber risk has been bumped from Supply chain interruptions/challenges 18%
transformation agenda. its top spot in 2022, and significantly fewer executives
Political unrest / war 16%
are accounting for an overall heightened risk environment
in their plans. HR remains anxious about rising labor Rising healthcare costs 12%
Thank you to the 12,200+ C-suite executives, costs, managing a remote workforce, and skills shortages. Down from 28%
Overall heightened risk environment 10%
HR leaders, employees, and investors who And 89% of asset managers see an engaged workforce (8th) in 2022
participated in this year’s study. as a key driver of company value. Net zero and environmental goals 8%
Mercer Global Talent Trends 2024 2

The C-suite is bracing for risk Figure 2: HR priorities for the 2024 People agenda
The turbulent business environment shows no signs Color key = Initiatives that executives believe will deliver the most business growth = Initiatives that executives believe will deliver the least business growth
of easing up. Protracted conflicts, skittish financial
On the
markets, and high operational costs continue to haunt 1. Enhancing the EX/EVP to attract and retain top talent 11. Improving sustainability/ESG accountability, metrics, reporting
agenda
the business community. Add in a raft of elections in
2. Investing more in benefits to improve physical/mental health for 50% of 12. Combating increased health and benefit costs
key geographies in 2024, and it’s no wonder near-term
HR leaders
risks dominate the C-suite agenda. This focus on the 3. Improving workforce planning to better inform buy/build/borrow strategies 13. Rolling out new HR tech / optimizing existing platforms
globally
present is concerning given executives’ long-term
4. Improving our HR/People analytics capabilities 14. Delivering on DEI goals
pessimism: Nearly two-thirds predict a “stormy” or
“turbulent” outlook over the next 10 years, according 5. Redesigning work to incorporate AI and automation 15. Redesigning our work operating model for increased agility
to the 2024 Global Risks Report.1
6. Enhancing/modernizing rewards practices 16. Optimizing the HR service delivery model
Weathering the storm requires risk management and
7. Investing more in benefits related to retirement savings and financial well-being 17. Putting sustainability/ESG at the heart of our business agenda
people management strategies that drive long-term
sustainability. As organizations brace for uncertainty, 8. Designing talent processes around skills 18. Delivering on WEF Good Work standards
executives’ top strategies for an economic downturn are On the
9. Improving people managers’ capabilities 19. Cultivating a digital-first culture agenda for
telling: They will double down on AI investment (43%),
reskilling (40%), and digital transformation (39%). Only 10. Investing in talent assessment and employee skills development 20. Restructuring, downsizing, and/or significant M&A activity only 15% of
one in five said they would reduce their workforce (down HR leaders
from one in four in 2022). This signals a positive trend
toward breaking the exhausting cycle of “churn and Lack of consensus among stakeholders
burn” and reflects HR’s focus on building from within this
year. Nearly two-thirds (63%) of executives believe jobs, Most HR leaders have plans to enhance the employee goals, yet executives see these areas as top drivers decisions, and 55% cite social sustainability (a focus
not people, should be made redundant. Yet with less than value proposition and experience this year to better of business growth this year. Seventy percent of asset on equity, social inclusion, and societal impact) as a
one-third very confident they can make human-machine attract and retain top talent (see Figure 2). Fewer are managers say that a company’s people sustainability secondary driver (ahead of environmental sustainability
teaming a success, navigating the future of work will prioritizing sustainability accountability, “Good Work” (including turnover, employer brand and talent and governance) — recognition that People risks
require attention to persistent people issues. standards,2 and diversity, equity, and inclusion (DEI) pipeline strength) is critical to informing investment are business risks.

Making work “work”: and putting the onus on managers to ensure that Organizations are being tested it’s changing the game. Over half of executives (54%)
their people leave work feeling good about their day believe that their businesses will not survive beyond 2030
What helps employees thrive in new ways
and energized for tomorrow. What drives a sense of without embracing AI at scale. To capitalize on the most
Despite some softening of the labor market, thriving varies, but a regression analysis shows that This year, solving for business agility and people significant technological breakthrough of our time,
organizations still struggle with their talent 42% of this variance can be accounted for across five sustainability is critical.3 HR professionals in organizations need to ensure that their business and
pipeline — elevating the importance of retention dimensions (see Figure 3). high-growth companies (self-reported 10% revenue people plans are amplifying human progress.
growth or greater in 2023) are more likely to describe
Organizations that are outpacing competitors are
their company as agile (54%) and focused on the long
Figure 3: What really makes a difference to employees term (49%) than those in low-growth companies (less
striding ahead on four priorities. They recognize that
human-centric productivity requires attention to how
than 3% growth). Fewer than half of executives (46%)
work is evolving and the skills and motivations of
Financial stability Sense of purpose are confident their organization can meet customer
those doing the work. They appreciate that trust is the
• “My company helps me afford • “I believe my work contributes to demand with its current talent model, and only 27%
true dialogue of work, fortified through transparency
medical care.” a worthwhile mission.” strongly agree that their workforce models are agile
and equitable work practices. As risks become more
enough to pivot talent from one area to another.
• “My company helps me prepare connected and less predictable, they understand that a
for retirement.” Digital enablement The productivity gains of yesteryear have run their new level of risk awareness and mitigation is essential
• “We have a digital-first culture.” course. The cost of labor is not abating, and offshoring, to building a ready and resilient workforce. They
Psychological safety • “I have access to the latest tech (e.g., Gen AI) near-shoring, and business process re-engineering acknowledge that as work becomes more complex,
• “I can bring my authentic self to work.” to do my job.” are no longer moving the productivity needle. it will be critical to simplify, engage and inspire their
Now, organizations have the opportunity to deliver workforce toward a digitally-infused future. It has
• “I feel empowered to make decisions • “My work experience is designed to bring out
technology arbitrage that can not only unleash the never been more critical to design for tomorrow,
independently.” the best in me.”
potential of their workforce but offer a new (and much plan for transitions, and cultivate a culture where all
• “Our work and work practices promote needed) cost and return landscape.4 Gen AI is here, and stakeholders can thrive in perpetual motion.
autonomy and dignity.” Skills growth and job security
• “I can voice my opinion openly without fear • “I will have a career at my company even if my
of repercussion.” job is eliminated”
• “My company helps keep my skills up to date.”

Drive human-centric
productivity
Solve the productivity equation with
AI, assessment and work design
Drive human-centric productivity

The rapid rise of human-machine teaming presents an urgent Figure 4. Given productivity is the #1 driver of transformation
opportunity to re-examine the productivity equation. The this year, what could move the needle?
new math must take into account AI’s ability to augment
C-suite question: Investment in which areas would give the biggest boost to
human capability, improve efficiency and fuel innovations in
productivity in your organization? (Select all that apply)
both business solutions and personalization of the employee
experience. But AI is only one side of the equation. Leading
Employee up/reskilling 51%
companies are complementing emerging technologies with
agile talent models and human-centric work design — both Physical and mental well-being initiatives 45%
crucial in reshaping how work gets done and quantifying the
value delivered by each worker. This requires deep insights into Process optimization & workflow management 44%
skills demand and supply, as well as investment in upskilling.
Keeping people at the heart of the productivity equation Generative AI 40%
ensures that the gains delivered will be shared by all.
Simplified organizational structure 37%
Cracking the code on productivity Workforce deployment platforms 34%
Following years of weak output growth and diminishing returns from

Cybersecurity measures to prevent disruptions 31%
traditional labor arbitrage,5 it’s no surprise that increasing productivity is
the number one driver of business transformation plans this year. The Self-service solutions for routine information 27%
pandemic sparked a more inclusive model of productivity — and executives
understand that a continued focus on workforce upskilling/reskilling, Workforce monitoring and feedback 25%
employee well-being, and process/workflow optimization will be required to
boost productivity in 2024 and beyond (see Figure 4). Work redesign efforts 22%

Now, organizations large and small are racing to Figure 5. The power of “And” — How Generative AI is augmenting jobs
capture the upside of “augmented intelligence.” Fifty-six
percent of executives see AI as a job creator in their
80% of today’s Most importantly,
organization (44% believe the opposite), but with
jobs are virtually all jobs Incremental
one in four saying that AI will fundamentally change
likely to be will see their core productivity
their business model, changes will permeate across all
affected by tasks change gain
jobs. Both executives and HR are grappling with one (10–30%)
Generative AI significantly
question: What will be the impact on the workforce and
the skills needed to compete? Generative AI is already
augmenting jobs at the task level and demanding a Substituted
Transactional
shift in skillsets (see Figure 5), ushering in a new debate by RPA + AI
around how best to measure, reward, and cultivate
19% of Transactional Augmented
human contribution.
jobs will by AI
If new technologies promise efficiency hikes, why do see 50% of
productivity gains remain so elusive? One reason is their tasks Relational
that tech deployments are not translated into new ways affected Human work
of working and not enough time is spent on helping
people make the change. Another is that traditional Relational
“hours-in, widgets-out” measures of productivity, while Augmented
easy to quantify, fail to reflect workers’ longer-term by AI
contribution.6 Many business leaders agree: One in Expertise
four executives say that today’s productivity metrics do Expertise Human work
not fully capture the value workers provide. And workers
themselves feel commoditized, with nearly two in five
Source: Today ~2027 ~2027
employees (39%) believing they are more replaceable 1
OpenAI, OpenResearch, and the University of Pennsylvania
and less valued than before the pandemic. 2
Brookings Research
3
Goldman Sachs Research, Reinventing Jobs: A 4-Step Approach for applying automation to work (Jesuthasan and Boudreau, HBR Press 2018)

Figure 6. Biggest drains on employee productivity

Employee question: What keeps you from being most productive at work?
(Select all that apply)
Too much "busy work" (tasks that don't add value) 42%
Too many interruptions / not enough “thinking” time 38%
Ineffective org structure (e.g., matrixed, siloed, etc) 35%
Workload that is too high/unsustainable 32%
Stress 29%
The past few years have an issue, they do point to poor non-value-adding work, and use holistic, impact-based measures
underscored the importance of work design, ineffective work of AI tools to improve skills/task of value creation. There has been Difficulty finding the right information/experts 26%
workers’ energy levels as a driver habits, and a desire for greater matching. Addressing poorly a recent shift at the top of the
of productivity. When asked what direction and feedback. AI and designed jobs and making work house: Executives are being held Too many meetings 23%
gets in the way, workers noted skills are part of the equation, but more attractive can mitigate more accountable for human
busy work, too many interruptions, moving everyone to new ways of productivity loss in the short term capital metrics that directly or Too much change 21%
ineffective organizational structures, working and creating space for and boost productivity in the longer indirectly impact productivity, such
Lack of direction and feedback 20%
and unsustainable workloads upskilling in the flow of work is term — allowing for junior-fication, as employee health and well-being
(see Figure 6) — with fifty-seven going to be critical to success. non-traditional hires, and more (50% of executives have this on
Inability to work when and where I work best 17%
percent of employees reporting widespread use of early/mid their scorecard, up from 40% in
Tackling these challenges requires
that they are working longer hours career moves. Sustaining a healthy 2022 and 21% in 2020), delivering on Being asked to learn/use new technologies 16%
increased attention to capacity
than ever before. While employees talent pipeline also requires a Good Work standards (43% this year),
planning, work design to eliminate
do not see a lack of autonomy as shift from badge swipes to more and employee engagement (40%). Lack of trust/autonomy to do my job 13%

Redesigning career pathways for a sustainable talent

pipeline at LONGi
How a solar technology and compensation management and position requirements. To LONGi’s talent development The internal talent growth rate
company centers skills to address inconsistencies which improve skills benchmarking, they model, “Learn, Test, Train, increased by 15 percentage points
development as a catalyst had impacted recruitment and transitioned from an iceberg model Practice, Assess,” promotes YOY (from 20% to 35%).
for growth career development processes, of competencies to a concentric practical experience, rapid
Ma Fuhai, General Manager of the
evidenced by managers’ uncertainty circle model. The new approach training, deployment and skills
As countries set climate goals to Human Resource Management
in outlining job requirements. aids internal and external talent development. Their holistic
reduce their carbon footprint, LONGi, Center, shares the upside:
LONGi couldn’t afford to lose selection by identifying core skills approach to performance
a global leader in solar technology, “By promoting the continuous
ground given the strict regulations and employee differentiators management combines typical
is expanding to meet this rising improvement of skills, a sustainable
surrounding product quality, so across 33 job categories and 121 performance reviews with
demand while navigating intense talent pipeline is established,
their HR Management Center sub-categories. This allows the project-based assessment, in which
competition. To fend off skills scarcity thereby ensuring the continuity
implemented a robust job grading team to assess performance, the project manager considers
and drive consistent growth, LONGi of business development. This
system and redesigned career paths values, potential, and ability using both individual and collaborative
re-evaluated their productivity achieves the triple benefits of
with a skills lens to better align with a talent review matrix and identify success. Ongoing “empowerment
equation and strengthened its talent skill enhancement, productivity
business needs. high-potential talent to support projects” (including job-related
pipeline, focusing on redesigning improvement, and future business
business-critical campaigns. training, job rotations, and
career pathways. As part of strategic workforce sustainability, laying a solid
LONGi also identified six key internal gigs) accelerate growth
planning, LONGi inventories talent foundation for the company to
leadership capabilities, which opportunities further. This focus
LONGi first added structure to job and skills by aligning business continuously innovate in the
form the basis for their leadership on internal skills development
grading, performance management, strategy, organizational capabilities rapidly changing market.”
development programs. over outside hiring is paying off:

Figure 7. Increasing productivity through intentional work design Designing work for by amplifying intelligence to enable
higher quality work. They see the
HR question: Which work design changes have you recently made or are planning for 2024? (Select all that apply) new demands
potential of human-machine
Fifty-three percent of executives teaming to mitigate some of the
Recently implemented Planning for 2024 Not on our roadmap project that AI and automation will most pressing talent risks of our
bring a 10-30% productivity boost time — constrained supply, rising
Defining which roles are most suitable to agile working 47% 36% 17%
to their organization over the next labor costs, ineffective talent
46% 36% 18% three years, and an additional mobility, low workforce energy
Identifying roles most suitable for job sharing
40% see an even greater upside. levels, and more. These benefits
Identifying skills/roles best served by gig/freelance workers 45% 35% 20% Estimates suggest that AI could will be realized only if work is
add trillions of dollars to the global designed around how humans
Identifying roles most suitable for hybrid/remote working 48% 37% 15% economy.7 While these figures want to work and their skills are
are alluring, productivity gains continuously nurtured at pace with
Quantifying the ROI of work design and/or tech investments 43% 40% 17%
will remain out of reach unless technological advances.
organizations take a fundamental
Bringing more roles back into the organization (in-sourcing) 43% 39% 19% To that end, 98% of organizations
look at how work is done today
are planning work design changes
Engaging in co-opetition (collaborating with competitors) 42% 37% 21% and actively redesign it for
in 2024, with increased productivity
a machine-augmented future.
Joining a talent consortium to share talent with other companies 41% 37% 22% as the main driver. Their recent
Employees report that one-third redesign efforts focused on
Outsourcing a significant portion of the workforce 42% 37% 21% of their work today is mundane and identifying which roles are best suited
repetitive, presenting an obvious for nontraditional work models and
Transitioning some employees to gig/freelancer status 38% 38% 24% reallocating work to different talent
opportunity for process and
cognitive automation. But AI holds pools (see Figure 7). HR leaders
Redesigning career models/pathways 41% 45% 14%
promise as more than just an in lower-growth organizations
Deconstructing jobs into tasks for reconfiguration 39% 41% 20% efficiency play. One-third (32%) of are more likely to say these work
executives believe AI will add the design changes are not on their
Moving more roles offshore 34% 40% 25% most value in their organization roadmap this year.

Thoughtful work design will broaden an organization’s challenging. Companies that are building a more
talent supply options, a critical advantage when 48% systematic approach have identified which roles are
of HR leaders see skills shortages as a top threat to best suited to fixed, flexible, or flow-to-work talent
their business this year. By deconstructing jobs and models and strengthened their underlying career
redeploying tasks to optimize work, organizations can architecture and skills taxonomy to enable more agile
create new jobs that reflect changing skills needs and ways of working. AI-powered platforms have made
make work more accessible to non-traditional talent. the fixed-flex-flow framework easier to operationalize,
but only 26% of organizations are using internal talent
Translating post-pandemic pockets of agility into marketplaces today.
a permanent “new shape of work” has proved
Fixed, flex, flow: Options for connecting talent to work
Talent fully flows to tasks,

Talent in fixed roles Talent in flex roles
assignments, and projects
• Jobs with pre-determined • Jobs with a proportion of time • Jobs with no pre-defined
volume of work designated for non-fixed tasks owner and work allocated on
a needs basis
• Jobs that demand consistency • Additional activities from
due to control/expertise internal gigs, marketplace • Bursts of activity aligned
opportunities, etc. to capability
• Stable roles that benefit
from workforce planning and • More fluid roles that benefit • Agile roles that benefit
managed job architecture from skills insights and talent from skills-based planning
deployment processes and credentialing
Adapted from: Work Without Jobs8

Flexible working continues to deliver industry is leading the way in moving to more onsite and 10% remote full-time (with an additional 10% ideal would be a 50/50 hybrid arrangement. Only 10%
work, But the majority of those making changes are remote most of the time). Interestingly, only 22% of wish to be fully remote — and this is consistent across
a productivity boost
more fully embracing flexible working for all. Their organizations are expanding their flexible working geographies, generations, and genders.
While it may seem that employers have finalized main driver is increased productivity, which aligns with options to better attract top talent, reflecting a shift
Taking a multidimensional view of flexible work is
return-to-office plans and codified their post-pandemic the 64% of workers who say they are more productive in employee preferences for “together time.” At the
key to increasing agility and productivity. This is
flexible working policies, in fact 41% are planning further when they work remotely. Other top drivers are end of 2021, a staggering 62% of employees said they
especially important when the nature of the job
changes this year. The good news is that conversations increased employee engagement and improvement in the would only join or stay with an organization if they were
does not lend itself to location-based flexibility
have moved beyond location-based considerations organizational culture. able to work remotely at least some of the time. This year,
(e.g., in the manufacturing, retail, or healthcare
to include other forms of flexibility. For the 10% that that number has dropped to 41%. Overwhelmingly,
Today, the dominant model is onsite full-time (38% sectors). Considering the where, when, what, who,
are moving to more onsite work, opportunities to learn people want some degree of social contact, with 46%
of workers, plus an additional 16% onsite most of how, and why of work expands the parameters and
corporate behaviors and increased cyber risks from preferring to work onsite most or all of the time, even if
the time), followed by 27% in a 50/50 hybrid model, makes it easier to take an “all roles can flex” approach
remote work are driving their decision. The technology their job could be done remotely, and 27% saying their
— opening up more possibilities for work redesign and
reducing the friction that prevents talent from flowing
to work. Incorporating flexible working into work
Six dimensions of flexible working
redesign can strengthen the employee experience,
diversify the workforce, tap into non-traditional talent
pools, and access new skills — making headway on
Where When What Who How Why attraction, agility and productivity in unison. There is
also greater acknowledgement that leaders and people
Alternative managers need to partner with their team members
Location and Hours and Job content Scaling and Mission and
workforce and in new ways, having more regular and proactive
infrastructure scheduling and sharing technology purpose
automation conversations on pay, flexibility and careers as both
work and personal circumstances evolve.

Unlocking productivity employees’ work style,

motivations, and cognitive
with talent intelligence Using talent insights to make more
abilities) and technical skills
informed decisions
A deep understanding of the work audits (including self-report,
to be done is one input into the proficiency scoring by managers • Enhanced insights for internal succession.
productivity equation; insight and peers, and hackathons) are 33% use psychometrics, simulations,
into the capacity and capability closing knowledge gaps, while technical skills assessments, and situational
of the workforce completes the big data, predictive analytics, judgment tests for internal talent decisions.
picture. High-growth organizations and AI are driving new insights
• Rise of technical credentialing. 30% use
are 1.4 times more likely to be about enterprise skills supply
technical skills assessments to fuel their
using assessment throughout the and demand. Together, this
talent marketplaces, with 25% of employees
employee lifecycle. With better talent intelligence can unlock
saying that their technical skills are being
talent intelligence, organizations latent productivity by better
validated when applying for internal gigs.
can more objectively match matching work to individuals’
people to work, yet less than skills and motivations, fueling • Increase in manager/peer validation for
half of employees (47%) say agile flow-to-work models, skills. 30% require validation of skills if used
their manager understands their and improving the accuracy of in performance reviews, and 24% require
current skills, interests, and skill strategic workforce planning. validation if used for compensation.
gaps and just 31% say they are Understanding people’s skills and
required to enter their skills into gaps is also vital to encouraging Emerging trends
a centralized database. employees to spend their
learning time in value-adding • Increasing skill visibility: Centralized
The world of talent insights ways — developing skills that are databases that give all employees access to
is evolving. Psychometric in-demand, pay a premium, and/or everyone’s skill information
assessments (that measure help them remain employable. • Well-being: Worker well-being assessments,
work habit self-insights and work culture audits

In addition to capability, productivity rests on having Shift from churn & burn to reskill
sufficient capacity — not measured in hours alone,
& redeploy with skills-powered
but also in capacity to learn new ways of working, to
have dedicated uninterrupted time to work, and to
organizations
optimally integrate life inside and outside of work. Armed with robust talent intelligence, leading
As the productivity equation shifts with greater employers are matching people to work using skills,
human-machine teaming, it’s never been more critical to not jobs, as the currency. Solving for skills shortages
move from headcount planning to skills-based strategic today and keeping the workforce employable tomorrow
workforce planning. Leading firms are mapping future requires intentional planning to effectively migrate
demand, modeling internal taxes on people’s time and talent from sunset to sunrise roles and avoid successive
quantifying needs in skills rather than FTEs. Improving rounds of “churn and burn” as demand shifts. HR
workforce planning is a top priority for HR leaders this leaders are predicting, on average, a 19% turnover rate
year (#3 globally), but the real advantage comes from this year (higher in the healthcare and construction
doing this in combination with work redesign. Together, sectors), with RIFs impacting, on average, 20% of their
these can unlock new ways of working, define the ROI workforce. There may be a disconnect here: 60% of
of tech investments on capacity, and more effectively workers trust their employer to provide a career for them
address forecasted talent shortfalls. even if their job is eliminated.
When the nature of work is changing rapidly and

in-demand skills are not available or affordable, building
a skills-powered organization will pay dividends.9 The
48% of HR leaders see talent crunch is requiring HR to take a “build from within”
approach, rather than relying on the “buy” strategy most
skills shortages as a top popular over the last five years. High-growth companies
threat to their business are already seeing the return, having invested more
in skills intelligence platforms, migrated to agile talent
this year practices, and gained leverage through increased use of
a variable/contingent workforce.

Pay-for-skills models Figure 8. Leading organizations are powered by skills

are finally incentivizing HR question: What approaches have been most successful in ensuring you have the skills you need in your organization?
skills development (Select all that apply)
What’s different this year is that 2020 (pre-pandemic)

Rewarding skill acquisition (e.g., course completion, certification) 45%
organizations are increasingly using = 38% #9 of 11
rewards, not just talent levers,
to address skills gaps. Forty-five Buying/hiring new talent with the required skills and/or experience 42% 2020 = 60% #1
percent of HR leaders report that
rewarding skill acquisition has Rewarding skill deployment (e.g., paying a premium for skills used) 39%
been the number one approach,
a dramatic rise from number nine Building via experiential learning
38%
(internal rotations, short-term projects, internal gigs)
in 2020 (see Figure 8). Even as
these practices have been gaining Paying for outside learning (e.g., tuition reimbursement) 34% 2020 = 12% Last
ground, they have a way to go in
reaching their intended audience:
Building via internal training 29%
Only 18% of employees say their
organization pays a premium for
Transferring by resourcing work with multidisciplinary teams 28%
critical skills. If too many workers
are left wondering “what’s in it
for me?”, upskilling and reskilling Borrowing skilled workers/leveraging the gig economy 21% 2020 = 45%
efforts will fail to deliver a return for
an individual or their organization. Acquiring skills via an acquisition or merger 20%

Executives see human-machine teaming

as a productivity game changer,
economists believe it will reshape
markets, and employees are already
experiencing the benefits firsthand.
Early productivity gains from AI and
quantum computing are enticing
(mostly due to short-term cost savings),
but it’s human-centric design — not
tech implementations — that will
unlock real productivity and innovation.
As the technology landscape moves
from written prompts to multimodal
large language models and domain-
specific knowledge applications, AI’s
ability to amplify human intelligence
will have a profound impact on hiring
and mid-career moves. Together with
more robust talent insights, diverse
voices and a focus on healthy work
habits, technology can be the catalyst
for productivity that benefits all.

Enabling human-centered change to create

a skills-powered organization at Arcadis
How a design, engineering people. The company’s journey opportunities to substitute, with courses on the internal Amy Baxendale, Global Capability
and consultancy firm is on calls for human-centered change augment and reinvent work, learning experience platform. and Workforce Readiness Director,
the journey to use skills- that leverages technology to build Arcadis aims to drive smarter ways The talent insights and trends sums it up like this: “Becoming
based practices and smart a skills-powered organization and of working using a human-centered Arcadis gathers from this talent a skills-powered organization
technology to accelerate cultivates future-ready skillsets. approach. This intends to drive intelligence will feed the company’s is about investing in Arcadians,
business and career growth career autonomy, allowing future strategy to win, grow and their unique skills, and their
A key part of the change is Arcadians to identify and step into retain exemplary talent. personal growth. It means creating
enabling employees to identify
Arcadis recruits for thousands roles that enable them to use their transparent and equitable access
their skills, create career paths, To foster the transfer of talent
of jobs annually, but with skills in different ways. Matching to diverse and personalized career
access personalized learning, and between teams, Arcadis will
approximately a third of leavers skills to tasks and connecting paths, learning experiences, and
apply for internal positions that establish governance around
citing a desire for greater career talent with internal opportunities opportunities that align with an
align to their skills, interests and skills-first practices to cultivate
opportunities, the business knew aims to translate into clear and individual’s personal ambitions.
career goals. a culture of talent mobility, where
they had to take action. The move empowering career paths for This will ensure we are in the best
every Arcadian has transparent
to a Skills Powered Organization employees, even if their work possible place to meet the needs
The journey to become a access to opportunities and
is central to the pillars of the changes due to AI or automation. not just of our people, but also the
skills-powered organization is encouraged to explore
company’s business strategy: digital In the early adoption phase, 56% of changing needs of our clients —
also aligns to the company’s opportunities where their skills
and human innovation, sustainable the employee test group accessed both now and in the future.”
“Standardize and Automate” are needed.
project choices and powered by our opportunities and 20% engaged
program. By identifying

Taking action
Threats to productivity Getting started (great for smaller employers) Suggestions to accelerate
Enterprise risks: 1. Establish AI governance and training for the workforce. Institute 1. Build the business case for new ways of working. Tap into
and enforce policies for the responsible use of emerging technologies human-machine synergy through work process optimization and
• Inefficiencies and missed growth potential
and use of un-gated large language models that can expose sensitive intentional work design. Deconstruct jobs into tasks; determine whether
from lagging or poor AI adoption
or proprietary information. Ensure human oversight where AI impacts each task is best handled by AI or humans (in fixed, flex, or flow roles).
• Increased liability stemming from errors people’s health, wealth and career prospects. Outsource or delegate non-core tasks (e.g., fiduciary duties).
and biases in AI outputs and changing data
2. Communicate openly with employees about how AI will impact work 2. Make skills the currency of work. Realign your people processes and
protection laws
models and talent strategies within the organization. Specify which roles business models around monitoring, acquiring, upskilling and rewarding
• More frequent data breaches and cyber and skills will be displaced, and which ones will take on new importance high-value skills (current and future). Create more gig-based work to
attacks due to remote working and in the future of work. Solicit and incorporate employee feedback into encourage versatile skill building and enterprise-wide talent sharing.
networked organizational designs your planning.
3. Increase workforce agility through fit-for-purpose job architecture and
3. Know your people’s skills and aspirations. Understand workers’ work models that enable alternative talent pools and flexible working
People risks skills and motivations through skills assessments to support strategic to quickly scale capacity up and down without adding FTE headcount.
workforce planning, career growth, and the acquisition of in-demand Earn worker buy-in on skills passports and internal talent marketplaces.
• Inefficiencies and missed growth potential
skills. Use psychometrics to inform hiring and succession. Set up retention-based talent pools to help manage skills scarcity and
from failure to adopt new work models
competition, and outsource specialized skills when demand outpaces
4. Embrace flexibility for all. While corporate culture and the nature of
• Unforeseen costs and skills obsolescence by buy/build models.
work does not always support offsite working, the where is only one
failing to up/reskill or underestimating the
dimension of flexibility. Consider potential variations in when the work 4. Incentivize productivity and share gains. Reward up/reskilling and
time/resources required
happens, who does it, what they’re doing, how it gets done, and why — encourage employees to find and share ways to boost productivity through
• Job disruption by AI and automation due to aligning to the company’s mission and purpose. Ensure knowledge AI and automation. Consider how gains can be redistributed to employees
poorly managed skill transition workers are not the only ones afforded flexibility. via bonuses, flexible schedules, additional time off or other rewards.

Anchor to
trust and equity
Foster a climate of trust through
fair pay, equity, and inclusion
Anchor to trust and equity

Trust fuels relationships. When trust is in the though still strong, has declined significantly over
room, even the most difficult conversations can the last couple of years. Today, 69% believe their
go well. In today’s business environment, value employers will do the right thing for society, down from
follows trust — leaders invest in the people 78% during the pandemic. Trust that employers will do
and projects they trust to deliver. “Putting the right thing for employees also fell, from 80% to 69%.
your money where your mouth is” serves as HR leaders see it too — 45% rate their organizational
a powerful message to the workforce. But it’s culture as low trust.
a two-way street, with employees wanting to

work for a “trusted brand” that they believe will
honor its commitments. Leaders, take note — In the 21st century, trust is complicated. The
employees’ trust in their organization is the latest research shows that roughly 30% of
strongest variable in influencing how energized U.S. adults say most people can be trusted,10
they feel at work, their sense of thriving, and a steady decline from previous decades.
their intent to stay. Technology has permanently changed people’s
relationship with trust — calling into question
the information from Google search results,
Trust: An intangible asset with Wikipedia pages, social media, and now
outsized value generative AI tools such as ChatGPT. In fact,
executives around the world have identified
Trust in organizations hit an all-time high in 2022 .
misinformation/disinformation as the top
Through listening, collaboration and empathy, much
risk over the next two years11 — especially
of the world came together in the face of crisis.
critical in the 2024 election cycle as more than
Companies invested in purpose and people throughout
half of the world’s population heads into the
the pandemic period, taking actions to serve the
voting booth.
greater good that resonated with employees. Now that
trust is wavering. Employees’ trust in their company,

Cracks in the foundation Notably, return-to-office mandates

and a perceived lack of autonomy
of employee trust
(hot topics in the past) were cited less
So what is eroding trust? Employees often this year.
point to broken promises — both
In today’s uncertain economy, power
on promotions, raises, and career
is shifting back to employers. The
opportunities (#1) as well as on
rising cost of living, job uncertainty,
stakeholder commitments related
and cost cutting that reduces
to sustainability and Good Work
rewards/benefits are top concerns
principles (#4). Failing to take
among workers. The result is that
a human-centered approach to
more employees report feeling
organization design can also impact
“stuck” — with employees in Japan
the trust equation (#2) — when
most likely to be unsatisfied with their
employees feel that the ground is
job but staying anyway (29%) but only
constantly shifting under their feet,
9% in Mexico feeling the same.
they may be less likely to fully buy in
to the changes and try to “ride it out” Too little turnover is as concerning
until the next restructure. A sense of as too much — especially against
equity is also intimately connected a backdrop of transformation
to trust. Increased pay transparency, plans that demand high energy
more scrutiny on pay gaps, and cost and commitment from workers.
of living concerns have pushed living Organizations are trying to nurture
wages, fair pay, and fair opportunity an engaged workforce with the will
into the spotlight — it’s no surprise and skill to transform, yet 42% of
that unfair/unequal treatment (such employees say that their employer is
as perceived favoritism, bias, and not meeting their needs (significantly
discrimination) also erodes trust (#3). worse than the 19% in 2022).

Benevolence, competence, and Figure 9: How organizations can build back employee trust
integrity build trust
Benevolence Competence Integrity
What actions can organizations take to address the
erosion of employee trust? The research in this area
is well established and validated.12 Psychologists have “I trust that you will do right by me.” “I trust that you know what you’re doing.” “I trust that you are telling me the truth.”
uncovered three factors for highly effective, trusted
relationships: benevolence, competence and integrity
(see Figure 9). All three matter; for example, you Employee view: Employee view: Employee view:
cannot make up for a lack of integrity by being more
competent and benevolent. 81% trust their manager to have their back 78% say that when someone makes a 34% believe that pay/promotion decisions are
(up from 66% pre-pandemic) mistake, it’s easy for them to recover (up made fairly, equitably, and without bias
Let’s take each in turn. Benevolence as a business from 62% pre-pandemic)
strategy means listening to employees, understanding 79% say that people trust each other at their
HR leader view:
what they want, designing work that brings out the
company (up from 67%) 48% say that their unique skills and
experience are valued
best in them, and including them every step of the way.
68% say their company designs work to bring 55% say that their org culture promotes
Job security is naturally the top reason that people stay genuine caring over “lip service”
at their current employer; this year, fair pay, positive
out the best in them 40% say that their current role aligns with
their motivations and makes the best
work culture, and growth opportunities trend next. use of their skills 31% share pay/ranges for all roles, and 17%
HR leader view: believe this level of transparency is critical
Investing in these areas demonstrates an organization’s
to attracting & retaining top talent
trust in its employees and willingness to commit to
54% say that decisions are made via top-down
Executive view:
their long-term success. mandates rather than co-creation
with employees 36% say their org culture is to trust decisions
to be made locally
47% say that continuous listening platforms
are a core component of their
EX approach

Competence goes both ways: only to decision making, but also shot up from ninth to first position,
leaders trusting that their people extends to admitting mistakes, a sense of belonging (40%) moved
have what it takes, and employees addressing concerns, and into second place, and feeling valued
trusting that their leaders are being seeking feedback for continuous for their contributions (37%) rounds
held accountable. If employees improvement. Through open out the top three.
feel that their leaders don’t have and honest communications,
faith in their abilities, they might organizations can strengthen
be right — three in four (74%) relationships with their people
executives believe that the majority and build a reputation as a great
of their workforce cannot adapt to place to work.
the new world of work (up from
Employees who trust their
Employees
61% in 2020).
organization are twice as likely to who can bring
Integrity is “walking the talk,” report they are thriving. This year,
consistency between words and what helps people thrive is notably their authentic
actions. Radical transparency can
help — especially on decisions
consistent across gender and
generation, with some differences
self to work
such as pay and promotion that by geography (see Figure 10). Saying are two times
matter the most to employees.13 that, the influence of Gen X and Gen
This underscores the importance Y is evident. Topics that have been more likely
of companies living up to their pay
philosophies, recognizing workers
important to these populations
over the last few years are now
to trust their
for their unique performance, trending upwards for everyone: organization
contributions, experience, and Working for an organization with a
skills. Transparency applies not purpose they can be proud of (45%)

Figure 10: What helps employees to thrive at work?
United South Middle Hong Southeast United

Global States Canada Mexico Brazil Africa East India China Kong Singapore Asia Japan Australia Kingdom Germany France Italy
1. Working for an org with a purpose I am proud of 1 1 1 1 2 1 1 1 1 1 3 1 1 2 1 1 1
2. A sense of belonging 2 2 2 2 1 2 2 2 2 3 2 4 2 1 2 2 3
3. Feeling valued for my contributions 3 3 5 3 3 5 3 3 3 2 4 3 3 3 3 5 2
4. Having fun at work 4 4 3 6 5 3 4 9 4 4 1 2 4 4 4 3 4
5. A manager whom I trust/who advocates for me 6 5 4 4 4 6 6 7 5 5 5 5 6 6 6 4 8
6. Tech to make my job easier / less mundane 5 6 7 5 6 4 5 5 6 9 7 8 5 5 5 7 5
7. My org supports a healthy lifestyle 7 7 6 9 9 8 7 8 7 6 12 7 7 12 8 6 7
8. Integrating my life with my work 9 9 10 8 11 10 8 6 8 7 6 6 8 7 7 8 6
9. Opportunities to learn new skills 10 8 9 7 7 9 9 12 10 11 9 9 9 10 9 14 10
10. Building wealth for the future 11 12 8 11 8 7 10 4 14 14 11 11 14 11 10 13 9
11. Leaders who set a clear direction
12. Working with the best and brightest
13. Ability to innovate/experiment
14. Autonomy/empowered to make decisions

Pride in the purpose Figure 11: Perceived values misalignment on sustainability is eroding employee trust
One out of every five employees who feel at risk = C-suite question: Which of the following social and sustainability best practices are in focus for your organization?
of burnout this year attributes it to a misalignment = Employee question: What do you expect from your employer on sustainability?
between their own values and the values of their
employer. Employees are increasingly looking to their
44% IMEA
organizations to prioritize social issues, diversity/equity 42% 42% 42% 42%
42% Europe
and environmental impact. Nearly all employees (99%)
expect their employer to pursue a sustainability agenda, 38% 38% 38% 41% US + Canada
41%
and one in three say that setting goals is not enough; 39% Latin America
38% 38%
they are demanding that leaders be held accountable for 37%
sustainability outcomes. 31%
30% 33% 30%
32% Asia
When asked what they expect from their company 29%
29%
on sustainability, employees’ top priority was offering 27% 23%
minimum health and well-being benefits to all workers
— yet only one-third of organizations have done so
(see Figure 11). Employees’ second priority was
sustainable investment options in retirement plans, which
was rated by HR leaders as one of the most effective
ways to make progress on ESG outcomes. Demonstrating
commitment to a greener, healthier, and more socially
responsible future helps to earn employees’ trust in
the organizational purpose. The challenge will be 48% 42% 38% 29% 22%
maintaining the momentum from the last few years —
over half of organizations (55%) have pulled back on ESG
Minimum health & well-being Sustainable investing options Living wage for all workers Accountability for Minimize environmental impact
due to societal and/or customer pushback, which could do
standards for all workers in retirement plans leaders/managers on of business operations
irreparable damage to employees’ trust levels.
sustainability outcomes

A sense of belonging While issues of race and gender are also the least likely to feel most of the time, with notable
continue to shape DEI efforts and energized, trust their company, and differences between Millennials
A strong EVP ties the company’s
Age is just a number experienced employees’
the employee experience, other feel valued at work. (79%) and Baby Boomers (69%), as
wealth of institutional
purpose and talent strategy to dimensions of diversity are often well as between managers/leaders A staggering 76% of
To widen their lens, employers are knowledge that much
employees’ personal experience overlooked. This year’s results (79%) and individual contributors employees report that they
expanding the objectives of their more important.
at work. Much of this comes down reveal that people with certain (70%). Importantly, employees have witnessed age-based
to fostering diversity, equity, and DEI initiatives to include fostering
disabilities are substantially who feel comfortable bringing discrimination at work. This HR leaders are aware of the
inclusion (DEI). Once a distinct a sense of belonging — whether
less likely to be energized at their authentic self to work are can impact both younger and problem, with 49% already
discipline, DEI now shapes the employees feel seen, heard,
work, feel positive about their two times more likely to trust their older workers. Misperceptions measuring and addressing
entire workforce agenda, and it’s and valued without needing to
workplace culture, and trust their organization and over five times abound: Younger workers age discrimination in talent
become even more important change who they are. A majority
organization — and are far more more likely to be satisfied with no are often underestimated decisions and a further 34%
given AI’s potential to deepen of employees (76%) feel they can
likely to feel unsatisfied at work but intent to leave. and undervalued, and older planning to start this year.
inequities.14 Both employees and be themselves at work always or
obligated to stay. Older workers workers are perceived as
HR acknowledge the positive With Gen Z expected to be
set in their ways or unable/
momentum: Only 4% of workers say the largest generation in the
uninterested to learn
that their company’s DEI practices workforce by 2035 and 86% of
Figure 12: Build trust by ensuring work works for all new skills.
leave much to be desired, and 98% of current employees planning
HR leaders report their company’s While RIFs used to take a to work past retirement age,
Employees HR leaders | Our DEI initiatives have led to…
DEI initiatives have produced “last in, first out” approach, intergenerational working will
concrete results over the last few now more tenured workers continue to bring together
My workplace has a diverse and inclusive culture An inclusive, fair, secure work deal for all are being targeted. This is a range of skill sets and
years. But the details paint a less
where different opinions are valued (47%) workers (42%) short-sighted: The rapid worldviews and make the
rosy picture of the true progress
made (see Figure 12). Notably, expansion of new technologies workplace a more complex
Our workforce diversity reflects the diversity DEI as an explicit part of our workplace identity
employees in India and South Africa has put a premium on digital environment to navigate.
of our customers and the communities in which and culture (29%)
are more likely to say their company savvy, but it should also make
we operate (36%)
has a clear DEI strategy (51% and DEI as a visible part of our external brand (25%)
50%, respectively), with employees Women and minority groups are
in France less likely to say so (33%). well-represented in higher leadership (32%)

Easing the burden in key employee life milestones

at Siemens Energy
How a leader in energy technology supports point at which employees felt the pinch was navigating worked with local HR to either introduce or extend
employees in the moments that matter multiple caring responsibilities, with Mercer research coverage that often went beyond the local statutory
finding that 74% of Gen X juggle care for both children requirements. Siemens Energy also considered
Across the globe, the pace of population aging and aging parents. Siemens Energy also wanted language, updating policies to better reflect the range
is accelerating. Juggling multiple caregiving to address bereavement by bolstering minimum of family structures and relationships across their
responsibilities (children and aging loved ones) standards of leave to support employees at a difficult workforce. For example, they de-gendered their family
alongside the demands of maintaining a career time. In recognition of each of these experiences, the leave policy and extended leave where it was previously
is becoming the norm for many people. Siemens HR team, along with the I&D (inclusion and diversity) only offered to the primary caregiver.
Energy was sensitive to this long-term challenge and council, developed a policy targeted at key Life Events.
the impact it has on employees who are feeling the “Awareness is always the first step towards inclusion,”
This led to inclusive parental leave, bereavement leave,
pressure in their personal lives. This fact informed says Daniel Eppinger, Head of Benefits and Pensions.
and family care leave, giving employees worldwide
a multi-year program to level up their approach to “Before you establish a minimum standard or a
a minimum standard in the event of childbirth or
employee leave on a global scale. global policy, take the time — we took more or less
adoption, the death of a close family member, or the
a year — to discuss what this will mean for each
need to care for a family member.
The approach sought to address critical milestones different region, society, and country, as part of
for different persona groups. A critical milestone for A key challenge was addressing the inconsistencies your preparation. Each of us has our own biases and
Generation Y for example was starting a family, with in current local HR policies to improve inclusivity and knowledge gaps which need to be addressed to better
Mercer research finding that 78% of this demographic ensure equitable access across the 80+ countries understand the different needs and challenges for
have caregiving responsibilities for children. The other Siemens Energy is present in. To do this, the team colleagues in each region.”

Feeling valued for my contributions Pay transparency, especially in job postings, is fast Figure 13: Why do people stay?
becoming an expectation (not to mention a regulatory
For employees, a big part of feeling valued at work is HR overestimates the importance of well-being programs and organization brand/reputation, and underestimates the
requirement in at least 10 U.S. states and 20 countries),
knowing that decisions are being made in a transparent importance of manageable workload and coworkers/people
yet only 38% of employees say their organization is
and equitable manner. Few decisions matter more to transparent about the pay/range associated with each job.
employees than how much they are compensated.
Rank Employees HR leaders Rank
This is especially relevant as employees are considering
Cost-of-living pressures and easier access to salary data a new opportunity — this is the point where they ask, 1 Job security Job security 1
are making more people question whether they are “Does it pay to stay?” Compensation data shows that in 2 Fair pay Fair pay 2
being paid fairly. 2023, merit increase budgets in the U.S. averaged 3.8%, 3 Work culture Work culture 3
the largest since the 2008 financial crisis.15 Employees 4 Learning opportunities Well-being programs 4
who did not change jobs received an average base
5 Flex working Learning opportunities 5
pay increase of 5.6% (including off-cycle pay changes),
6 Competitive rewards Organization brand/reputation 6
Trust impacts executives’ while job changers received an average base pay
7 Workload Flex working 7
decisions to leave increase of 16.4%. People not only want compensation
8 Coworkers/the people Competitive rewards 8
that reflects their contributions, but they also expect
C-suite executives are less likely than rank- pay equity relative to their colleagues. This is less about 9 Confidence in organization strategy Confidence in organization strategy 9
and-file employees to say they intend to stay market-competitive pay (which ranks as number six on 10 Health insurance Health insurance 10
with their organization this year (46% versus the list of why people stay, see Figure 13), and more 11 Leadership Organization making positive impact 11
68%). One in three senior leaders plans to about the perception of fairness. HR leaders are aware 12 Well-being programs DEI 12
leave in the next 12–18 months, and a further that fair pay is rising in importance, while other items 13 Organization brand/reputation Career advancement oppties 13
20% think they may be let go or see their role like flexible working are becoming table stakes. They 14 Career advancement Leadership 14
eliminated. Of those who do plan to leave, one also understand that compensation should not only be
15 Organization making positive impact Workload 15
in three cite a loss of trust in their organization. retrospective and reviewed at year-end; it is an ongoing
16 DEI Innovation 16
conversation that needs to reflect the changing value
17 Innovation Retirement options 17
of skills and reward loyalty on a continuous basis.
18 Time off Manager 18
19 Retirement options People 19
20 Manager Time off 20

employee listening and analytics to deliver the rewards Figure 14: Show me the money: Are companies giving employees what they want?
that employees value most.16
How are organizations rethinking rewards?
Personalization is not just about salaries and bonuses.
This year, 46% of employees said they would be What HR recently What employees say
willing to forgo a 10% pay increase in exchange implemented: would make a difference:
for additional well-being benefits (the top response) More types of rewards and personalization 51% 45%
and 41% cited increased employer contributions to
retirement/savings programs. Total rewards technology 45% 20%
A personalized approach is now more possible than ever

Getting paid more frequently 39% 17%
due to advances in AI. Another area that can benefit
from AI is simplification. While 45% of companies recently Individual pay-for-performance 38% 38%
implemented total rewards technology, there is still a
long way to go to eliminate superfluous pages, portals, Opportunity to increase earnings through more work 37% 34%
and platforms. A generative AI front-end can help to
create one place for employees to get the information Address internal pay gaps 35% 25%
Modernizing total rewards to better they need (e.g., health benefits) and the information
Make benefits more affordable 31% 31%
reflect how employees contribute they want (e.g., paid time off). No more time wasted
searching for the right tool or most recent data.
Pay transparency for all roles 31% 22%
When asked how their employer can improve their
compensation, employees first and foremost want A word of caution: HR may struggle to get attention
Cost-of-living adjustment 27% 27%
more types of rewards and the opportunity to personalize and funding to modernize total rewards. When asked
their package (see Figure 14). This request is not new (it which People initiatives would deliver the greatest
Skills-based pay 25% 23%
was the top ask in 2020 and 2022 as well) and HR has ROI, C-suite executives ranked enhancing pay practices
been listening, with 51% of companies having recently last from a list of thirty choices. And only 16% believe Team-based pay 21% 29%
implemented improvements in this area. But only 15% that failing to improve pay practices will expose their
have gotten hyper-personalized, leveraging advanced organization to considerable risk. Agile pay structure Holistic view of contribution Value people fairly Transparency and tech

Reimagining the EVP to strengthen trust and

belonging with WorkSafe Victoria
How a workplace health and WorkSafe Victoria recognized Despite the underlying challenges, While previous messaging focused Executive Remuneration Policy and
safety regulator is building the lasting shift in the there was remarkable alignment on the contractual elements of Classification Framework (they face
their new EVP around employee-employer psychological in values across persona groups. employment, the EVP project tighter compensation constraints
shared purpose contract, with people reimagining Many highlighted pride in the provides an opportunity to than private businesses). To stay
what they want from work and company’s purpose and impact showcase how WorkSafe Victoria attractive, WorkSafe Victoria leans
What do you value about working expecting more in terms of on the Victorian community, inspires, empowers and celebrates into the areas where their offering
here? How does it feel to play a vital safety, well-being, flexibility, and along with its commitment to DEI its people across the key areas of is most competitive: career,
role in your community? WorkSafe career development. Through through an active council and career development, well-being well-being, and leave entitlement.
Victoria, faced with a tight talent focus groups and data insights, employee-led networks. and shared purpose. By surfacing “Don’t underestimate the unique
environment, set out to better the People & Culture team their strengths, the reimagined EVP benefits your organization can
articulate their unique EVP and Another bright spot: Most
uncovered a rise in employee is set to reflect the strong sense of offer, or the importance of clear
redesign their total rewards employees trust the organization
fatigue, compounded by the belonging and pride that employees and frequent communication about
offering. This would allow them to cares about their well-being.
organization’s necessary changes feel, thanks to a shared purpose. said benefits,” advises WorkSafe
quickly recruit hard-to-fill roles and Engagement scores also showed
in focus during the pandemic. Victoria’s Culture Specialist,
improve retention where they were higher satisfaction with work-life The EVP promise also feeds into
It was also clear that people were Catherine Boyd. Organizational
being out-competed by greater balance compared to other recommendations for an updated
unsure how to leverage internal Development Manager, Elizabeth
flexibility and higher remuneration. public sector organizations, total rewards framework. As a
career opportunities. Bremner, adds, “You’d be surprised
another differentiator to public body, the business is subject how many employees are simply
leverage in the EVP. to the Victorian Public Entity not aware of what’s available.”

A living, breathing work contract Inequities of opportunity can show up across many
dimensions — including work location, with 34% of
Feeling valued isn’t just about salary and benefits. employees thinking that remote working will have a
Employees are getting better at evaluating the entire negative impact on their career prospects.
deal, and one of the things they look for is transparency
of opportunity. It’s concerning, then, that only one-third One way to democratize opportunities is to use skills
of employees think pay and promotion decisions in their as the currency of work. Companies have made
organization are made fairly, equitably, and without bias. significant progress: Today, only 21% of employees
say that career progression at their organization is
based on tenure rather than skills (an improvement from
36% in 2022). Getting the full value from a skills-based
talent model requires radical transparency and a
Employees’ trust in growth mindset — a belief that with enough effort
their organization is and support, people can upskill and add value in new
ways. Here, organizations have a long way to go: 36%
the strongest variable of workers say that job/project opportunities are visible
to everyone, and 32% say that promotions mostly go to
influencing how energized current employees rather than outside hires. It’s not just
they feel at work, their upward movement — three in four employees say that
horizontal and lateral moves are not prevalent in their
sense of thriving and organization and that their employer does not support
mid-career changes. Nudging people to make internal
their intent to stay moves will be critical to fueling sustainable growth.

Congruence between brand and employee experience has never been more critical to get right Organizations are looking for ways to connect talent
to work more seamlessly, and employees are eager
for more opportunities to contribute. Technology can
act as an enabler — talent marketplaces seamlessly
84% 65% connect talent to work, whether it takes the form of
of employees of employees trust gigs, projects, assignments, or full-time jobs.17 The
say their work Total their company to most effective talent marketplace platforms generate
Brand
contributes to a equity well-being provide them with workforce insights, recognize worker potential, and
worthwhile mission the latest tech recommend personalized and dynamic learning
Digital pathways that lead to future opportunity.
Customer and physical
experience workspace Ultimately, workers want to feel valued and like they
are getting a fair deal. There is a need for organizations
to partner differently with their people, less structured
Brand Human-
centric
Employee around annual reviews and more responsive to
experience values experience employees’ evolving needs. Organizations need to
stay in constant contact with workers and be willing to
renegotiate rewards, flexible working arrangements,
Work
skills development, and career paths as circumstances
69% ESG
and work 61% change. Line managers are critical to maintaining a
models
of employees trust of employees feel
living, breathing work contract and helping people
their company more valued (less
Good Work find their unique path. While most employees don’t
to do the right Rewards replaceable) at work
commitments and growth stay because of their manager, having a manager who
thing for society now compared to
advocates for them is in the top five factors that help
the last few years
them thrive. To shore up the foundation of trust, the
lived experience of employees needs to be constantly
shaped by leaders, nurtured by people managers, and
supported by a culture of human-centric values.18

Employees found their voice during the pandemic, and they’re not ready to give that up. As people have more options, the degree of trust they have in their company will be a deciding factor in their
reshaped their relationship with work, they depended less on their manager and built a more direct choice to stay or go. For organizations to preserve trust and for employees to thrive, the latter
relationship with their organization’s brand. When the economy shifts and workers feel like they needs to feel like they’re getting a fair deal and their full lifestyle needs are being addressed.
The evolution of the employee/employer relationship
Past focus: Past focus: Current focus: Future focus:

Retain Motivate Recover Energize
Loyalty contract Engagement contract Thrive contract Lifestyle contract

(transactional) (work and workplace centered) (whole person consideration) (LifeX — life experience)
Basic needs: Psychological needs: Well-being needs: Fulfillment needs:
Pay, Benefits, Security Achievement, Camaraderie, Meaning Purpose, Equity, Impact Choice, Connection, Contribution
Pay and benefits for time and output Broader set of rewards (pay, benefits, career, Healthy experiences in exchange for a commitment to Total rewards that include flexibility and employability
experiences) in exchange for organizational engagement organizational renewal in exchange for the promise of continued relevance
Workers are assets to be retained
Employees are assets to be acquired and optimized People and machines work together for maximum Partnerships across the talent and tech ecosystem for
value creation long-term people sustainability

Sustainable advancement of true pay equity,

diversity and inclusion at LSEG
How London Stock Exchange gaps — key to achieving its ambition (18.1%) were: role and location, underrepresented racial and ethnic Reward, Performance and EDI,
Group (LSEG) is moving the of bias-free pay. experience and business sector. While groups in senior leadership (14%) highlights: “As employers, one of
needle on pay equity pay gaps can be explained, this and LSEG aims to increase this to our key responsibilities is making
Driven by data insights, LSEG’s does not mean they can be justified; at least 25% by 2027. There was meaningful progress on equity,
One of LSEG’s sustainability plan of action aligns to their so LSEG set about improving also a steady improvement in the diversity and inclusion. People
priorities is creating inclusive sustainability goals. Even though representation and championing representation of women (currently therefore expect organizations to be
economic opportunity for all. As the non-identifiable gender pay career progression. This includes 40%), with a goal to maintain this on top of pay equity as part of wider
LSEG has grown in scope and scale gap (which may result from bias manager training to recognize and moving forward. Next steps include business initiatives. It’s an ongoing
over the last five years (including or inequity) was low at 1.5% and mitigate bias, and a development collecting employee ethnicity journey, so businesses need clear
via its acquisition of Refinitiv), the was not statistically significant for program focusing on Black, Latinx data globally, which can be data to measure their progress
company had to balance different ethnicity, LSEG reviewed pay and and ally leaders. Alongside this, challenging due to inconsistencies and action plans to address any
equal pay/pay equity reporting performance frameworks, policies their talent acquisition process and regulatory limitations. Over challenges. It takes multiple years
standards across 67 markets, while and processes to scan for inequity of includes diverse shortlists and time, LSEG will establish initiatives to get where you ultimately want to
addressing any pay discrepancies opportunity and began transparent hiring panels, and tech to ensure to address other elements of be, but we are proud of the steps
between the entities. LSEG went reporting of annual average job advertisements use inclusive diversity. Leadership accountability we are taking and progress we
beyond regulatory requirements, salary increases and bonuses. and gender-neutral language. is formalized by connecting DEI to have made so far. That said, we also
applying a level of scrutiny on The top drivers of the identifiable Group Strategic Objectives. know there is more to do and we
par with financial reporting to pay gap for gender (31.1%) and 2023 results are expected to will continue our focus and efforts
understand the “why” behind pay underrepresented ethnic groups maintain the proportion of Bola Ogun, Group Head of Total towards our goals.”

Taking action
Threats to trust & equity Getting started (great for smaller employers) Suggestions to accelerate
Enterprise risks 1. Make trust an enterprise-wide competence. Identify what it 1. Personalize the EVP. Offer a deal that reflects the needs and values of
means to be a trusted leader, a trusted advisor and a trustworthy your workforce. Use AI-powered people analytics to infuse your employer
• Brand and reputational damage from broken
employee/manager. Empower workers to make decisions that are brand with an inclusive and purpose-driven culture, and benefits that
promises around ESG and DEI impacting
value-based and aligned to the company’s belief system. excite a diverse talent pool.
attraction and retention of customers
and employees 2. Recharge the EVP by embedding DEI and belonging into all aspects of 2. Cut off inequity at the source. Tackle the root causes of pay, health and
your employer brand. Use internal labor mapping to pinpoint where the career inequities and put in place guardrails to ensure that AI doesn’t
• Investor impact and regulatory fall-out by
EVP is failing different populations, and use data to course correct. perpetuate them. Adapt HR practices to meet employees’ standards of
failing to abide by reporting regulations and
fairness and design for longer term health and wealth outcomes. Start small
human capital disclosures 3. Deliver full transparency by redesigning HR processes, policies and with regulatory compliance, but work toward comprehensive measures that
communications that emphasize the impact of transparency on achieving
• Business continuity risk and cost issues due offer a fair total rewards package to all workers, including part-timers and
business objectives.
to not managing total worker health freelancers. Ensure career accelerators such as international assignments
are accessible to all, especially women and underrepresented minorities.
4. Foster a sense of belonging. Create an environment in which people
People risks feel comfortable bringing their authentic self to work, enable managers 3. Boost workforce engagement by communicating the rationale for changes
to encourage diversity in all forms, and encourage everyone to solve in pay, benefits, promotions and expectations in advance. Take a persona-
• Loss of institutional/tacit knowledge due to business problems and openly flag concerns. Take a hard look at how based, intersectional approach across the employee lifecycle. Invest in
talent leaving at pace fairness is perceived by workers at all levels. engagement platforms that facilitate an ongoing dialogue with employees.
• Stalled transformations from talent 5. Celebrate employees’ contributions. Define what great looks like 4. Define your sustainability targets. Set clear commitments against
stagnation and low engagement at the individual and team level (goals and performance metrics). the WEF Good Work Standards or the UN SDGs. Consider providing
Invest in digital platforms to help colleagues and managers share
• Costs stemming from failing to proactively sustainable investment options in retirement and long-term savings
positive feedback and give public recognition. Ensure meaningful
manage pay equity gaps vehicles. Use climate transition and people sustainability metrics to stay
acknowledgement of value-adding contributions. on track with a multi-stakeholder agenda.

Boost the corporate

immune system
Build resilient cultures with teams that
are risk aware and healthy at the core
Boost the corporate immune system

If People risks are business risks, Figure 15: The business impact of not addressing People risks
it’s time to raise the alarm C-suite question: Which of the following People initiatives will most impact your business this year? (Select all) /
Top 10: Not addressing will expose us to considerable risk
According to the Global Risks Report,19 talent remains
a critical factor driving enterprise risk, with nearly every
country ranking skills shortages or unemployment as a Investing in AI tools and adoption 52%
top 10 concern. Workforce health continues to cause
business continuity challenges, with non-communicable Improving our sustainability, metrics, and reporting 46%
diseases (NCDs) accounting for 74% of worldwide deaths
The risk landscape is changing in unexpected
and stress-related illnesses on the rise.20 A company’s Mitigating the human elements of cyber risk 44%
ways, with risks exacerbating, intersecting, and
leadership and workforce practices also impact a
resulting in cascading effects. The imperative
company’s evaluation, according to asset managers.
has never been greater for organizations to Redesigning work to incorporate AI and automation 40%
Nearly nine out of 10 (89%) see workforce engagement as
operate as sensing organisms, alert and ready for
a key driver of company performance, and 84% consider
what’s next. New technologies disrupt in known Delivering on WEF Good Work standards 38%
a “churn and burn” approach damaging to business value.
and unexpected ways, extreme weather events Not all executives are alert to the consequences of
impact supply chains and workers alike, and Investing more in benefits to prevent/treat chronic illnesses 35%
not addressing People risks in their own organization
geopolitical tensions are high. Deepfakes feel real (see Figure 15): only one in three say that failing to invest
and misinformation permeates daily life. These more in benefits to prevent chronic illnesses (35%) and in Reducing stress-related illnesses and employee burnout 32%
realities impact each and every organization, reducing employee burnout (32%) will expose them to
and weigh heavily on the minds of their considerable risk this year. With eight in 10 employees Delivering on our DEI goals 29%
people. To thrive in an uncertain and volatile (82%) feeling at risk of burnout and the burden of NCDs
environment, leaders and employees need to impacting younger generations, the stakes are high and Improving benefit plan design, vendor selection, and communications 28%
shore up their risk mindset and build resilience the demand is greater than ever to proactively address
at both the individual and enterprise level. risk-exposing behaviors. Improving our workforce planning to better inform buy/build/borrow strategies 26%

The resilience factor: A roadmap for not be enough. To stay ahead of potential threats, leading Figure 16: The building blocks of enterprise resilience
organizations are scenario planning and fostering a
enterprise and individual resilience
mindset that is attuned to the evolving nature of risk. Resilient organizations are different from their less resilient peers in
Six in 10 executives (64%) believe their business can three important ways:
One important way to move from reactive resilience
withstand unforeseen shocks this year, up from four in 10
(the capacity to recover quickly) to anticipatory
in 2022. These resilient organizations (as rated by C-suite
resilience (reducing the impact of disruptive events) is
executives) are further ahead in building a risk-aware
by building a risk-aware culture from the ground up.
culture by investing in skills and structures that build
The challenge lies in balancing increased resilience with Their HR They They are
“readiness” and “response” teaming (see Figure 16).
agility in People models. Trust is key (leaders at resilient team advises empower skills-ready
Governance models and policies set the foundation organizations are 1.8 times more likely to say that their executives on decision with an
for risk awareness and mitigation. One example is an company places the right amount of trust in its employees), human capital making adaptable
organization’s cybersecurity program. There is reason for as is empowerment (resilient organizations are twice as risks and at the pipeline of
concern: Only 55% of executives are very confident that likely to make important decisions at a local level). opportunities local level talent
their company is constantly updating its cyber-risk protocols
Leaders clearly set the tone. Resilient organizations
to deal with new threats, with executives in the higher
education (62%) and automotive (61%) sectors more
are 1.8 times more likely to balance empathy and
economics in decision making. A case in point is how
1.9x 2x 1.4x
confident than those in financial services (46%) and life
they are preparing for the impact of new technologies.
sciences (45%). Even fewer (41%) say their employees are
Executives of resilient organizations are 1.3 times more
effectively trained in this area. Perhaps most concerning Setting
likely to say that jobs should be made redundant, not Driving Equipping
is that 54% of leaders say those responsible for their expectations
people amid the continued rise of AI and automation. expectations employees to
company’s cyber-risk program do not understand all of the through org
Reskilling and deploying workers whose jobs are through company deliver through
available options for risk mitigation and risk transfer. At a structure and
impacted by new technologies requires a growth norms and skills and
time when new technologies, networked organizational senior
mindset — yet less than half (46%) of executives rate relationships competencies
structures, and remote working are exacerbating data leadership
their organization’s culture as high on skills agility.
security concerns, traditional cyber-risk governance may

Enabling enterprise resilience with but net-zero and environmental goals that address
climate change are last on the list. The pandemic
insight and foresight
demonstrated the value of multidisciplinary teams
Evolving risks have the potential to grind businesses to tasked with scenario planning and empowered to
a halt overnight, and their enterprise-wide implications proactively act on risks. Diversity in the design team is
challenge traditional approaches to risk governance. critical to flag issues early and think through various
As an example, AI requires competence across all use cases. Tackling tomorrow’s challenges today
departments (not just IT) and constant monitoring of requires scenario planning and immersive techniques
new use cases. European laws on AI governance reflect that bring the future forward. Other approaches
this new approach to risk,21 requiring additional checks that are paying dividends include setting goals that
and balances for use cases that are deemed more risky address all stakeholders’ needs (see the WEF’s Good
(e.g., decisions that impact people’s health and wealth Work framework)22 and ensuring risk mitigation costs
outcomes). Timely, actionable intelligence is critical to are built in to business planning and P&Ls. It also
creating and sustaining a self-regulating culture that means empowering individuals to take action on
foresees and reacts to evolving People risks. To boost early warning indicators.
resilience, leading organizations are operating as
“sensing organisms,” where all workers are expected to
be risk vigilant and help shore up their organization’s
resilience in the face of new/evolving risks. Delivering
on this culture requires three important shifts.
Executives in resilient
Shift 1: Be proactive. Managing risk reactively
instead of proactively can increase an organization’s
organizations value
exposure. For example, executives say that extreme agility over efficiency
weather and natural disasters accelerated by climate
change strongly influence their three-year plans, and effectiveness

Shift 2: Be predictive. Increasingly Which human capital insights do Figure 17: What gets measured gets managed
sophisticated analytics and scenario executives believe would improve
C-suite question: Which insights would be most useful in helping you to understand your workforce? (Select up to five)
modeling can inform data-driven decision making? At the top of the
HR question: Which of the following data-driven insights do you make available today? (Select all that apply)
decisions on risk mitigation, list is understanding the leadership
transfer, and management. Shifting behaviors that contribute to thriving
from lagging metrics (such as and engaged teams — but only one Leadership behaviors that lead
engagement and productivity) to in two companies provides these to thriving & engaged teams
predictive analytics (such as worker insights today (see Figure 17).
Predicted productivity gains Impact of work models
capacity and well-being indicators) Notably, predicting burnout risk,
from AI & automation (part-time, remote, etc)
is key to staying one step ahead. which rose up to the number
on productivity
two ask from executives during
Although HR leaders have planned the pandemic, is back down to What helps different Most effective mitigation
to move toward leading indicators pre-pandemic levels. employees thrive at work strategies for workplace
for years, few have followed
safety & security risks
through. For example, in 2022, Shift 3: Be accountable.
Importance to executives
one in two said they would start Recognizing and reinforcing a Progress on closing skill gaps Most prevalent workforce
identifying employees at risk of risk-aware culture starts at the for critical roles health issues
burnout the following year, yet the top. This year, 50% of executives Identifying employees Identifying employee groups Underlying causes
percent who do so has remained have employee health and well-being at risk of burnout that have unmet needs related of pay inequities
at 42%. A similar pattern emerges metrics (e.g., healthcare costs, to pay, benefits, or retirement
with predicting when critical talent burnout rates, etc) on their
is likely to retire (44% do so today, scorecards, up from 40% in 2022 Adoption rate of newly Work factors that inhibit
not much higher than the 39% and 21% before the pandemic. implemented tech psychological safety
back in 2022). HR’s intentions are Interestingly, fewer executives
Retirement adequacy by
reflected in this year’s top priorities, are being measured on total labor
employee group
where improving people analytics cost (from 35% in 2022 to 23%
capabilities ranks fourth. today), which can signal a mindset Impact of different pay
shift that People investments strategies on retention
do pay dividends.
Predicting when critical
talent is likely to retire
Adoption rate by companies

Mitigating people risks with data-backed people

strategies at Mercado Libre
How Latin America’s largest data, including HRIS feeds, salary struggled to promote the culture, For example, Mercado Libre Likewise, 74% of developers plan
ecommerce and fintech benchmarks, engagement surveys, especially with so many new introduced a new employee to stay with the business for 3+
company identified the root office presence, team hierarchy, hires. As Hernán Jara, Director of benefit — a six-month “Work from years, with intent to stay rising
causes of employee turnover geographical distribution, rates of People Operations and Analytics, Anywhere” program — which by nine percentage points YOY.
and evaluated the true impact digital communication, and exit commented: “Leaders in Mercado many developers have taken Changing tides in the IT industry
of new work models interviews. Using both supervised Libre are not hired because they advantage of. And to address the helped, too, with competition for
and unsupervised machine learning can do, they are hired because they financial insecurity that young developers falling in the years after
Following a period of hyper-growth, techniques, they identified areas of can learn. They have behaviors and tech professionals face in Latin the pandemic. By using data as a
Mercado Libre’s workforce more higher attrition risk. values that align with our cultural America, Mercado Libre now hosts compass to steer their strategy,
than tripled. But as voluntary principles.” To maximize leadership financial literacy workshops and Mercado Libre is able to meet
Their analysis found that while
turnover began to creep up, effectiveness, they restructured IT pays this group partially in hard employees’ needs with sustainable
remote working did not hinder
reaching 15% in critical developer to bring managers geographically currency as a direct response to talent and reward practices,
productivity, it made it more
roles, they suspected it was driven closer to their teams, to cement employees’ needs. and tackle a myriad of risks that
difficult to sustain team culture,
by more than compensation. culture, drive development and influence turnover. Their approach
encourage desired behaviors, Not only has this combination
ultimately retain talent. strengthens the company’s
To test their hypothesis, Mercado and plan for succession. With a of initiatives brought voluntary resilience and enables Mercado
Libre leveraged Mercer’s predictive workforce distributed across 18 Results from the AI model also turnover down from 15% to 4% Libre to maintain its position as
AI model — feeding it insights countries, leaders who were not prompted a few changes to the in three years, engagement and a market leader.
from five years’ worth of HR geographically close to their teams company’s well-being program. quality of work are on the up, too.

Resilient organizations Leading organizations are auditing Figure 18: 46% of employees would give up a pay increase for additional well-being benefits
their culture for risk awareness and
prioritize total Employee question: Which of the following well-being offerings are most important to you? (Select all that apply)
resilience, and providing feedback
workforce health HR question: Which of the following do you currently offer to support employee health and well-being? (Select all that apply)
and coaching to employees on their
The resilience of every organization own overall well-being. They are
reframing health benefits not as a What employees say will make a difference, ranked % of companies that offer this benefit today
depends on the health of its
people.23 Long hours, key cost but as an investment in total
1. Work is designed for employee well-being 49%
person dependencies, and sick workforce health, as is evidenced
leave can be warning signs that by the fact that one in three 2. Awareness programs on difficult topics 50%
the workforce is distracted, executives would increase spend
disengaged, and depleted. Asset on employee benefits and well-being 3. Health screenings for early warning signs 51%
managers are taking note: One initiatives even if faced with an
4. Training on workplace safety issues 55%
in three say that an unsustainable economic downturn.
talent pipeline would negatively 5. Employer-funded spending account for well-being 41%
Which investments could make a
impact their view of a company
difference to worker health? First 6. Training on how to foster psychological safety 50%
from an investment perspective.
and foremost, employees expect
Healthy employees are more likely
work to be designed with their 7. Training to recognize mental health challenges 49%
to be present and productive,
well-being in mind (see Figure 18).
be able to cope with stress, and 8. Expanding benefits eligibility to more workers 44%
When it comes to stand-alone
avoid costly accidents. They also
initiatives, they think prevention
feel energized to invest in success 9. Apps/classes to support physical well-being 48%
and training will make the biggest
for tomorrow — whether that’s
difference, asking for health 10. Apps/classes to build resilience skills 46%
learning new skills, taking on new
screenings and programs to
responsibilities, or rethinking 11. AI-powered mental health resources 33%
improve their health both in and
ways of working that open up
out of the workplace.
opportunity and mitigate risk. 12. Genetic/genomic testing to mitigate health risks 34%
= Requested by thriving employees more than non-thriving

As the growing prevalence of mental Workplace safety With fears about future pandemics,
health challenges and NCDs leads to workplace violence, and widening
has evolved.
long-term absences, presenteeism, sociopolitical unrest, safeguarding
Have organizational
inflation of healthcare costs, and worker’s physical safety and
business continuity risk, prevention policies kept up? security is more critical than
remains high on HR’s priority list. ever. But a resilient culture gives
Ensuring safety at work is more
AI that helps employees make better equal priority to psychological
than a legal and moral imperative;
health choices is already in use at safety. Again, there is work to be
a safe work environment is part
44% of companies, and is on the done: Only 35% of employees
of the culture of care that every
2024 agenda for an additional 37%. strongly agree that they can voice
employee should expect from
Interventions such as vaccinations their opinion freely without fear of
their employer. Concerns about
and screening programs are repercussion, and only 42% strongly
risk contagion, extreme weather,
particularly critical for boosting agree that they feel psychologically
digital fatigue, and customer abuse
the resilience of vulnerable staff safe at work. Those who do feel
(to name a few) have expanded
segments at both the individual safe are 5.5 times more satisfied
the definition of what it means to
and community level. For example, with no plans to leave, and 2.1 times
feel safe. This year, companies are
employees with a disability — who more likely to recommend their
continuing to mitigate the risk of
are less likely to be thriving at work employer to a friend. Beyond the
work-related illnesses and injuries
(54% versus 68%) and at higher risk legal obligation, safety is good for
due to accidents, unsafe exposures,
of burnout (94% versus 79%) — are business: 70% of executives say
or security incidents. Despite these
also less likely to trust their employer that investing in psychological safety
efforts, 59% of employees say
to provide a safe working environment and workforce security will deliver
they feel safer working remotely
(66% versus 76%). a measurable return.
than onsite.

Money matters: pay and more than twice as likely to

have access to employer-sponsored
Building wealth at work
financial wellness advice and tools to
The cost-of-living crisis and model their future financial security.
persistent inflation have put financial
concerns front and center, and
With life expectancy slowly rising Thriving
employees’ financial worries are
again after the pandemic, people
don’t just want to live longer —
employees are
costing employers. Employees
spend, on average, six hours of work
they want to live longer better.25 5.5x more likely
Employers have an important role
time per month worrying about their
finances, the top driver of burnout
to play in ensuring quality of life to say their
risk this year. According to an OECD
for their older workers. While 21%
of Baby Boomers expect to stop
company helps
survey, 43% of people would run out
of savings within a month and 28%
working completely when they reach to alleviate
retirement age, just 9% of Gen Z
within a week if they experienced
a loss of income.24 The same study
workers feel the same. Across all their financial
found that only 45% of employees
age groups, 36% of employees say
that they will work past retirement
concerns
believe they are saving enough for
age out of financial necessity.
retirement, and they trust their
Flexible working and retirement
employer more than an independent
arrangements will allow workers
financial advisor to provide a good
to contribute across all life stages
retirement plan. Thriving employees
and help employers take advantage
are 5.5 times more likely to work
of older employees’ wealth of
for a company that helps alleviate
knowledge, yet only one in three
these concerns. They are 1.5 times
(32%) companies proactively offer
more likely to perceive that their
phased retirement options today.
company offers market-competitive

In today’s interconnected risk environment, Workforce health boosts the corporate immune system
every risk is a People risk. To minimize their
exposure, resilient organizations are acting
on the underlying causes of deteriorating
workforce health and fostering a culture of
care. They are boosting their corporate immune
system through strong governance and using Financial Career
data to foresee the outcomes and trade-offs
of business decisions. They are also building
individual resilience by creating a healthy
risk culture — the skillset and mindset in the
workforce to speak up and the willingness of Culture
leaders to empower their people to take action. of care
By taking actions to improve longer term Physical Social
health and wealth outcomes and nudging
people to make better decisions today,
organizations can tackle the structural issues
that deplete people’s ability to learn and thrive.
Emotional
Without this resilience, the transformative
potential of emerging technologies and new
ways of working will not be realized.

Promoting a watertight risk culture at APRA

How a financial regulator embeds imperative. In response, APRA created a new GCRA The study highlighted a gap between how comfortable
industry-wide risk awareness and resilience risk assessment process to support their supervisors employees felt to challenge decisions compared
and enable institutions to more effectively measure, to senior leaders, a concern given the criticality
The Australian Prudential Regulation Authority (APRA) monitor and report on risk culture. APRA’s Risk of psychological safety and its impact on effective
maintains the safety and soundness of financial Culture framework sets expectations for regulated change management. Knowledge gaps existed too:
institutions. Integral to this is their long-term goal entities across ten dimensions: Leadership, Decision Legal, Risk and Compliance employees were less likely
of raising industry-wide standards of governance, making & challenge, Communication & escalation, to believe the business had the budget, systems,
culture, remuneration and accountability (GCRA) to Risk capabilities, Alignment with purpose & values, skills, and/or capacity for effective risk management
ensure businesses can make informed decisions, Risk culture assessment & board oversight, Risk compared to executives.
protect employees, avoid pitfalls and deliver appetite & strategy, Risk governance & controls,
sustainable growth. Responsibility & accountability, and Performance The new framework and survey rollout allow
management & incentives. APRA-regulated entities to better identify priority
APRA recognized that when risk management practices actions to strengthen processes, guided by the need
and accountability differed across businesses, critical To enhance the framework’s impact and gather to ensure the voice of risk is heard, accountability is
risks could slip through the cracks. APRA also suspected benchmarkable data, APRA ran a pilot survey with 10 defined, and employees are empowered. Strengthened
that technology employees in particular might not fully multiline insurers, before expanding it to 60 insurers, by its improvements to risk culture assessment,
understand their risk management responsibilities, banks and superannuation funds. The survey rollout APRA continues to support the financial industry’s
raising questions about cyber security, a risk that would reimagined their approach to risk assessment by giving risk readiness, embedding resilience into each
only become more critical. voice to all employees, rather than senior executives institution’s DNA.
only. The broader range of perspectives led to a better
In a decentralized management structure, embedding
understanding of each entity’s risk culture and the
a business-wide risk-aware mindset was a growing
implications for its success and reputation.

Taking action
Threats to resilience Getting started (great for smaller employers) Suggestions to accelerate
Enterprise risks: 1. Give everyone responsibility for risk awareness. Empower local 1. Design for total workforce health. Prioritize safety and well-being across the
offices and individual contributors to flag and address risks in real time. employee lifecycle. Centralize benefits management to be globally consistent,
• Neglecting to cultivate a culture of risk
This often requires more training and intelligence-sharing across the locally relevant, and optimized for less waste and better take-up. Promote
management that mitigates exposures due
organization, but reduces the burden on upper management to approve healthy lifestyles and preventive healthcare to manage long-term costs.
to disruptive technologies, supply chain
decisions and ensures everyone is poised to act in response to threats.
disruptions, extreme weather events, and 2. Foster a risk mindset by keeping all stakeholders informed and
other risks 2. Free up space for what matters most. Outsource and automate accountable. Quantify exposures to threats like cyber, climate and AI, and
• Systemic blind spots due to inadequate risk non-core services that can take resources away from your business use scenario planning to keep crisis management plans up to date. Apply
sensing and scenario planning objectives and people strategy. This may include total benefit vigorous risk assessment to potential M&A targets.
management, outsourced investment services or other areas that
• Lagging metrics that inform on past health, 3. Contribute to workers’ financial security by offering financial planning
give leverage.
wealth, and safety events but do not predict advice and calculators to model scenarios such as retirement and
future risks, nor serve to drive better outcomes 3. Rally the organization around a few key metrics that measure value surprise expenses. Provide at least a minimum amount of insurance
and contribution. Pull back on the nice-to-haves and focus resources on against key life risks.
People risks: what’s required, ensuring that everyone pulls in the same direction.
4. Monitor leading indicators (including People analytics) and leverage AI
• Fatigue, errors, and burnout caused by 4. Join a risk consortium / AI roundtable to stay abreast of rapidly tools to predict and mitigate risks before they happen. Build these risk
inadequate staffing levels changing regulations and advancements in AI and data privacy/security, metrics into executive scorecards to incentivize progress.
and to share mitigation strategies.
• Rising health and benefit costs 5. Think bigger on climate resilience. Responding to climate change and
• Lack of diversity leading to increased 5. Regularly audit your work climate and worker habits. Conduct weather events goes beyond concerns about infrastructure, corporate
groupthink, decreased innovation and a resilience review and/or worker well-being assessments to understand travel and logistics. Consider if employee benefits and the healthcare
overlooked/ underestimated risk exposures the true health of your people and business practices. system more broadly are equipped to ensure business continuity in the
face of climate catastrophe.

Cultivate a
digital-first culture
Design an adaptive, digitally fluent
organization where people can thrive
Cultivate a digital-first culture

Everyone is chasing
organizational agility,
individual and enterprise
resilience, and long-term
people sustainability. To make
progress on this ambitious
agenda, organizations need
to learn how to “Be Digital.”
Aren’t all companies “digital”
these days? Not exactly —
being a fully digital enterprise
means cultivating a culture
that promotes human-machine
teaming in how people learn
and collaborate, how data is
harnessed, how innovation
is encouraged, and how
decisions are made. This new
era of connected-up working
also requires a reimagined
HR function with the ability to
iterate and align processes that
fully unlock workforce capacity.
Doing so maximizes the
potential of both humans and
technology — for the benefit of
the organization and its people.

Digital by design: feel overwhelmed by too many Figure 19. Tech spend: From collaboration & control to insight & connection
tech tools — the #4 reason for
Transforming, inspiring, C-suite question: In what areas have you prioritized technology spend?
employee burnout.
and enabling
Truly “being digital” requires a 70% Invested in the past 3 years Plan to start/continue investing in 2024 Not on our agenda
Two-thirds of executives (65%) say
future state vision, business strategy
that their organization needs to be
alignment, and full commitment.
more digital than it is today, and 59%
It is a cultural mindset coupled 56%
31% see technological disruption as 55% 54%
with intentional, interactive work 53% 53% 53%
the biggest short-term threat to 50% 50% 50% 49% 50%
design. The people side of digital 48% 47% 47% 47%
their business this year, significantly 45% 45% 44%
transformation can be harder to get
ahead of compliance issues (18%)
right than the tech side. One in six
and environmental concerns (15%).
HR leaders report that their recent
Asset managers agree — they rank
HR digital transformation initiatives
changes in the tech landscape as
were not successful. Why? Because
a top short-term risk to business
67% of organizations adopt new
success this year. Companies
technology without transforming
across every industry are working
the way they work. Executives are
to close the gap: 51% are rolling
concerned about how tech is being
out new tech this year (see Figure 6% 5% 5% 5% 6% 6%
rolled out in their organization: 3% 3% 4% 4%
19). Having access to the systems
Nearly three in five worry that
and tools that make their job
the rapid pace of tech innovation is Collaboration Cybersecurity Tech for Tech to Tech to AI-powered Enhanced Apps to Modern AI-driven
easier and less mundane is a key
surpassing their organization’s ability tools tools efficient and improve support skill insights / employee monitor listening talent
enabler for employees across all
to reskill and redeploy their workforce, (e.g., Zoom, cost-effective employee governance internal communi- employee tools insights
geographies and industries, and
and that their organization is not Slack, Teams) HR health and and talent cation tools productivity (e.g., digital for strategic
it is one of the top 10 factors that
doing enough to inspire workers to operations well-being regulatory marketplace focus groups, workforce
helps them thrive. But on the flip
adopt new technologies. compliance pulse surveys) planning
side, one-third of workers (32%)

Human-centered technology keeps Moving from reactive HR processes and band-aid Figure 20: Thriving employees are more likely
tech to HR systems that understand human behavior to trust their organization to:
people coming back for more
and anticipate employees’ needs will jump-start
A human-centric approach to digital transformation productivity. This requires more sophisticated 2.6X — Design work experiences that bring out
measures success in human terms, not technological commitment to continuous listening and empathy, and the best in them
ones. Does the tool or platform fulfill an unmet need? human-centered tech designed with an authentic UX
2.8X — Empower them to make decisions
Does it seamlessly integrate into the flow of work? Is that delivers results and is a joy to use.
independently and work with minimal oversight
the human-tech balance right? Digital solutions that
enhance productivity and alleviate pain points make 2.4X — Provide them with the latest technologies
What is different about digitally
work more intuitive, frictionless, and enjoyable. This (such as generative AI) to do their job
requires attention to both the logical and emotional
inclined employees?
aspects of change. If new tech is hard to learn or use, Employees who enjoy experimenting with new
if there is little governance to ensure alignment with technology are 1.6 times more likely to say that they are digital consumers in their personal lives.26 They expect
other tech and processes, or if it fails to integrate into thriving compared to digital laggards (75% versus 48%), their digital experiences at work to help them find the
the natural flow of work — it is set aside. Thoughtful and 1.7 times more likely to be satisfied with no plans answer, connect with others, and make things easier.
change enablement plays an important role in to leave their current employer (66% versus 38%). But Unfortunately, marked differences exist between
reframing perceived threats and painting a picture of these digital pioneers are not sure about the promise of workplace tech and consumer tech. At nearly two in
what can be. Done right, “being digital” can actually AI — overall, only 27% of employees expect that AI and/ five organizations (38%), the technology available for
make an organization more human — knowing its or automation will improve how their job is done over employee use is not as leading edge as the technology
people, anticipating their needs, and responding in a the next three years (with no meaningful differences provided to customers. This chasm appears when
way that helps them thrive rather than dragging them between digital pioneers and laggards). implementation teams create processes rather than
down (see Figure 20). Delivering on this vision requires journeys, and when they focus on the technology itself
a radical rethink in how organizations are designed and Regardless of their comfort level with new technologies, as the experience rather than designing for the human
a re-alignment of the HR function and HR agenda. employees from Baby Boomers to Generation Z are all experience of work.

Managing business risks in a digital world With two in five organizations already using AI • People risk
in HR processes, care must be taken to avoid Anxiety is creeping in as AI augments and disrupts
The rise of AI is ushering in new enterprise risks and inadvertently biased and discriminatory outputs jobs in every industry. While the percentage of
demanding robust governance that often surpasses that perpetuate or deepen inequalities. A lack employees who fear that AI will make their job
legislative requirements.27 AI — particularly when of transparency and traceability puts the onus redundant has declined from 53% in 2022 to just
used as a general, all-access tool — requires risk on organizations to defend AI-based decisions 10% today, more than double (21%) are concerned
awareness to be embedded in the organizational not only from legal challenges but also from that advances in AI will raise expectations and put
DNA. Many AI-related risks are extensions of familiar public scrutiny. pressure on them to work faster or produce more —
exposures, such as cyber attacks, data privacy in turn increasing the risk exposure.
breaches, misuse of technology, and copyright • Technological convergence
infringement, that have been on the risk register for The combination of AI and mixed reality
The threats are real, yet 23% of organizations
decades. But there are also new threats emerging technologies such as AR and VR blurs the
implementing AI do not have any risk mitigation in
from AI solutions: line between the physical and digital worlds,
place. For the benefits of AI to outweigh the costs,
making it challenging (sometimes impossible)
• Unintended use and bias organizations need a robust and holistic framework
to differentiate between artificial and human
AI, especially generative AI, can develop to identify emerging risk factors, measure key risk
creations. Democratized access to AI shifts
capabilities that its creators never envisioned. indicators, and work across organizational silos to
this issue away from the IT department and
While emergent capabilities can provide new put mitigation strategies in place. An intentional and
empowers less informed leaders and employees.
benefits to users, their lack of predictability makes continual change enablement plan helps to de-risk
Since policing individual usage is untenable, risk
them especially tricky to govern.28 Similarly, AI’s transformation efforts and ensure that AI fulfills its
awareness becomes an essential organizational
lack of “explainability” can expose businesses potential as a net value creator.
competency. With one in five organizations
to significant risk, especially when “black box” providing no employee training on the proper
AI models are being used to inform sensitive or use of AI, there is still more to do on the
consequential areas such as credit assessments, mitigation front.
medical diagnoses, and talent decisions.

A digital-first, human-centric approach new employee listening tools in the past three years
and 53% are planning to invest in 2024. Creating an
to a winning EX
environment where employees are encouraged to
Shifting digital transformation from technology-led to speak up, propose solutions, try new things, and fail
human-centered requires a broader appreciation of fast is just as essential. High-growth organizations are
the employee experience and a rethink of what defines well-positioned for successful digital transformation
success.29 Human units of productivity can no longer be (see Figure 21). They are not only more digitally
the central tenet of digital ROI. To measure success in competent (with two times more digitally savvy employees
a digital enterprise, the focus should be on enhancing than low-growth organizations), they are also more
how work gets done. Today, six in 10 employees say networked (less siloed) and more willing to experiment — Figure 21: Eight habits of digital organizations
that their organization is not good at communicating doing so with democratized decision-making authority C-suite and HR leaders: Combination of several questions related to organizational culture
how AI or automation will improve the way they work. and simple user journeys.
Low-growth organizations High-growth organizations
Understanding employee needs is essential to The top barrier to transformation is insufficient
cultivating a digital-first culture, as evidenced by deployment of new technologies — a concern for 51% of
15% 20% 25% 30% 35% 40% 45% 50%
the fact that 45% of organizations have invested in executives this year, nearly double the 26% in 2022. This
is true across all industries, and especially a concern for Value thinking 36% 45%
executives in the technology and life sciences sectors. Data fitness 32% 44%
Organizations are increasing their investment in digital
Radical simplicity 36% 43%
transformation, but there comes a point of diminishing
67% of organizations returns. To avoid over-engineering, a common Network orientation 21% 42%
approach has been to roll out minimum viable products
adopt new technology (MVPs) — but these can lead to disengagement as
Distributed authority 39% 41%
without transforming the they fail to hit the mark. Leading organizations are
shifting to minimum lovable products (MLPs) that don’t
Digital competence 18% 41%
Changefulness
way they work just meet employee expectations but aim to solve a
36% 40%
problem with a sense of delight. Digital commitment 27% 36%

Sustainable HR digital transformation backed by skills

at SuMi TRUST Bank
How digital transformation enabling the bank to effectively plan about what to focus on and how to introduce a talent management significantly reduce the workload of
at a leading bank and and nurture the specialized talent it integrate multiple specializations platform, chatbots, and inquiry and both employees and HR, bringing
trust company is fueling needs for future growth. This was set in addition to the basic knowledge application management tools. the dual benefit of improving
company-wide skills utilization against a backdrop of company-wide of Trust banking”, employees were business results and increasing
The introduction of the talent
digital transformation which struggling to consider potential employee satisfaction.
Sumitomo Mitsui Trust Bank (SuMi management system allows the HR
required the HR team to improve career paths due to insufficient data
TRUST Bank) is a financial institution team to collect data on skills (general, Head of HR, Natsuhiko Yonezawa,
their own digitalization, as well as to measure their expertise against.
that houses a range of business management, and specialized) as shared, “Even if we introduce
reassess company workflows to
functions, such as commercial To address these issues, the HR well as competencies and conditions, cutting-edge technology, its
boost productivity.
banking and trust businesses, department set out to reform to better assess the capabilities of effectiveness is nullified if we
under one structure. Maintaining Initially, it was difficult for HR the HR system and operations, all employees. This means improved can’t utilize it properly. Therefore,
their competitiveness, which to assess skills shortages and including by establishing a digital management of the transfers of it’s crucial not only for the digital
stems from their diverse range which business strategies could promotion team in HR, consisting hundreds, sometimes thousands, of promotion team but also for the
of business functions, requires a be considered based on the of HR talent with high digital employees every quarter. The system entire HR department to enhance its
skills-ready talent pool, yet multiple company’s talent portfolio. In literacy to champion digital ways of also aids HR in succession planning, operations. Furthermore, in order to
departments were facing labor addition, while the HR team defined working. Through business analysis and helps employees autonomously promote continuous digitalization,
shortages. In response, SuMi TRUST autonomous career-oriented talent and interviews with a range of develop their skills. Alongside I believe it’s important to maintain
Bank’s HR team focused on making as “individuals who create their own employees inside and outside this, the introduction of chatbots a team within the HR department
employees’ skills more visible, careers by thinking for themselves HR, the team formulated plans to and other technologies aims to that is permanently responsible for
IT digital promotion.”

leaders redesign their function to have a greater Figure 22: Taking HR’s impact to the next level
impact this year, their top priority is to implement new
HR leaders: What plans are in place to redesign the HR function in 2024? (Select all that apply)
technology (45%), with over one-third (36%) creating
a new role/team dedicated to generative AI. Given 60%
Low-growth organizations High-growth organizations
of executives are concerned about losing the human
10% 20% 30% 40% 50%
touch after implementing digital tools, it’s no surprise
Implement tech to redesign HR service delivery 43% 47%
that high-growth companies are re-organizing their
HR structure, practices, and interactions to get the Use flow-to-work model for HR resources 29% 43%
tech-touch balance right (see Figure 22).
Create a new role/team focused on Gen AI 21% 40%
Evolving the HR function for a digital age requires not Organize talent populations rather than HR disciplines 18% 36%
only the right skillset, but also a mindset that puts
Centralize HR administration services (shared services) 32% 36%
How HR teams are transforming to data at the center of decision making. Most executives
(63%) believe that advances in AI and automation are
support a digital-first culture Move to high-touch personalized interactions for key groups 11% 31%
changing the profile of a successful HR professional —
If one objective of digital transformation is and an ongoing analysis of global market data shows Use distributed hubs for HR service delivery 21% 29%
future-proofing the organization, people sustainability that tech skills rank #1 for professionals across nine HR Increase self-service solutions 27% 36%
is a critical element. For people to thrive in the new specializations.30 But difficulty attracting and retaining
shape of work, HR needs to design tech-enabled HR talent with digital skills remains the number one Outsource or co-source parts of the HR function 21% 24%
experiences that deliver on this promise. As HR challenge facing HR today (see Figure 23). Expand the use of global benefits management tools 7% 24%
Figure 23: Top five challenges facing the HR function
HR leaders: What are the biggest challenges with your current HR operating model? (Select all that apply)
44% Attracting and retaining HR

talent with digital skills
43% Balancing the need for insights
with data security and privacy
42% Implementing or upgrading
new HR technologies
33% Delivering the right balance of
self-service and human support
32% Coordination between HR
functional silos/COEs/HRBPs

The HR operating model and work-tech ecosystem will planning. Each of these HR disciplines has its own alarmist news headlines — can cause existential angst.
need to evolve in tandem to enhance the employee agenda, experience design, and success metrics. For One in three employees are concerned about the rise of
experience (EX) in the reality of whirlwind perpetual example, the talent acquisition team will measure time AI and its impact on humanity, and one in four say that
change. Defining the desired interactions between to hire, cost per hire, and quality of hire. But do their AI is creating job uncertainty. Taking a human-centric
HR and different persona groups can help design measures of success align with the broader people approach to digital transformation means infusing
engaging EX journeys and bring together HR and IT agenda? This might mean skill detection and alignment technology into the flow of work and never losing sight
to deploy tech features that can enhance productivity to the business, time to velocity and overall retention, of the people who are being asked to change.
and relevance in the workplace. Target Interaction and thriving at work become better measures of
Modeling is a way to scope out the range of HR success. These are important shifts for any organization
services needed, ensuring fluidity and helping desired to make if it is to become a truly digital enterprise,
changes resonate and stick.31 When considered in full, and they require a mindset shift before any tech
these types of commitments and interactions among is even considered.
varied functional, leadership, and employee groups
demonstrate how employee listening, alignment and
Shifting from a
How to make change feel natural
well-planned change initiatives create cultures that are
when it’s anything but
process-driven to
digital-first while remaining human-centered.
How does an organization become equipped
a human-centric
The same principles that fuel digital empowerment
in employees also apply to the HR model. Consider
to perpetually transform? Maintaining employee mindset is one of the
commitment during constant upheaval and combating
the natural overlap and intersections among talent
attraction, talent acquisition, job and skills architecture,
change fatigue is a significant concern for nearly top transformation
career management, performance management,
one-third of HR leaders. New technologies — especially
ones, like generative AI, that lend themselves to
challenges this year
learning & development, and strategic workforce

Reinventing the employee experience for the digital

age at Sagility
How a healthcare servicing rethink. They flipped the paradigm — was the enhanced collaboration the business better data to guide the length of the hiring process
company reimagined HR thinking first about the populations between geographically diverse strategic decisions. One example and being able to instantly connect
processes to create a truer each process would serve and how HR teams, laying the foundations is the introduction of “bot-based with candidates using AI.”
picture of employee data and interactions could change. for continued global knowledge hiring” to support the recruitment
This transformation is an
deliver a seamless EX sharing and problem solving. of 20,000 roles annually. By using
The team started with EX 18-month work-in-progress
AI to guide entry-level candidates
Sagility’s legacy HCM platforms workshops and employee personas When communicating to the with further changes ahead;
through job openings, screening
were not fulfilling modern EX to define pain points and map them workforce, Sagility followed a “start a reflection of the nuance and
and assessment, the bot reduces
requirements. Siloed data prevented against the capabilities of different with why before teaching the how” global collaboration this scale of
the process from weeks to a matter
HR teams from fully leveraging platforms. From there, they created philosophy. Cross-region champions change requires. Manish Dubey
of hours. Internal recruiters only
employee insights, while employees a compelling vision for a superior and an employee learning center reiterates: “To deliver this level of
get involved at the interview and
were overwhelmed by multiple EX — a critical step in engaging with video and simulated events transformation, you need a team
offer stages, leaving more time for
platforms that lacked cohesion. executives in the case for change. detail the new processes and offer with techno-functional mindsets,
strategic work. As Manish Dubey,
technical training on Workday, the where they understand not
Head of Enterprise Technology,
To address these challenges, Sagility The rollout was “glocal”; although new HCM platform. only business processes but the
notes, “In the Netflix Age, for the
established a new partnership 80% of HR processes were technologies that underpin them.
younger generation in particular,
between HR and IT. In addition to standardized, local entities Sagility’s vision leverages a variety HR and IT need to work together,
instant gratification is often the
modernizing their HCM, they knew could flex for country-specific of technologies, conversational AI, have healthy disagreements, and
only way. Our entire design is
that every HR process needed a nuances. One unexpected and traditional desktop apps to create collective solutions.”
based on this concept, by reducing
benefit of this transformation minimize user input while giving

Successful transformation is an infinity loop (see Figure 24: How leading companies are reshaping the digital experience
Figure 24). It starts with a clear strategy that defines
the need for change and aligns leaders on what Conduct EX design Invest in employee
success looks like. It brings together all stakeholders workshops with portals and/or
— most of all, employees — to co-create a desirable employees chatbots
future that everyone can get behind. It requires 36% 30%
constant communication to set expectations
and mitigate risks, enabling understanding and
dep
gy
acceptance. Keeping in touch with people early
te l
and often allows the organization to hold itself tech
implementation
accountable, watch for warning signs, and iterate as
oy
a
needs change. Bringing employees on the change
str
m e nt
journey and ensuring that they experience the benefits
every step of the way are key to generating excitement
and sustaining momentum for change.32 If HR is
looking for one way to make a difference this year, let
ac
it be in using human-centered design to super-charge
tiv
adaptable human-machine workflows and activate
a winning experience for the digital age.
at
be n t
tterm e
io
n
Revamp
Implement total rewards
continuous Focus on packages
listening/feedback “moments for different
platforms that matter” personas
47% 26% 34%

The path to “being digital” is

both cultural and structural.
It starts with understanding
the human experience
of work and realigning
around the outcomes
that will drive sustainable
success. It continues with
reimagined employee
journeys and personas to
design better work. HR plays
a critical role in shaping this
human-centric future state
vision and strengthening
the organization’s adaptive
muscle. Only then will leaders
have earned the right to
consider the technologies
that can fuel, optimize, and
sustain the organization for
years to come.

Digital metamorphosis in HR delivery

at Avery Dennison
How a manufacturing firm is evolving from The new technology centered around a consistent consistency and governance of data to enable stronger
digital novice to digital powerhouse digital experience and offered a single access point workforce analytics. Moving standout talent into this
for employees while arming HR with digital tools to new team has cemented its internal reputation. The
Faced with HR service delivery and data gaps, support a global workforce. GWO team acts as digital torchbearers, championing
heightened employee expectations, and a decentralized continuous improvement and a digital-first,
HR operations model, what began as a desire to move Success is measured by how each interaction in the EX-centered mindset.
off their current Human Capital Management (HCM) portal adds value, looking to ensure the true experience
system quickly evolved into a multi-phase digital score reflects a HR operating model that is built around The GWO team is also central to digital and cultural
transformation. Avery Dennison realized a digital-first employees. For this reason, traditional SLAs such as integration of acquisitions, standing firm on the
approach, with employee experience (EX) at the core, speed of resolution are not the primary goal. Instead, company’s digital principles and migrating key
would be key to success. employees share feedback not only on whether their processes early on to ensure a digital-first EX.
query was resolved, but how the experience made
While continuing to use their legacy HCM suite, “We are seeing success on this journey because we
them feel, with 92% reporting a positive experience so
Avery Dennison envisioned its desired future state: truly believe that by looking at the employee experience
far. This feedback, along with usage data, influences
new ways of working for HR and a modernized EX. as the primary benefit, we can do more in engaging HR
new features in a continuous cycle of improvement.
While the team prioritized digital processes, they in the digital transformation,” says Chassidy Rellinger,
recommended an optimized mix of tech and human Avery Dennison is establishing a digital powerhouse Vice President, HR, Enterprise Workforce Solutions
touchpoints for a new HR service delivery model and across the HR organization. They centralized core & Operations. “You get the benefit of engaged
an integrated employee service and knowledge portal. services in a new Global Workforce Operations employees, and still ultimately get efficiency and
(GWO) center of excellence, responsible for ensuring productivity as an output.”

Taking action
Threats to digital empowerment Getting started (great for smaller employers) Suggestions to accelerate
Enterprise risks: 1. Encourage AI adoption with clear policies that empower people to 1. Evolve the EX to provide a frictionless, digital experience for employees
experiment. Train employees to use AI responsibly and hold them in the moments that matter — from costly medical bills to milestones
• Increased cyber attacks and other risks accountable when it matters — but also give them the space and the like family planning and retirement. Transform the HR tech stack into
resulting from human error and ineffective psychological safety to learn from mistakes. a centralized resource hub that offers AI-powered consumer-grade apps.
oversight of AI adoption
2. Make informed tech investments. Start by conducting a technology 2. Shift from know-it-all to learn-it-all. Invest in accessible knowledge
• Failure to deliver on the ROI of tech audit that focuses on usage and ROI. Identify gaps and be clear on must- management systems and social connectivity tools that maximize the
investments due to poor change enablement have specs to avoid over-spending on cutting-edge capabilities you don’t reach and impact of your company’s intellectual capital. Empower
need, or opting for more affordable tools that never get used. employees to share innovative ideas and recurring challenges
• Return erosion on institutional investment
through learning circles.
programs due to operational and 3. Build digital skills via internal gigs and exchange programs to give
execution risks employees more exposure to new technologies. Helping people feel 3. Develop a digital-first mindset that nurtures curiosity, experimentation,
comfortable and confident with AI will free up time for more strategic, and collaboration. Co-create with employees to ensure AI tools and other
People risks: high-value and enjoyable work. new tech are designed for their day-to-day work.
• Change fatigue and burnout caused by 4. Publicly promote the company’s digital capabilities through 4. Unlock the potential in your existing tech investments. Audit how
ineffective pacing of digital transformation roadshows and permanent public displays. Demonstrating the impact of current platforms are working together today and what is needed to
your digital-first solutions and making it tangible helps create a new level develop “minimal lovable products” for tomorrow. Blueprint future ways
• Sluggish technology adoption due to lack
of employee engagement and buy-in. of working and the desired level of “tech” and “touch” to deliver more
of take-up by key populations
intuitive and inspiring work experiences.
5. Align the HR function to meet today’s workforce needs. Take a
• Employee turnover due to dissatisfaction
customer-focused approach to what different populations need from HR and 5. Manage change effectively and communicate with purpose. Take the
with a lagging digital experience
understand what trade-offs people are willing to make. Translate needs opportunity to reconsider and redesign programs and processes rather
and wants into everyday experiences by mapping the target interactions. than simply moving them online.

Workforce 2.0
We are on the precipice of a significant leap in how we Unlocking human potential in today’s machine- upskilling and well-being. Staying ahead will require a once-in-a-lifetime opportunity to press pause on
work and live — ushered in by advances in AI, new work augmented world requires a new set of organizational balancing economics and empathy in the pursuit of business-as-usual and redesign work around people:
models, and a greater openness to what’s possible. competencies. Companies that are leveling up to productivity, building a foundation of trust and equity inspired by what they’re good at, aligned to how they
The excitement is palpable. It is also true that society Workforce 2.0 are placing their bets on enhanced to combat a growing sense of uncertainty, boosting want to work, and informed about the future to keep
faces more near-term risks and the darkest longer term human-machine teaming and entering into a new organizational and individual resilience, and inspiring them healthy, energized, and employable.
prognosis in decades. The fear is real. “lifestyle contract” with their people that focuses on digital enablement. The next couple of years present

About us
Mercer partners with organizations to build brighter futures.
Ask us how we can help drive Ask us how we can help Ask us how we can help boost the Ask us how we can help cultivate
human-centric productivity by: anchor to trust & equity by: corporate immune system by: a digital-first culture by:
• Redesigning work for • Building value-based brand • Increasing risk awareness and • “Being digital” rather than just
human optimization equity to attract & retain readiness for what’s next implementing technology
top talent
• Increasing agility with enhanced • Ensuring a healthy and • Evolving the employee
workforce analytics • Ensuring fairness and sustainable talent pipeline experience through HR
transparency in pay, health functional transformation
• Accelerating with • Using workforce science
and career opportunities
skills-powered organizations to anticipate and • Enabling and communicating
• Creating a positive impact mitigate exposures change to deliver ROI
• Outsourcing or delegating through sustainability
non-core services such commitments and actions
as investment management

Survey demographics (C-suite, HR leaders, and employees)

Company size Geography Company type
6% Non-profit / NGO
10% Over 20,000
8% 10,001–20,000 Government agency

21% or state-owned enterprise
15% 5,001–10,000
31% For-profit single country
44% 1,001–5,000
42% For-profit multinational
23% 500–1,000
Industry
Auto Chemicals Con- Consumer Energy Financial Healthcare Higher Insurance Life Manu- Media & Professional Retail Technology Transport
struction goods services education sciences faturing comms services & logistics

Survey demographics (employees)

Non-binary (1%) Customer Facing (12%) Executive (11%)
Manager of
managers (12%) Individual
Trade Worker Contributor
(20%) (38%)
Female (47%) Gender Job type Job level
Male (52%)
Knowledge
Worker (68%) Manager of Manager
department/function of others
(17%) (22%)
Baby Boomers (7%) Less than 1 year (7%)

Remote (21%)
Gen Z (15%)
1 to 2 years (18%) 3 to 5 years (32%)
Onsite (43%)
Generation Tenure Work location
Gen Y (52%)
Gen X (26%) Over 10 years (20%)

Hybrid (36%)
6 to 10 years (23%)

Further reading and references

1 Marsh McLennan and World Economic Forum. 8 Jesuthasan R and Boudreau J. “Work Without Jobs,” 17 Mercer. Building and sustaining a thriving talent 25 World Economic Forum and Mercer. Living Longer,
The Global Risks Report 2024. Available at Frontiers (2021). Available at sloanreview.mit.edu. marketplace, 2023. Available at www.mercer.com. Better: Understanding Longevity Literacy, 2024. Available
www.marshmclennan.com. at www.mercer.com.
9 Mercer. The 2023/2024 Skills Snapshot Survey report, 18 Bravery K, Jesuthasan R, Swift M, et al. The
2 World Economic Forum. The Good Work Framework, 2023. Available at www.mercer.com. human-centric enterprise, 2023. Available at 26 Oliver Wyman Forum. A-Gen-Z Report: What
2022. Available at www.mercer.com. www.mercer.com. Business Needs To Know About The Generation
10 NORC at the University of Chicago. The General Social Changing Everything, 2023. Available at
3 Bravery K, Anderson K and Bonic I. Work Different: Survey, 2022. Available at gss.norc.org. 19 Marsh McLennan and World Economic Forum. www.oliverwymanforum.com.
10 Truths for Winning in the People Age, New York: The Global Risks Report 2024. Available at
Wiley (2023). Available at www.mercer.com. 11 Marsh McLennan and World Economic Forum. www.marshmclennan.com. 27 Mercer. “3 ways companies can mitigate the risk of AI
The Global Risks Report 2024. Available at in the workplace,” 2024. Available at www.mercer.com.
4 Fersht P and Gupta S. “Services firms are out of www.marshmclennan.com. 20 World Health Organization. “Non-communicable
runway. They must forget labor arbitrage and diseases,” 2023. Available at www.who.int. 28 Kim J, Eskins G. “Generative AI: Understanding the risks
conform to technology arbitrage,” 2023. Available at 12 Mayer R, Davis J, Schoorman F. “An integrative model and opportunities,” 2023. Available at www.marsh.com.
www.horsesforsources.com. of organizational trust,” The Academy of Management 21 Bravery K, Karwautz S, Anderson K. “What the EU AI Act
Review, Volume 20 Issue 3 (1995), pp. 709-734. Available means for HR,” 2024. Available at www.linkedin.com. 29 Mercer. The next EX: Unlocking workforce energy, 2023.
5 The Conference Board. “Global Productivity Growth at www.jstor.org. Available at www.mercer.com.
Set to Disappoint Again in 2023,” 2023. Available at 22 World Economic Forum. The Good Work Framework,
www.conference-board.org. 13 Mercer. 2023-2024 Inside Employees’ Minds study, 2023. 2022. Available at www.mercer.com. 30 Mercer. “Mercer Skills Edge,” 2024. Available at
Available at www.mercer.com. www.imercer.com.
6 Sigelman M. “Building a Skills Engine for the Human 23 Mercer Marsh Benefits. “Managing people risk,”
Economy,” Innovations: Technology, Governance, 14 Mercer. “AI and DEI,” 2024. Available at 2024. Upcoming. 31 Mercer. “HR Target Interaction Model: Unlocking
Globalization, Volume 13 Issue 3-4 (2023), pp. 4-14. www.mercer.com. the employee experience,” 2022. Available at
24 Organisation for Economic Co-operation and www.mercer.com.
Available at direct.mit.edu.
15 Mercer. “Are we returning to normal compensation Development and International Network on Financial
7 McKinsey. The economic potential of generative AI: practices?” 2023. Available at www.mercer.com. Education. OECD/INFE 2020 International Survey of Adult 32 Mercer. Embrace change: It is here to stay, 2022.
The next productivity frontier, 2023. Available at Financial Literacy, 2020. Available at www.oecd.org. Available at www.mercer.com.
16 Mercer. “Five strategies to future-fit your total rewards
www.mckinsey.com.
programs,” 2023. Available at www.mercer.com.

Acknowledgements
We would like to recognize everyone from across the Mercer and Marsh McLennan community who contributed to this year’s Global Talent Trends Study. A
special thank you to Arcadis, Australian Prudential Regulation Authority, Avery Dennison, London Stock Exchange Group, LONGi, Mercado Libre, Sagility, Siemens
Energy, Sumitomo Mitsui Trust Bank, and WorkSafe Victoria for sharing their stories. We are also grateful to Man Bites Dog for their thoughtful input, Mercer’s
Creative team for guidance on design, Adrienne Cernigoi and Polly Webb for editing support, and Anton Rehrl for the original photography. And of course none
of this would be possible without the involvement of over 12,000 employees, HR leaders, C-suite executives, and investors who participated in the 2024 study.
Core team Contributors
Kate Bravery Senior Partner, lead author Jason Averbook Gord Frost Himani Kathuria Ted Patchet
Joana Silva Strategic Projects, co-author Ilya Bonic Lewis Garrad Carolina Klint Graham Pearce
Jens Peterson Content Writer, co-author Callum Burns-Green Aditya Gupta Nikhil Kolthankar Stephanie Penner
Saminda Dhillon Program Manager Eduardo Córdoba Kavitha Hariharan Amy Laverock Maurizio Quintavalle
Dawid Gutowski Graphic Designer Ana Costa e Silva Deena Harvanek Joe List Karen Shellenback
Anca de Maio Global Activation Lead Gina Fassino Rich Hewitt Alexandra Maher Charlotte van Bouwel
Molly Proefriedt Research Coordinator Sayka Fatima Julie Humphries Jean Martin Ivette Vargas
Ellie Green Client Liaison Will Ferguson Mike Giacobbe Adriana O’Kain Jess Von Bank
Kate Janota Senior Marketing Specialist Brian Fisher Ravin Jesuthasan Ashwini Pandit Alex Zea

At Mercer, we believe in building
better futures.
Together, we’re redefining

the world of work, reshaping
retirement and investment
outcomes, and unlocking real
health and well-being. We do this
by meeting the needs of today and
tomorrow. By understanding the
data and applying it with a human
touch. And by turning ideas into
action to spark positive change.
For over 75 years, we’ve been

providing trusted advice and
solutions to build healthier
and more sustainable futures
for our clients, colleagues
and communities.
Welcome to a world where

economics and empathy make
a difference in people’s lives.
Copyright 2024 Mercer LLC. All rights reserved.

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Workforce 2.

Mercer Global Talent Trends 2024 2

Mercer Global Talent Trends 2024 3

Mercer Global Talent Trends 2024 4

Drive human-centric productivity

Cracking the code on productivity Workforce deployment platforms 34%

Following years of weak output growth and diminishing returns from

Mercer Global Talent Trends 2024 6

Mercer Global Talent Trends 2024 7

Figure 6. Biggest drains on employee productivity

Too many interruptions / not enough “thinking” time 38%

Ineffective org structure (e.g., matrixed, siloed, etc) 35%

Workload that is too high/unsustainable 32%

Mercer Global Talent Trends 2024 8

Redesigning career pathways for a sustainable talent

Mercer Global Talent Trends 2024 9

Mercer Global Talent Trends 2024 10

Fixed, flex, flow: Options for connecting talent to work

Talent fully flows to tasks,

Adapted from: Work Without Jobs8

Mercer Global Talent Trends 2024 11

Mercer Global Talent Trends 2024 12

Unlocking productivity employees’ work style,

Mercer Global Talent Trends 2024 13

When the nature of work is changing rapidly and

Mercer Global Talent Trends 2024 14

Pay-for-skills models Figure 8. Leading organizations are powered by skills

What’s different this year is that 2020 (pre-pandemic)

Mercer Global Talent Trends 2024 15

Executives see human-machine teaming

Mercer Global Talent Trends 2024 16

Enabling human-centered change to create

Mercer Global Talent Trends 2024 17

Mercer Global Talent Trends 2024 18

Anchor to trust and equity

a two-way street, with employees wanting to

Mercer Global Talent Trends 2024 20

Cracks in the foundation Notably, return-to-office mandates

Mercer Global Talent Trends 2024 21

Mercer Global Talent Trends 2024 22

Mercer Global Talent Trends 2024 23

Figure 10: What helps employees to thrive at work?

United South Middle Hong Southeast United

1. Working for an org with a purpose I am proud of 1 1 1 1 2 1 1 1 1 1 3 1 1 2 1 1 1

3. Feeling valued for my contributions 3 3 5 3 3 5 3 3 3 2 4 3 3 3 3 5 2

4. Having fun at work 4 4 3 6 5 3 4 9 4 4 1 2 4 4 4 3 4

5. A manager whom I trust/who advocates for me 6 5 4 4 4 6 6 7 5 5 5 5 6 6 6 4 8

6. Tech to make my job easier / less mundane 5 6 7 5 6 4 5 5 6 9 7 8 5 5 5 7 5

7. My org supports a healthy lifestyle 7 7 6 9 9 8 7 8 7 6 12 7 7 12 8 6 7

8. Integrating my life with my work 9 9 10 8 11 10 8 6 8 7 6 6 8 7 7 8 6

9. Opportunities to learn new skills 10 8 9 7 7 9 9 12 10 11 9 9 9 10 9 14 10

10. Building wealth for the future 11 12 8 11 8 7 10 4 14 14 11 11 14 11 10 13 9

11. Leaders who set a clear direction

12. Working with the best and brightest

13. Ability to innovate/experiment

14. Autonomy/empowered to make decisions

Mercer Global Talent Trends 2024 24

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Mercer Global Talent Trends 2024 26

Easing the burden in key employee life milestones

Mercer Global Talent Trends 2024 27

Mercer Global Talent Trends 2024 28

A personalized approach is now more possible than ever