CHROs' insights connect the dots between the world of work and the U.S. economy. In partnership with Chief Executive Group, SHRM continues to monitor these leaders' perspectives on the economic outlook for business in the coming year.

Conducted in May 2021, this quarterly survey of 186 CHROs reveals optimism for growth and development in the coming year but moderates these expectations with cautions on employee engagement and mental health.

As Q2 COVID-19 rates receded and the number of people getting vaccinated climbed, CHROs said they expect the business environment to be ripe for growth:

• 95 percent of CHROs project business conditions to be good to excellent a year from now.
• 63 percent of CHROs anticipate a workforce expansion.
  

The past 18 months have presented monumental challenges to public health, society, politics and the economy. As progress has been made, HR leaders have shown confidence in the economic recovery even as the pandemic continues to shape much of daily life.

Several HR professionals recently shared their views on what's ahead for them for hiring, how they are handling employee engagement, mental health and other outlooks.

Employee Turnover Rate Increasing

Workers are reassessing their career directions as the pandemic progresses. Meanwhile, business is looking to put leadership in place to properly manage growth and shore up their ranks to stave off the next crisis.

Stacey Berk, Founder and Managing Consultant at Expand HR Consulting, said the majority of its clients are seeing higher levels of turnover than during the past 18 months.

"The shift slowly began in late spring 2021, and momentum is gaining fast," Berk said. "This may hit especially hard for employers across several sectors during the fall hiring season. How bad is it? Exit interview trends and research that we have seen show employees are leaving for better jobs, better pay and more fulfilling opportunities. Stemming from the strong U.S. labor reports this summer, we have heard staggering figures that 50 percent of all employees are actively looking on job sites and networking."

Berk is encouraging CEOs and HR executives to redefine who they consider part of the company's workforce. She said the workforce should be defined as including employees, temporary hires, independent contractors and vendors, not just employees.

"They all now need to be part of the equation of how to support the organization's strategic goals," Berk said. "Revisit the employee referral program. Increase the bonus amount and add more incentives to encourage employees to refer good people. Heavily market the employee referral program each time there is a job opening. Track this as part of your cost per hire."

Greater Need for Automation Skill Set

Nellie Thompson, Chief People Officer at Nintex, said her company "absolutely" anticipates adding staff in the next six months.

"Nintex is hiring to support the growing market demand for automation," she said. "In fact, we're rapidly growing across our global locations with specific focus on welcoming new team members into our product, engineering and sales organizations."

She sees business conditions improving and believes companies will look to automation to become more efficient and raise profit margins.

"More than ever before, organizations are looking at how they operate and looking to automation to help address inefficiencies and to propel their business forward," Thompson said. "We have more than 10,000 customers worldwide who rely on our technology to digitally transform their business processes."

Maria Clyde, SHRM‑SCP, Director of Human Resources at B&H Insurance, said staffing is a priority right now.

"Most of my small to midsize businesses are looking for administrative support, whether that be HR or finance. They need people to do the daily grunt work, data entry, onboarding and offboarding, payroll, reconciliation, etc. I haven't seen much of a need for the strategic leadership positions."

"Also, there's a need for skilled labor in the trades. The job market has probably hit them the hardest as they cannot find [employees] and people stop showing up," she said.

Retention, too, is expected to be a key issue for the next six months. Berk said, for CEOs, "it will be versatility with communication, policies and practices that support maintaining employees."

Working parents, females and minorities will continue to be impacted by the challenges of yet another uncertain school year, Berk said. "There's a focus on greater flexibility, expanded mental health initiatives and adding savings plans to benefits offerings."

Employee Engagement Trending Downward

Employee engagement has seen a significant drop since the beginning of the pandemic:

• 51 percent of CHROs rated employee engagement as high or very high, a 3-point decrease from the pre-pandemic proportion that gave it the same rating.
• 12 percent of CHROs rated employee engagement as low or very low. 

Only 27 percent of CHROs indicated improved employee engagement since prior to pandemic, and 31 percent indicated a decline.

Berk is coaching her clients to focus on engagement at the department and manager levels through annual and quarterly surveys, personal observations and greater interactions with staff.

"Because retention is closely tied to the employees' experience with their manager, we are advising CEOs and executives to have more accountability at the manager level to ensure that team climates are productive and inclusive," Berk said. "Leaders should strive to identify greater/different projects and opportunities for team members. Many organizations are embracing shorter, Web-based quarterly performance evaluations, instead of one long annual one, to formally facilitate direct manager-to-employee communication."

Thompson said that, like many companies, Nintex has moved to a fully virtual model, supporting its team members to be able to work from the safety of their homes, and has largely continued in this model for the past 18 months. Familiar to remote/virtual working already, Nintex pivoted while maintaining productivity and connection to each other through video platforms, intentional team-building activities and facilitating "nonwork" topics to come together on.

"As offices can begin to safely open, Nintex's hybrid-work model allows everyone to work productively, remain connected and drive successful outcomes for the business, regardless of work location," Thompson said.

Nintex monitors engagement, including subcategories such as connection to co-workers, on a weekly basis via pulse surveying.

"Our team members have continued to indicate their engagement, with current company average engagement score of 8.2 (of 10) that has also largely been maintained throughout the past 18 months," she said.

"We have created a results-driven, yet supportive, curious and change-ready environment, with high alignment across functions, geographies and demographic groups."

Mental Health and Burnout Challenges

The pandemic has drastically changed how people live and how companies operate. CHROs are seeing the toll persistent stress has taken on workers. Organizations have ramped up efforts to protect physical health—too often to the neglect of mental health. Long-term neglect of mental health is unsustainable.

• 87 percent of CHROs agreed or strongly agreed that they are comfortable discussing mental health with workers.
• 86 percent of CHROs agreed or strongly agreed that their company has resources to assist employees with mental health issues. 

Andrea J. Miller, SHRM-SCP, CEO of The Digital Patient, a firm that advises for-profit and not-for-profit organizations on strategy, business development and employee engagement, said, "It's clear that COVID-19 isn't going away anytime soon. The uncertainty it has created, and thus, stress and anxiety, make it more difficult for people to manage. So, I'd wonder if employees would agree with the 86 percent of CHROs who say they have adequate mental health coverage."

"Even prior to the pandemic," Miller continued, "about half of the people who reported having mental health issues said they went without care in a fragmented system that can be difficult to navigate, even under the best circumstances."

Miller said that while the CHROs may be comfortable discussing mental health issues, "how well-equipped are their managers to do so within their own teams, especially given that they may also be dealing with their own stressors?"

"Creating a culture of well-being (which encompasses a lot of different areas) is where companies will have to start moving if they want to hire, engage and retain staff. When people don't feel well mentally, physically or emotionally, they're only partially present, and in this current reality, it's only a matter of time before they walk out the door."

Paul Bergeron is a freelance writer.