20.12.2023

HR Tech-2023: Trends and Perspectives

In today's world, where technology plays an increasingly important role in business, human resource management is not left behind either. With the development of new technologies, new tools for improving recruitment also appear. Essentially this is HR Tech (short for Human Resources Technology). In the last 5 years, the HR Tech market has experienced rapid growth. During this period, according to experts, about 40% of all IT-products used by companies have been created.

On the one hand, the average company uses about 80 technological products in HR simultaneously, which shows that the market lacks complex solutions. On the other hand, we have a lot of product alternatives for one HR process and a complete lack of them for another.

After rapid growth, investor interest in the HR Tech market is waning. Startups do not become profitable in the moment, and companies that implement such solutions do not say that their productivity has significantly increased. There is a definite outflow of interest in this. Global satisfaction with large platforms is also dropping.

At the moment, most experts agree on which technologies will obviously attract investments and and which innovations seemed revolutionary, but the prospects of their application for HR management are not yet visible.

With the rapidly changing technology landscape and the need to improve the digital employee experience, 47% of HR executives plan to increase their investments in HR technology, according to Gartner research.

The following technologies will be in the growth zone in the near future:

generative AI;
HR hyper-automation (AI, ML, RPA, SaaS, etc.);
AI in skills management;
talent marketplace.

According to a Gartner survey, the top 3 most important technologies for businesses include:

skills management (51%);
LXP platforms (41%);
internal talent marketplace (32%).

At the same time, innovations in the field of meta-universes, blockchain, and distributed computing clearly failed. The market of training using virtual reality devices is generally promising, but there are few successful examples.

In general, we can say that HR Tech is an essential tool for modern companies that want to be successful in the labor market. With the development of technology in this area, we can expect even more interest from employers. The main goal is to change the workload on HR as GenAI is implemented, namely, to increase the share of strategically significant functions in relation to current tactical operations that can be automated.

#Hr