Have demographic shifts made recruiting with AI increasingly relevant? Are you biting your nails waiting for it to feel like the right time for AI? The wait is over because the right time for AI is now. If you’re not sure where to start, we’ve got some tips that can help.
How Do the Big Dogs View HCM Anyway?
Compliance has long been one of the main reasons that people with purchase-making ability inside companies (i.e. VPs, executives) buy human capital management software, or HCM. The value propositions by the HCM companies are often around “engagement” and “experience,” and while executives do broadly care about those concepts, compliance tends to be the most important feature in software that will mostly be used by the Human Resources department.
This has been the case for years, but we’re increasingly into the age of even more strategic value from HCM solutions.
Some of the Big Things All Happening at Once…
The Baby Boomer exodus: You’ll see different numbers on this, but broadly about 10,000 Baby Boomers are retiring daily right now. (More, and more recently, here.) This is hitting some industries harder than others (insurance, etc.) but almost regardless of vertical, that’s a tremendous amount of knowledge evaporation and sheer lack of bodies for the roles.
Declining labor force: Right now the market is hot and we can’t stop talking about that, but long-term the picture isn’t as rosy. There’s actually an aging population and a declining birthrate among native-born citizens in the United States. Admittedly this hits certain areas harder than others, such as Vermont, where Governor Phil Scott said this in his January 2019 budget address:
“This makes it incredibly difficult for businesses to recruit new employees and expand, harder for communities to grow and leaves fewer of us to cover the cost of state government.”
Put aside the politics and focus on the first part. “Incredibly difficult for businesses to recruit and expand.” This isn’t a small problem, either: 80 percent of American counties, with a total population of 149 million people, saw a decline in prime working-age adults between 2007 and 2017. At the same time, the U.S. fertility rate hit its second consecutive all-time low in early 2019.
Add those two up and now you’ve got: A generation that helped define modern work is leaving, the remaining generations may not be getting their knowledge (The New York Times spilled the tea on Gen X recently and deemed them “a mess”) and the overall available employee pipeline is drying up faster than we realize.
This is AI’s Moment
How many times in the last 15 years have you heard someone say that HR needs “a seat at the table?” It realistically is not going to happen under the current set-up. HR usually doesn’t have a profit and loss statement because it doesn’t directly generate revenue, and, as noted above, in many places it’s still viewed primarily as a compliance function.
But now we’re into some heady issues. The very ability of businesses to grow could be at stake.
This is a moment for HCM to step up and offer consolidated offerings around sourcing, screening, candidate rediscovery, onboarding, knowledge transfer, and more. This is a time for AI do some of the driving so that recruiters can find their value-add even in a potentially stressful, high-volume hiring context.
We’re into the period already where HCM software is being valued above simply compliance, and the broader economy will continue to reflect that.
The bridge to a more autonomous economy — and everything that means — could be a chaotic time for first-world businesses. Is HCM going to help them through it, or hinder their progress? If you invest in the right technology, aimed at saving time and money, you can be more effective even with all these demographic shifts we’re starting to see.
The Good News — It is Time for AI
There are a lot — A LOT! — of smart people out in this space working on these problems. There are thousands of you building the future of work and preparing to tackle some of the above (and more!) head on. It’s a glorious time to be in the space in that regard.
A lot is about to change in our employment landscape, and AI has a huge opportunity there. We’re so glad to be a part of this curve right now, helping recruiters to be more efficient and businesses to prepare for their futures more strategically.
The original version of this article was first published on iIdeal.