Human Resources

Human Resources

Industry Outlook

According to the U.S. Department of Labor, employment of human resources specialists is expected grow 5 percent through 2028, as fast as the average for all occupations. Training and development specialists will experience a 9 percent increase (faster than the average) during the same timeframe. The rising use of temporary workers and increasingly complex employment laws will create most of the demand. Specific standards for occupational safety and health, equal employment opportunity, wages, and benefits make it necessary for many companies to have human resources experts handling their personnel issues in order to avoid errors and omissions. Of particular significance are rising health care costs, how implementation of the federal Affordable Care Act will affect businesses, and the structural changes that have taken place in many companies' insurance packages. As benefits programs become more complex, human resources professionals who are familiar with program requirements and options become more valuable. For the same reasons, human resources managers can expect growth of 7 percent (faster than the average) through 2028.

Following the 2008 recession, it became evident that many workers nearing retirement were unprepared financially. Human resources professionals are expected to play an increasing role in helping workers plan for retirement, according to the Society for Human Resource Management (SHRM). The top three challenges for human resources specialists in the coming decade, according to the SHRM, will be retaining and rewarding the best employees, developing future corporate leaders, and creating corporate cultures that will attract the best employees.

Labor relations specialists will experience a decline of 8 percent through 2028 as a result of shrinking labor unions. However, the hiring of labor relations staff and arbitrators may benefit from companies' focus on resolving labor disputes on their own rather than in court. There may also be an increased demand for specialists in international human resources management and human resources information systems.

Employment growth may be especially strong in companies that recruit, manage, and supply personnel to other companies. An increasing number of businesses are opting to contract out for personnel management or hire personnel specialists on a temporary basis. Demand should also be especially strong in companies that specialize in developing and administering employee benefits packages for other companies.

The human resources job market is expected to be favorable in the coming years for specialists, though competition will be strong for management positions. Job growth may also be somewhat limited by the increasing use of computers in various aspects of human resources management. According to the HR Trend Institute, there are several new trends to look for in the coming years. These include the impact of artificial intelligence (AI) and technology; a new talent landscape that emphasizes inclusive environments and diverse teams; the importance of an organization's purpose and meaning; the pace of change; morality, ethics, and transparency; and globalization.

Employment in human resources, as in other areas, may be slowed in some cases by corporate downsizing and restructuring and the use of computerized human resources information systems that allow workers to accomplish more tasks in a shorter period of time. Technology even has influenced the activities of recruiters, as some companies take this process online instead of sending staff to job fairs and college campuses.

The human resources industry experienced a decline in 2020 due to the coronavirus pandemic, which caused a global economic shutdown. The federal government enacted economic stimulus plans, including the Coronavirus Aid, Relief, and Economic Security (CARES) Act and the Paycheck Protection Program (PPP), which have helped provide support to U.S. businesses. As of August 2020, the human resources and benefits administration industry in the U.S. was valued at $58 billion, consisting of 322,897 businesses and a total of 777,008 employees, according to the research group IBISWorld. The group forecasts that the industry will rebound in the coming years. The COVID-19 vaccine rollout in 2021 and subsequent strengthening of the economy will encourage growth in this industry. In addition, more companies will seek out human resources services due to increasing compliance costs and structural shifts in human resources management. "In particular, small businesses with limited resources that aim to focus on core operations are expected to continue outsourcing administrative duties, such as retirement and health benefits management, to industry operators." Midsize businesses that have "limited understanding of complex labor laws" will also outsource regulatory tasks to human resources and benefits administration providers.