🎲 AI is revolutionizing HR and reducing costs, but does it enable organizations to focus on more "human" work?

AI data and trends for business leaders: #2024-13 | AI systems series

AI has the potential to bring in a new era of human resource (HR) management, one in which automation, machine learning, and data analytics all work together to deliver higher-quality outcomes while saving time for employees. Not only can time be saved, but near real-time information, insights, and recommendations can also be given. And that's only the introduction of AI to HR.

The key benefits of AI in HR:

• Enhanced efficiency and productivity: AI can automate repetitive and time-consuming tasks such as resume screening, scheduling interviews, and onboarding new hires. This frees up HR professionals to focus on more strategic initiatives.

• Improved decision-making: AI can analyze vast amounts of data to identify patterns and trends that would be difficult for humans to see. This data-driven approach can help HR leaders make better decisions about talent acquisition, performance management, and employee engagement.

• Reduced bias: AI can help to mitigate unconscious bias in the hiring process by objectively evaluating candidates based on skills and experience.

• Personalized employee experiences: AI can be used to personalize the employee experience by providing targeted training and development opportunities, as well as ongoing feedback and recognition.

• Predictive analytics: AI can be used to predict employee turnover, identify potential skills gaps, and forecast future talent needs. This allows HR to be more proactive in managing their workforce.

• 24/7 Support: AI-powered chatbots can provide employees with 24/7 access to information and support on HR-related topics.

The important questions to ask:

▸ What can your organization measure for the success of your HR?

▸ How, by integrating AI, can organizations balance costs, creativity, and culture?

▸ Why should your organization (care and) monitor for potential biases in AI outputs to ensure fairness and ethical use?

↓↓↓ Some facts below ↓↓↓

---

The landscape

As AI technology advances beyond automation to augmentation, businesses could be considering how AI tools can improve the work that HR does for both candidates and current workers.

📌 Fact 1: HR leaders using AI

• Breakdown by company size: Include a stat that shows how AI adoption might differ based on company size. For example, a study by Paychex found that over 75% of HR leaders at companies with more than 20 employees plan to use AI within a year, compared to just over half (51%) at companies with 5-19 employees¹. This highlights the potential for a wider adoption rate as smaller businesses gain access to AI solutions.

• Focus on specific AI applications: Expand on the types of AI being used by mentioning popular applications. A report by Gartner found that the top 3 HR applications of AI are²:

  1. Candidate screening

  2. Chatbots for HR inquiries

  3. Skills gap analysis [Source: Gartner]
     This showcases specific ways HR departments are leveraging AI technology.

• Comparison to traditional methods: Highlight the contrast between AI and traditional methods by adding a stat on the limitations of current practices. For instance, a study by the Society for Human Resource Management (SHRM) found that the average time-to-hire in the US is 42 days [Source: SHRM from 2017³]. By combining this with the McKinsey stat about AI reducing time-to-hire by 70%, you emphasize the potential for significant improvement⁴.

📌 Fact 2: businesses believing AI will revolutionize HR

• Increased adoption rates: We can add a stat that shows a growing trend in AI adoption for HR. For example, a report by Gartner found that by 2026, 75% of HR organizations will be leveraging AI for talent acquisition⁵. This emphasizes the momentum behind AI in HR.

• Focus on specific HR functions: We can mention specific HR areas where businesses see the most potential for AI. A study by PwC found that 72% of executives believe AI will have the greatest impact on recruiting, followed by learning and development (63%) ⁶. This highlights where businesses anticipate the most significant changes.

• Global recognition: We can broaden the perspective by including a stat about international recognition of AI's impact on HR. The World Economic Forum's Future of Jobs Report 2020 predicts that by 2025, AI will create 97 million new jobs while displacing 85 million⁷. This positions AI as a transformative force in the global workforce.

📌 Fact 3: AI-powered recruitment reducing time-to-hire

• Reduced time-to-hire and cost-per-hire: We can combine the McKinsey stat with another one on cost savings. According to a Bersin by Deloitte study, AI reduces cost per hire by an average of 27%⁸. This paints a more complete picture of the efficiency gains from AI recruitment.

• Impact on specific tasks: We can delve deeper by mentioning how AI tackles specific time-consuming tasks. For example, AI can screen resumes up to 70% faster than humans, according to Pulser Recruitment⁹. This highlights a specific bottleneck that AI can address.

• Improved candidate experience: We can add a stat that shows how faster hiring benefits candidates as well. For instance, a study by Indeed found that 60% of job seekers consider a company's application process when deciding whether to apply for a job. Highlighting how AI can lead to a quicker application process showcases a benefit for both businesses and candidates.

---

Takeaway

These conversations are happening as the workforce undergoes significant change. According to a global study from the IBM Institute for Business Value (IBV)¹⁰, surveyed executives estimate that 40% of their workforce will need to reskill due to implementing AI and automation over the next three years.

This shift is viewed as an expansion of job possibilities. 87% of respondents believe employee roles are more likely to be augmented than replaced by generative AI, with the effects varying depending on job function.

This transition will directly impact HR departments as companies look to fill roles that perform augmented tasks, and workers seek new jobs as their functions change. AI adoption into HR technology has the potential to assist HR teams in this new landscape. Emerging AI tools are rapidly advancing past efficiency and becoming tools for innovation—something that frees team members to think about HR more strategically while still providing a human touch.

---

Resources

The future of work: AI-proofing your career by Matthew Wells

---

Continue exploring

---

🎲 Data and trends

This email is sent to you because you signed up for Wild Intelligence by Yael Rozencwajg. Thank you for your interest in our newsletter!
Data and trends are part of Wild Intelligence, as well as its approaches and strategies.
We share tips to help you lead, launch, and grow your sustainable enterprise.

Become a premium member, and get our tools to start building your AI-based enterprise.

1. Over 75% of hr leaders will use ai in the next year, according to new Paychex research

2. Gartner identifies three most common ai use cases in hr and recruiting

3. Employers invest heavily hiring foreign talent

4. The economic potential of generative AI: The next productivity frontier

5. AI in HR: the ultimate guide to implementing ai in your HR organization

6. Why you need to turn your organization’s attention to AI

7. The future of jobs report 2023

8. According to a Bersin by Deloitte study, AI reduces cost per hire by an average of 27%

9. The future of hiring: how ai is changing recruitment

10. New IBM study reveals how AI is changing work and what HR leaders should do about it