10 HR Trends You Must Know About To Keep Your Talent Happy in 2022

Aneta Samkoff

From this article, you’ll learn:

  • What HR trends will dominate the current compensation management policies
  • What are the benefits and challenges presented by each
  • How to implement the 2022 HR trends in your company

Current Issues in Compensation Management

No one in the HRM field would underestimate the impact COVID-19 has had on the current workforce market. The pandemic revealed the problems the world economy has been struggling with for a while. In addition, the precarious political and economic situation in the world, exacerbated by Russia’s shocking invasion of Ukraine makes us realize how fragile is the environment we live in, and how quickly and irretrievably it can be changed.

That instability, in turn, affects the whole economy and the workforce market in particular. The shortage of highly-skilled specialists coupled with massive numbers of workers whose abilities will soon become obsolete come to the fore as the most pressing current issues. In addition, the compensation managers have been forced to at the same time balance management costs and protect employees by developing agile and transparent compensation strategies in order to keep their businesses afloat.

As a result, we can identify a couple of compensation trends, several of which like pay equity, pay transparency or variable pay were already on the rise, and their adoption has only been accelerated by recent events. Others, such as remote work or mental health support emerged alongside. Nevertheless, each will help you improve the employee satisfaction and retention.

Here, I will show you how to take advantage of those 10 HR trends, so that you can adopt a compensation strategy that will assure your company’s success in this evolving and complex business environment.


1. Remote Work - Your Remedy For Shortages of Highly Skilled Employees

Research conducted both before and after COVID-19 shows that, on the whole, employees became more productive when working from home rather than the office. That’s not to say that fully remote work is for everyone. Every employee has different needs and priorities, but at least for some groups home office is a desired and expected option. In fact, 42% of current remote workers claimed that if their present company doesn’t continue to offer working from home long-term, they will switch to a company that does, causing high employee turnover.

7 in 10 workers are currently working from home

And there is no shortage of those adopting such policies. For example, Quora, Shopify, Upwork, and Basecamp have already made decisions to transition to a 100% remote work model while Spotify, Slack, and Hubspot chose a hybrid mode with remote work being a major part of how they will operate in the foreseeable future. In fact, in the next three years, as many as 61% of companies could make the home office a permanent policy, according to Willis Towers Watson’s Flexible Work and Rewards Survey.

What are the benefits of remote work? It turns out that employees most frequently cite saving money, no wasted time commuting (and this is the most hated activity of the worker), and more time spent with the family.

Reasons to work from home

Therefore, offering the remote work option may be critical for your company to improve employee retention and keep highly-skilled workers from being snatched by the competition in the current market. Especially, letting your employees go remote may come with some actual perks to your business. These include reduction in real estate and transportation costs as well as alleviating the shortage of skilled labor by tapping into the pool of otherwise unavailable talent all-over the world.

employee expectation of reduction or deacrese in some sectors

The fact that most people choosing to work remotely leave high-cost-of-living areas for more affordable options also opens up a question of location-based compensation, as the cost of living is no longer the same across the entire workforce. Giant companies such as Facebook have already long adopted the policies of pay cuts if their employees choose to work remotely from cheaper locations.

However, think twice before endorsing such policies as highly skilled workers aware of the value of their abilities strongly believe that people doing the same jobs and providing the same performance levels should be paid the same. And many companies are aware of that as well, as 41% of organizations decided to keep the pay the same for both remote and onsite work based on 2022 Compensation Best Practices Report, and 21% chose to transition to location-based pricing. Whether this becomes a more prevalent practice in 2022 remains to be seen.