HR Trends: Fad or Forever?


My dictionary defines ‘fad‘ as a temporary fashion, manner, or conduct followed enthusiastically by a group. My life experience tells me that fads come and go—and some fads come back. Not convinced? Remember skinny-leg jeans? They’re back. Actually, they’ve been back for quite a while. Some would say they never went out of fashion but were just temporarily interrupted by bell-bottoms. If that’s the case; does that make them a standard?

What about other standards?

Let’s get right to it. I’m talking about standard practices in HR and compensation. You know, things like base pay, the 40-hour workweek, pensions, lunch breaks—the list goes on and on.

At my day job, one of my responsibilities for the last few years has been to conduct surveys about everything from benefits to HR departments to training so, at the end of 2015, I took a look at how the survey data has changed over the years and noticed a few surprises. For example, the practice of offering defined benefit plans (a.k.a., pensions) is on the upswing.

The prevalence of defined benefit plans began its decline a couple of decades ago, as defined contribution plans (think 401(k)) became more popular with employers. Not surprising, given defined contribution plans are a lot more affordable for employers than traditional pension plans. If you’d asked me, even a few months ago, if pensions would ever make a comeback, I’d have said something like, “yeah, when the price of gasoline drops under $2 a gallon.” Silly me.

What else is making a comeback or fading away?

If you’d like to learn more about recent trends in HR and compensation, check out the 2015 Year in Review and 2012-2015 Data Trends report at Compensation.BLR.com.

Um, the thing is, you might not be able to view the full report. So, for those without access, below are a few highlights.

Percent_Offering_401kThough there was a slight bump in  percent of organizations offering 401(k) plans in 2014 (87%), compared to 2013 (86%), a dip in 2015 (81%) places that benefit on a downward trend and, if it continues, only about three-fourths of employers will be offering the benefit by 2018.

Health_Savings_AccountsIn 2013, 62% of employers offered health savings accounts as a benefit and 34% did not. In 2014, the numbers moved closer together and, in 2015, the practice of offering health savings accounts came to a crossroads, with the percent of employers that offer them, as well as the percent that do not, both at 49%. If the trend continues for the next three years, the “haves” and “have-nots” will switch places, with 70% offering the benefit by 2018.

PerquisitesThe popularity of “nice-to-haves” like wellness programs and tuition reimbursement is declining and is projected to continue falling.

Though performance management software is slowly gaining more widespread use, still less than a quarter Performance_Appraisal_Softwareof survey participants utilize this tool.

Management’s tendency to view HR as primarily an administrative function is on the decline while, at the same time, viewing HR as a strategic business partner is becoming more commonplace. Management_View_of_HRBoth views crossed paths in 2015 and are expected to reach a tipping point—when a higher percent view HR as strategic than administrative—in 2016.

Interesting stuff!

And, there’s a lot more data available. If you’d like to view the entire report, go to Compensation.BLR.com.

Now, back to my day job!

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