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HR Outlook 2021: How COVID-19 Will Affect Human Resources in the New Year

CoAdvantage- Undoubtedly, most of us are glad to see 2020 in the rear-view mirror and look forward to 2021 with the hope that this year will see life return to normal as the pandemic recedes. Still, COVID-19 remains with us as we head into the new year and will likely continue to cast a long shadow even after it has waned. In this environment, what should the world of business and human resources expect in 2021?

1: Benefit plans will adapt to the new post-pandemic world.

Some employers may need to adjust their core health offerings out of economic necessity, slimming or streamlining their health plans. Many employers are also considering cost-saving measures like increasing cost-sharing and adding voluntary benefits paid by employees.

Still, the Society for Human Resource Management (SHRM) reports that many companies are also looking at expanding their benefit offerings, including adding virtual and telehealth programs and offering enhanced mental health options through Employee Assistance Programs and other avenues.

2: Analysts offer a cautiously optimistic economic outlook.

Analysts at Goldman Sachs believe the distribution of vaccines for COVID-19 will play a big role in improving the state of the economy. Consequently, they have increased their GDP forecast (to 6.2%) and reduced their unemployment rate forecast (to 6.5%) based on the assumption that consumer spending will accelerate throughout 2021 as people slowly resume normal spending patterns.

3: Employers will place renewed emphasis on skills development.

From an employment standpoint, 2020 and the pandemic sorely tested many businesses’ ability to weather multiple simultaneous crises. However, the ability to manage these issues demands the appropriate skills, and a survey from industry analysts at Gartner found that 71% of learning and development leaders say 40% of their workforce “has needed new skills due to changes to work brought on by COVID-19.”

Indeed, most businesses will spend 2021 feeling out the long-term impacts of COVID-19 and adjusting their practices as needed. As Brian Kropp, a Distinguished Vice President at Gartner, says, “Perhaps most importantly, understanding the future of work is about understanding the permanent workplace shifts post-COVID.”

Many employers will spend the new year assessing how to ensure their companies can survive and thrive in a post-pandemic world.

CoAdvantage, one of the nation’s largest Professional Employer Organizations (PEOs), helps small to mid-sized companies with HR administration, benefits, payroll, and compliance. To learn more about CoAdvantage’s ability to create a strategic HR function in your business that drives business growth potential, contact us today.