State of talent acquisition: 2023

Amid unprecedented workforce challenges, ongoing economic uncertainty and social and political unrest, the Talent Acquisition function is vital to organizations’ success.

Talent Acquisition (TA) and HR leaders are working around the clock to meet growing demands for talent while finding new ways to evolve their technology footprint, invest in skills and build and share an irresistible Employee Value Proposition (EVP) to retain the talent in-hand.

We uncover what Talent Acquisition professionals are doing in the short-term and long-term to mitigate these challenges and more in this year’s Talent Acquisition Study, which had 477 total respondents across 18 industries.

Economic tensions in the market are shaping organizational talent needs

Due to the unique market conditions of 2023, organizations are re-framing their internal labor markets based on workforce skills. A skills framework aligns Talent Management (TM) and TA teams to engage critical talent and drive business results.

54% of organizations have invested in a skills framework to support both TA and TM

Talent Acquisitions’ challenge is to:

Diversify talent

Increase diversity of talent pools (43% of respondents)
Mitigate the gap

Mitigate the gap between the skills organizations need and the ones job hunters have (65% of respondents)

Skilled employees are hard to find across all industries, and while for some (Healthcare providers and Manufacturing) the level of hiring has increased in 2023, for others (Financial Services and High-tech) have decreased.

TA strategy aligned with overall business strategy

More than half of participants indicated that their Senior Leadership in US places a high priority on aligning their Talent Acquisition strategy with the overall business strategy.

Advanced technology adoption dilemma and the use (or not) of AI

The penetration of advanced technologies deep into various business processes — like candidate sourcing and screening, skill identification and assessment, predictive data analytic / workforce planning, candidate experience end-to-end assistance — is evident among future (forward) oriented organizations.

Over the last year, would you say investment in technologies within your Talent Acquisition processes has:

50% of organizations in 2023 maintain the same level of TA technology investment as prior years, which is an indicator of the commitment made to be a part of the evolution.

Accelerated tech adoption has continued with mixed results:

Nearly 38%

of participants use AI to source and engage potential talent to enhance the pipeline (employer-centric approach).
Only 26%

use AI to help candidates find the right position (candidate-centric approach).

TA Operations — settling into new normal

A more stable TA operating model brings a new understanding of the resources needed to be a high performing function.

2023 is the year of equilibrium for many organizations from a talent needs perspective giving an opportunity for the Talent Acquisition function to finally catch up after several years of frantic pace of recruiting.

61% of organizations indicate that they were able to meet 80-100% of their hiring targets for 2022.

Overall, non-profits, NGOs (non-governmental organizations) and academic institutions are less likely to hit the higher percentages of their hiring targets compared to for-profits

This is also reflected in the fact that 66% of participating organizations expect their recruiting teams to remain the same size, so no additional internal hires or layoffs. This suggests that the staffing ratio is at the right level to handle the demand for talent for those organizations.

Another aspect driving the equilibrium is the level of US resignations in 2023, which is back at the pre-pandemic figures of 2019 according to the BLS. Organizations are doing better at retaining their newly hired employees, which provides an opportunity for TA to refocus its mindset from survival to efficiency.

State of talent acquisition: 2023

Amid unprecedented workforce challenges, ongoing economic uncertainty and social and political unrest, the Talent Acquisition function is vital to organizations’ success.

Economic tensions in the market are shaping organizational talent needs

Talent Acquisitions’ challenge is to:

Diversify talent

Mitigate the gap

Skilled employees are hard to find across all industries, and while for some (Healthcare providers and Manufacturing) the level of hiring has increased in 2023, for others (Financial Services and High-tech) have decreased.

TA strategy aligned with overall business strategy

Advanced technology adoption dilemma and the use (or not) of AI

Over the last year, would you say investment in technologies within your Talent Acquisition processes has:

50% of organizations in 2023 maintain the same level of TA technology investment as prior years, which is an indicator of the commitment made to be a part of the evolution.

Nearly 38%

Only 26%

TA Operations — settling into new normal

This is also reflected in the fact that 66% of participating organizations expect their recruiting teams to remain the same size, so no additional internal hires or layoffs. This suggests that the staffing ratio is at the right level to handle the demand for talent for those organizations.

2023 State of Talent Acquisition Study

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