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CHRO and human capital leaders

Latest findings from PwC’s Pulse Survey

CHROs bet on inclusion to retain talent and launch hybrid work

As work shifts into a new chapter, CHROs are facing two critical challenges at once: retaining employees and leading the charge on making hybrid work a success. First, there’s the great “employee exodus,” with two-thirds (65%) of employees saying they’re looking for a new job —  up from 36% in our workforce survey in May. With a tight labor market and 10.1 million open jobs in the US, this raises a significant challenge for HR leaders in terms of both recruiting and retention. Second, there’s the new world of hybrid work, where HR is at the forefront on everything from managing rotating schedules to mitigating the risk of remote work inequity —  the idea that those who work remotely will end up being passed over for promotions or stretch assignments in favor of on-site employees. 

CHROs see inclusion and inclusive leadership as key to addressing both challenges: Create a work environment where people feel valued and can be themselves, with leaders who are empathetic and provide equal opportunities and resources to everyone, and they’re less likely to want to leave. More than a third of CHROs (36%) identify building inclusive leadership in a hybrid workplace as one of their top three priorities for the next three months. Long-term (12 months and out), they also see leadership development (34%) and establishing a hybrid work model (32%) as their top focus areas. 

Focusing on the employee experience is key to both retention and to navigating the new world of hybrid work. Strong leadership skills are critical to retaining and engaging talent; leaders shape the vision for their team, coach employees, influence well-being and support the redesign of work, all of which contribute to overall employee experience. Yet many leaders have little experience in managing a hybrid workplace and have yet to establish protocols and best practices for how to lead in a hybrid world. Many will need personalized coaching and training on how to do it successfully, inclusively and with empathy.  

Meanwhile, even if only a fraction of the employees who say they’re looking actually leave your company, you’ll still have a significant percentage of people who are unhappy enough to want to leave. There will also be others who may not be looking but are likely to be approached by recruiters seeking to lure talent away with the promise of higher compensation, work-from-anywhere options and other perks. Look to adopt a strategy of “re-recruiting”: proactively make a compelling internal offer to your top current employees to entice them to stay, rather than waiting for them to get an offer elsewhere and have to compete. 

Use employee listening tools, preference analytics and sentiment surveys to better understand employees’ needs and identify flight risks early on. Wherever possible, take a personalized approach to designing the right compensation and benefits to motivate them to stay, and consider offering development opportunities that help them grow. Finally, work to strengthen and reinforce the employee value proposition as a way to attract and retain talent.

Building leadership in a hybrid world tops CHROs agenda

Leadership development
%
Establishing a successful hybrid work model
%
Career development and progression
%
Employee mental health and well-being
%
Redefining our culture in a world of hybrid work
%
Revisiting overall workforce strategy
%
Reimaging performance management
%
Progression against diversity and inclusion goals
%
Succession planning
%
Reimagining recruitment
%
Reimagining rewards
%

Q: What are your biggest priorities around the future of work/workforce long term (more than 12 months out)? (Select up to three.)
Source: PwC US Pulse Survey, August 19, 2021: CHRO base of 100

CHROs zero in on getting employees vaccinated 

With health officials and employers alike seeing COVID-19 vaccinations as critical to fully reopening the economy, CHROs are ready to help persuade the unvaccinated to get their shots. Nearly a third (29%) of HR leaders identified encouraging employees to get vaccinated against the virus as a top priority for the next three to six months. 

While a growing number of large businesses are mandating vaccines, others are hoping they’ll be able to stop short of a mandate if they can entice their workforce to get the vaccine by choice. Increasingly, employers are offering incentives such as paid time off or spot bonuses to encourage vaccinations. Some are also hosting COVID-19 vaccine clinics on-site for their workforce — a measure that 77% of employees told us in March that they’d be willing to participate in. With the rise of delta and other variants, this may go far in increasing safety and alleviating worker concerns about missing work for vaccination appointments or illness.

Regardless of whether companies mandate vaccinations or opt for encouragement, CHROs will need to be prepared with policies and responses related to vaccine status. For example, if your company implements a mandate, how will you accommodate employees who cannot be vaccinated for medical reasons and therefore cannot work on-site? How will you create an inclusive environment and address the risk of bias if people who do not get vaccinated cannot return on-site? Involuntary or voluntary employee attrition also may be a consideration, as employees in some areas say vaccine mandates would cause them to leave.

Given the politicization and divisiveness of vaccines and masks in the workplace, HR can lead by being inclusive and working to manage discord. For example, 41% of HR leaders said in November that they were already working to create opportunities for employees to have conversations about difficult social issues; the topic of vaccines may be something employees also want to explore with others, and HR can help enable those discussions. 

CHROs should also be prepared for potential secondary impacts of delta or other variants, such as employees who may have to miss work to take care of sick children or family members or those who will need to work from home because their child’s school or daycare has closed due to rising cases.

CHROs ready to encourage workforce vaccinations

Retaining employees
%
Building inclusive leadership in a hybrid workplace
%
Addressing employee mental health, well-being and burnout
%
Improving technology options to enable hybrid work
%
Encouraging employees to get vaccinated against the virus that causes COVID-19
%
Hiring and onboarding
%
Addressing physical safety on-site
%
Upskilling/reskilling
%
Redesigning how work gets done (process optimization, automation)
%
Planning for policy changes related to immigrations
%
Other
%

Q: What are your top workforce priorities over the next 3 to 6 months? (Select up to three.)
Source: PwC US Pulse Survey, August 19, 2021: CHRO base of 100

Employee challenges are becoming more expensive — but HR budgets aren’t budging

Long before COVID-19 came along, HR leaders routinely struggled to secure the budget they needed to execute on their HR agendas. So it’s not unexpected that CHROs still identify two budget-related issues as the top challenges they face now in terms of achieving their future of work priorities. More than a third (37%) said the budget investment for HR functions is a major challenge, while 33% said the same about enabling human resources systems and tools (an effort that typically requires a healthy budget). 

However, COVID-19 has added a multitude of new responsibilities to HR’s plate, including designing remote and hybrid work, managing employee safety and well-being, and creating an inclusive work environment. Investors are also increasingly expecting companies to step up on people-related issues such as diversity and inclusion. With so many workforce challenges to manage, many HR budgets are straining to keep up.

Meanwhile, more than a quarter of CHROs also cited the challenge of not being able to customize their HR programs and policies to meet changes in business needs and workforce preferences. Given the complexities of the changing work environment, the need to be able to personalize HR policies and programs is likely to become more pressing. For example, some companies are finding that one-size-fits-all hybrid work policies, such as requiring certain teams or individuals to be in the office on specific days a week, can backfire by reducing the flexibility that employees prize.  

Given the elevated role and importance of the people agenda, many businesses need higher-end strategic HR capabilities and investments. You can make the business case by showing how HR challenges are also business problems. For example, immersive and inclusive leadership training often falls under the category of discretionary spending. But creating an inclusive environment is essential to retaining and attracting talented employees — and those employees are critical to helping the business achieve its revenue and growth goals.

Budget woes challenge the HR agenda


Not a challenge at all
Minor challenge
Moderate challenge
Major challenge

Investment budget for HR function
%
%
%
%
Enabling human resources systems/tools
%
%
%
%
Human resources organization structure
%
%
%
%
Quality and availability of credible workforce/people data
%
%
%
%
Overemphasis on short-term HR priorities
%
%
%
%
Human resources talent
%
%
%
%
Alignment of business and HR priorities
%
%
%
%
An inability to customize our current HR programs and policies to meet changes in business needs and workforce preferences
%
%
%
%

Q: How much of a challenge are the following for the HR department to address the business’s future of work priorities?
Source: PwC US Pulse Survey, August 19, 2021: CHRO base of 100

About the survey

Our latest PwC US Pulse Survey, fielded August 2 to August 6, 2021, surveyed 100 human resource leaders from Fortune 1000 and private companies, along with other C-suite executives, about business priorities and decisions they’re making around the future of work. Find all of these insights in our PwC US Pulse Survey.

Contact us

Bhushan Sethi

Bhushan Sethi

People & Organization Joint Global Leader, PwC US

Julia Lamm

Julia Lamm

Principal, Global Workforce Strategy Leader, PwC US

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