Data security, health and safety shoot to top of HR concerns

Workplace health and safety along with employee data security have become top priorities for businesses, according to a survey by a human resources software specialist, although recruitment remains the biggest challenge.

The survey found more optimism for 2023 with three out of four businesses planning to recruit – up from 50 per cent last year and the highest figure since the Elmo survey of HR professionals began in 2019.

However, the process has become costly with 45 per cent of businesses targeting their biggest budget increase towards recruitment compared with last year, when pay and benefits got the largest rise.

The survey showed on average each recruit costs $8,000 to find and vacant roles take 20 days to fill. While companies have begun prioritising quality candidates over the pandemic rush to simply hire, retaining staff remains an issue with average employee turnover at 15 per cent – seven in 100 – a year.

Among new hires the average figure is 13 per cent, a huge leap on the pre-pandemic rate, and even worse in education, and manufacturing and utilities.

Elmo CEO and co-founder Danny Lessem said a “bums on seats mentality” over the past few years was shifting in favour of high-quality recruits who were a good fit for their roles.

“HR is now telling us that finding the right candidates is their biggest recruitment challenge and that suggests the focus has shifted from quantity to quality,” he said.

Almost one-third of HR specialists said finding the right candidates was their company’s key recruitment challenge, displacing the skills shortage and competition for talent which tied for first place last year.

Mr Lessem said hiring good quality candidates was simply a sound approach to business.

“Given potential budget constraints this year and the need for high productivity as the economy slows, it makes commercial sense to hire well rather than waste money churning through new staff,” he said.

“We anticipate that hiring throughout the rest of the year will be much more deliberate.”

Employee wellbeing was another issue highlighted during the pandemic remains a top-three priority with a shift away from reactive measures towards preventative initiatives, the survey found.

“While employee assistance programs are a valuable tool, they tend to be utilised later down the line once an employee needs urgent support,” the survey said. “The rise of mental health days, wellbeing apps, volunteering days, and subsidies for mental and physical health all point to organisations taking conscious steps to prevent poor wellbeing.

“What was surprising is that almost a quarter of HR professionals said their organisation offers unlimited leave, an initiative that would’ve been a rarity in the past.”

The number of organisations offering mental health days/programs had risen from 24 per cent in 2021 to 43 per cent this year, while the number offering no initiatives had fallen from 11 per cent to 5 per cent.

However, staff wellness was nudged off top spot by a 15 percentage point increase in the concern attached to workplace health and safety, with more than nine out of 10 respondents giving it medium or high priority.

The research said this could be a state-based effect, with “a tightening of the workplace health and safety in NSW last year, which now include requirements for employers to identify and reduce psychosocial risks, as well as harsher penalties”.

Another trend involved decreased flexibility over office attendance, with a big decline in businesses allowing staff to work three or more days a week from home, “underlining the sense that most business leaders would prefer employees in the office for most of the working week”.

Elmo found finance was the most lenient when it came to working from home, with eight out of 10 saying it offered work from home for up to four days a week or sporadically.

Data security was also ranked medium or high priority by more than nine out of 10 respondents following the high-profile cyber attacks last year on Optus on Medibank. Among finance businesses surveyed, 50 per cent rated employee data security as a high priority while retail, catering and leisure was most concerned with almost two-thirds ranking it top.

Elmo Software security expert Keith Marlow said staff trusted businesses with their data but that should not be taken for granted.

“Securing the personal information of employees is a critical concern for businesses,” he said. “That’s why it is imperative for HR leaders to develop policies and processes that safeguard their employee data, as well as thoroughly vetting the external vendors they work with.”

Elmo said the use of spreadsheets to store staff information had declined in each of the last four years of the study and was down almost 40 per cent over 2019. However, they remained the top choice of HR managers to manage employee data with one-third attached to the method “despite the significant risk of data integrity being compromised”.

Mr Lessem said it was alarming that such an outdated method was still a top choice.

 “The use of manual methods, such as spreadsheets, to manage employee data is not only risky but inefficient,” he said.

“With the increasing threat of data breaches and cyber attacks, HR professionals need to prioritise data security and adopt modern HR software solutions that provide advanced security features and data encryption capabilities.”

Now in its fourth year, the HR Industry Benchmark Report is based on a survey of 700 Australian human resources professionals. It is the largest survey of its kind in Australia and a joint initiative between Elmo Software and the Australia Human Resources Institute.