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What keeps HR awake at night?


According to a new Workplace Forecast survey by the Society for Human Resource Management (SHRM), HR professionals’ most pressing challenges are rising health care costs, implementing the new health care reforms, rapidly changing business and labor markets, growing regulatory complexity and managing the aging workforce.

Here are the 10 toughest HR challenges, according to the 9,000 HR practitioners SHRM polled to prepare the forecast.

Figures in parentheses indicate the percentage of survey respondents indicating that an issue is having a “major strategic impact” on their organizations.

1. Continuing high cost of employee health care coverage (85%): According to SHRM, “Economic and employment issues have been at the forefront of HR professionals’ concerns since the 2007-2009 global recession began in December 2007.” The high cost of providing employee health insurance took center stage in 2010.

Reason: Last year, employers typically paid $8,026 in health care costs for each employee enrolled in an employer-sponsored health care plan.

2. Passage of federal health care legislation (82%): HR pros are focused on determining what their organizations must do to comply with the Affordable Care Act health-care reform law and figuring its current and future cost implications. More than half of respondents report that senior management has asked for HR’s input on how to respond to health care reform.

Editor’s Note: Health care costs and compliance issues top the list of HR worries. Get the experts’ answers to frequently asked questions from The HR Specialist‘s podcast on Health Care Reform Compliance Workshop. (And earn 1.25 credit hours toward PHR and SPHR recertification through the Human Resource Certification Institute)…Get up to speed now on new mandates … new responsibilities … new tax issues – and new penalties!

3. Increased global competition for jobs, markets and talent (72%): The rise of the 24/7, global economy is driving business change in the U.S. That raises the stakes for HR to attract and retain the best employees.

4. Growing complexity of legal compliance for employers (72%): Proposed legislation limiting the use of background and credit checks in hiring has HR pros worried, as do U.S. Citizenship and Immigration Services steps to tighten up visa requirements for immigrant workers. Also a concern: State wage-and-hour legislation that could be harder to comply with than the federal Fair Labor Standards Act.

5. Changes in employee rights due to legislation and/or court rulings (67%): HR professionals find they must monitor both legislative initiatives and recent court decisions to make sure their organizations continue to comply with the law and avoid costly litigation.

6. Large numbers of baby boomers leaving the workforce at around the same time (64%): As baby boom workers—those born between 1946 and 1964—begin retiring en mass, HR practitioners worry about replacing their expertise and speeding up career transitions for younger workers. Also on the radar screen: Providing benefits that suit older workers who aren’t yet ready (or financially able) to retire.

7. Economic growth of emerging markets such as India, China and Brazil (63%): As these once-emerging markets go mainstream—the recession was far kinder to them than it was to the U.S. and Europe—more and more organizations are setting up shop hemispheres away. Many are having to deal with the intricacies of running a multinational business for the first time.

8. Greater need for cross-cultural understanding/savvy in business settings (61%):  The pressure is on HR to develop internationally skilled employees and lead organization development initiatives that prepare employers to capitalize on global opportunities.

9. Growing national budget deficit (61%): Many of the measures Congress is considering to reduce the federal deficit could affect HR. For example, proposals are afoot to tax compensation such as health care and retirement benefits and extend the age of eligibility for Social Security.

10. Greater economic uncertainty and market volatility (61%): Many of the eight million jobs employers shed during the recession are never coming back. Plus, continuing economic uncertainty has put hiring on hold for many employers.

That means HR sits in that old, familiar place: Figuring out how to get more done with fewer people to do it.

Read the full SHRM report here.