Balancing benefits, tech risks, and talent in a tight labor market

Increasing health and benefit costs are the most likely factors to negatively impact employees, but ineffective leadership poses the most severe threat. At least that’s what the HR and risk professionals surveyed in Mercer’s latest United States People Risk study think. The report, which draws from a survey of 509 HR workers and 515 risk management professionals, gives important insights into the risks facing American workers and companies right now, and offers an array of potential solutions.

As one might expect, the study shows that HR and Risk professionals have different views of the challenges facing workers. Generally, risk professionals are more concerned with technological risks like cybersecurity and artificial intelligence, while HR workers tend to focus more on governance challenges and talent strategies. Looking three to five years out, HR respondents rated environmental challenges as being the most impactful, while risk specialists still ranked technological risks as the most severe.

Despite differences between the two fields, the report shows that risk specialists and HR are collaborating a fair deal. Ninety-seven percent of respondents said that there was some or a great deal of collaboration across functions, with 50% reporting a great deal of collaboration. Notably, however, 61% of respondents at organizations with more than 5,000 employees indicated that there was a great deal of collaboration. That number is much lower at smaller organizations: Just 30% of respondents working at companies of 500 or fewer people said there was significant collaboration.

Across both groups, 44% of respondents said they were concerned about the increased risk of cyber-attacks due to lack of cybersecurity awareness, organizational design and/or culture. Further, 36% reported concern with employees’ over-reliance and complete trust in AI-generated content without proper verification. The report’s authors stress that it’s important for organizations to win with the new technologies all while mitigating their intrinsic risks. For example, they recommend engaging employees in redesigning work to leverage AI but also designing policies to curtail its threats.

Related: Balancing benefits and costs: a struggle for employers

Both groups recognize the challenge of talent acquisition and retention in such a tight labor market. The report’s authors recommend that organizations map future needed skills and foster a culture of continuous skills development. What’s more, they recommend supporting employees through the adoption of technologies that mitigate employee burnout.

When it comes to benefits, both HR and risk pros are concerned about cost increases. The report’s authors, however, stress that benefit cost increases are a manageable risk so long as organizations concentrate on active plan management. Specifically, they recommend optimizing wellbeing programs by exploring best practice when contracting with providers, using predictive models to understand the population and impact of future spending, and analyzing the whole population to develop joint risk and HR metrics.