The role of HR departments of companies is growing amid a shortage of workers

As the well-being index of Russian job seekers, which reflects their assessment of personnel risks and prospects, grows, it will become increasingly difficult for employers to hire the necessary personnel, according to data from hh.ru. According to the Gaidar Institute for Economic Policy, companies’ hiring plans for this fall remain high, although they have dropped somewhat compared to August. In such conditions, the role that HR departments play in the business of various companies will become increasingly significant, and top HR specialists will have a chance to grow into CEOs.

In the fall of 2023, the Russian labor market may face a further reduction in the number of active resumes and a disproportionate increase in the number of vacancies. However, although this will negatively affect the business of many companies, it will give HR departments arguments for further expanding their role in the structure of enterprises. This conclusion was reached by the participants in the sessions of yesterday’s hh.ru conference “HR-Digital 2023”.

As Natalya Danina, head of the client efficiency department at hh.ru, said, the shortage of personnel is now most noticeable in areas with mass hiring, where workers and service personnel are needed. “This includes transport, retail trade, manufacturing, and construction – the number of active vacancies in these industries significantly exceeds the number of resumes. A similar trend is gaining momentum among white collar workers,” she notes. Job seekers, according to Ms. Danina, lose interest in looking for work because they are satisfied with their current place and are not sure that they can find something better. Thus, the aggregate indicator of worker sentiment in the Russian labor market in the third quarter, the job seeker well-being index, improved and reached +0.037 points (+0.003 points). The stability index at the current job reached a record 0.45 points in the history of sentiment measurement (0.24 in the second quarter of 2022 and 0.42 in the second quarter of 2023).

Given this behavior of job seekers, hiring new employees may become more difficult for companies, especially against the backdrop of record demand for labor in the Russian economy, which was recorded by TsMAKP experts. Let us remind you that it reached 75.7 million people, the maximum since January 2020 (for more details, see Kommersant on September 12).

In conditions of chronic personnel shortage, Russian industry continues to hire personnel and maintains “high—almost record-breaking—plans for its further recruitment,” according to the market research laboratory of the Gaidar Institute of Economic Policy. According to their estimates, in August the balance of hiring plans, although it decreased by two points, still remained close to the record. Let us remind you that in July Rosstat estimated the unemployment rate in the Russian Federation at 3% – this is the minimum since 1991. As Mikhail Belov, deputy head of the monetary policy department of the Bank of Russia, noted, in the future, limited labor resources will restrain economic growth and may not allow it to overcome the pre-crisis level.

The difficult situation in the labor market, due to which personnel problems have ceased to be exclusively the difficulties of HR departments, in turn, provokes businesses to change their attitude towards these departments. As Mikhail Arkhipov, Vice President for Personnel and Management System of NLMK Group, notes, now for many companies personnel issues are coming to the fore, strengthening the role of HR departments. “This also provides new career opportunities for heads of HR departments – in the next couple of years, we will increasingly see them becoming CEOs of companies. Previously, candidates for this role most often came from departments related to finance,” he says. The influence that HR specialists have on a company’s business is growing, as they have more and more stakeholders not inside the company, but outside, says Natalya Volodina, a lecturer at the Faculty of Market Technologies at the Institute of Industry Management of the RANEPA. “We see that HR departments are now taking on GR functions, as they are forced to interact more with industry-specific government institutions. On the other hand, an increasing number of their personnel decisions may become public and negatively affect the company’s image,” she notes. At the same time, according to Anastasia Khrisanfova, Director of Organizational Development and Managing Partner of UpScale11, although such a vertical track for HR specialists is now indeed becoming more likely, those wishing to take the position of CEO must carefully prepare for such a transition: “To successfully lead a company , what is now needed is not only a set of skills that can be provided, for example, by Executive MBA programs or specialized programs in financial management, but also a set of soft competencies and knowledge, for example, about interaction with shareholders and the external environment – clients, partners, regulators – and strategic thinking. To acquire these, it helps to work one-on-one with a mentor who has business leadership experience during the pre-transition phase and in the first few months as CEO,” she says.

Anastasia Manuilova