Nearly two-thirds of employers (64%) spend over 570 hours a year and at least 11 hours per week on HR administration. The survey by Paychex covered U.S.-based business with between five and 500 employees. In addition, the study found that annual spending for the largest businesses is as high as $350,000 on HR tasks such as processing payroll, administering benefits and tracking time.
Overall, the top business challenges identified were rising interest rates (65%), inflation (63%) and the threat of an economic slowdown (63%). In addition, the top HR challenges included risk management, such as managing workers’ compensation (56%), leadership development (54%), and attracting talent, total rewards and offering competitive benefits and compensation (53%).
AI Problem Solving
Nearly all leaders (98%) expect these challenges will push them to use AI in 2024. In fact, 85% said they are already using it. Less than 10% are concerned with AI risk.
“Our study also found that organizations are spending more than a quarter of the average 40-hour work week on administrative HR tasks, costing them significant amounts of time and money,” said Paychex Vice President of Enterprise and HR Solutions Jeff Williams. “To offset these costs, almost all respondents said they will lean on emerging technology like AI to lighten the load on them, their employees and the bottom line.”
Currently, employers are most commonly using AI to automate workflow, grow sales and manage business intelligence and analytics. In addition, some of the new reasons respondents plan to implement AI in the next 12 months include supporting customer service, strengthening IT operations and screening resumes of potential candidates.
People management was also cited as a focus for leaders, with 53% planning to optimize their benefits to attract and keep high-quality employees.
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