Many industries have been gravitating towards automation in their business processes. Automation has become increasingly common in the human resources industry, but has been met with much skepticism. In a survey of HR managers on behalf of Career Builder, 55 percent of them said that they believe that artificial intelligence will become a regular part of HR in the next 5 years.
The benefits of automation in HR are numerous. HR managers who do not fully automate lose an average of 14 hours a week completing tasks manually than can be automated. HR managers have said that using old, manual processes can lead to lower productivity, more errors, higher costs, and lower employee engagement.
Here are four ways that HR professionals are currently using automation to streamline their job functions:
Payroll is the most commonly automated aspect of HR today. The survey from career builder shows that 50 percent of HR managers say that their payroll is fully automated, while 42 percent say that their payroll is partially automated. The primary reasoning behind automating payroll is to save time and eliminate human error.
Payroll automation allows for computing wages, deducting mandatory withholding such as income and social security tax, and streamlining of record keeping. The American Payroll Association has estimated that automation can reduce processing costs up to 80 percent. From this, it is clear that automating payroll can be very beneficial.
Background Checks/Reference Checks
Another area in HR that is shifting to automation is background checks, reference checks, and pre-employment drug screenings. From the survey of HR managers, 74 percent said that this process is either fully automated or partially automated.
Background checks are automated through companies that can access criminal records from multiple databases across the web. This is a much more efficient method of conducting a background check, rather than the HR professional contacting individual courthouses themselves to gather information. Reference checks are typically automated by software that sends inquiries to reference sources where the reference can respond confidentially.
This method can at times fall short because it does not allow for an interactive conversation between the reference and the HR professional.
Many companies use applicant tracking systems that have the ability to sort through thousands of applications and return information such as an applicant’s work experience, where they got a degree from, any management certifications or other training, and any other keywords that are specific to the job posting. HR managers have said that 38 percent of their job applicant tracking is fully automated while 35 percent said that it is partially automated.
These applicant tracking systems save HR professionals a considerable amount of time that would otherwise be spent sorting through thousands resumes in an attempt to find a qualified candidate. The efficiency of these ATS have led to widespread adoption of automation in applicant tracking.
Benefits administration is another aspect of HR that has been shifting into automation. Of the HR managers that were surveyed, 83 percent of them said that their benefits administration system is either fully or partially automated. These benefit programs are usually automated through a portal that employees are able to access themselves. In this portal, they can manage their insurance options, time off, and additional benefits themselves. This self-service model of benefits administration frees up time for HR professionals that would otherwise be handling employee requests themselves.
In a study by Software Advice, they estimate that HR professionals spend roughly 80 percent of their time handling paperwork and administrative tasks revolving around insurance enrollment.
Though some methods of automation can have their own issues, the general consensus among HR professionals is that automation leads to increased productivity, less waste, and lower costs. Automation is something that will continue to develop, so it will be interesting to see how automation is used in the human resources industry ten years from now.
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