Human resources technology (HR tech) refers to the software and hardware tools that are used to assist in all of the human resources aspects of an organization. The human resources sector covers a wide variety of functions and responsibilities, and can generally be split into different areas based on the main purpose or types of tasks. Components of HR Technology include:
- Benefits administration
- Payroll and compensation
- Performance management
- Recruitment and talent management
- Workforce management
These types of technologies are collectively referred to as Human Resources Information Systems (HRIS), Human Resources Management Systems (HRMS), or Human Capital Management (HCM) solutions. Vendors offering HRIS solutions provide a wide range of tools to support employee life cycle management and other workforce management tasks. Other technologies include Employee Self-Service (ESS) tools or systems that support employee well-being and health. With the growing shift to the digital workplace, companies are realizing the increasing need for employee-centric environments and workflows, and recent trends reveal a growing focus on mental health resources as well.
AI technologies are increasingly incorporated into the HR technology market to provide smarter and faster solutions. The top three applications of AI in HR tech can be seen in recruitment and onboarding, internal mobility and employee retention, and the automation of administrative tasks. AI can be used to make talent acquisition management more efficient, personalize employee experiences, and facilitate scheduling, compensation, and productivity tracking. Read the Market Overview for more details on AI applications in this area.