HR Tech Number of the Day: average HR tech budgets

An increase in HR technology spending was largely driven by new COVID-related requirements.
By: | October 23, 2020 • 2 min read


$483: The average amount that employers spent on HR technology per employee per year

Most employers spend roughly $40 per employee per month on HR technology and services this year, according to new research from Valoir and HRE. More than a quarter of HR professionals (27%) reported an increase in HR technology budgets since the beginning of 2020. The majority of HR pros (61%) said budgets remained unchanged since the beginning of the year, and 12% reported a cut in tech budgets.

What it means for HR leaders

The COVID-19 pandemic is largely changing the workplace—and that includes HR technology. The increase in HR technology spending was largely driven by new COVID-related requirements, including support for remote work and technology needed to manage reopening requirements, such as contact tracing and health reporting. On average, HR reported an increase in spending of $4.05 per employee per month for technology to support remote work.

“We are only beginning to see the impact of the pandemic on HR technology investments, and technology to support remote work and reopening are just the tip of the iceberg,” says Rebecca Wettemann, CEO and principal at Valoir, a technology industry analyst firm. “As companies and employees navigate remote work, HR leaders are looking at new ways to keep employees connected and engaged beyond just surveys and videoconferencing.”

Related: HR leaders plan to embrace remote work post-pandemic

Productivity management and wellness monitoring tools, AI-driven talent management and marketplace applications, and technology that supports the whole employee experience—like virtual volunteering and coaching—are areas where we’ll see increasing investment, Wettermann says.

“Employee experience can no longer be just check-ins or surveys,” she says. “People data and people analytics are key to understanding and managing employees in this evolving environment.”

Hear more about these and other trends at the HR Tech Conference, a free and virtual event held Oct. 27-30. For more information or to register, click HERE.

Kathryn Mayer is HRE’s benefits editor and chair of the Health & Benefits Leadership Conference. She has covered benefits for the better part of a decade, and her stories have won multiple awards, including a Jesse H. Neal Award and honors from the American Society of Business Publication Editors and the National Federation of Press Women. She holds bachelor’s and master’s degrees from the University of Denver. She can be reached at kmayer@lrp.com.