HR will be dealing with seismic changes in the workforce based on regulatory shifts and the economic outlook for 2010 that will significantly impact decisions in using new technology and processes.

Economic Outlook: The sun will shine tomorrow and jobs will come back and GDP growth will come. With the thawing out of the great economic seizure of 2008 – 2009, companies will start to spend, but it will not be business as usual for HR departments as they will be putting out fires rather than thinking strategic. As such, do not expect HR to automatically have fuller coffers and be an active buyer. Much of what will be purchased will be piecemeal at least until companies have a good 12 months of modest growth under their belts.

Employee Engagement: If it was not hopelessly broken before, now it is official, employee loyalty is history. Most studies agree that a full 50% turnover in the workforce in 2010 is a real likelihood. For companies, this is a nightmare scenario given that most find themselves understaffed with an already overworked, underpaid and underappreciated workforce.

This means firms that help companies with employee engagement strategies will find themselves very busy. Many companies will simply resort to the tried and true tactic of throwing money at their “star” performers. Smarter companies will look more broadly across their workforce and start to identify the “stars in waiting”, working to develop targeted engagement strategies to foster loyalty and commitment. These firms will easily outperform the old guard.

Regulatory Challenges: While it is still in the works, healthcare reform has the potential to blow a giant hole in HR’s budget. The changes will be significant and costly to implement. This will be a boon for companies like Ceridian and ADP in the benefits/ payroll space, but not so much for the companies that have to change the way they manage benefits.

Even more broadly, the current business environment has shifted away from the loose regulatory regime enjoyed over the past three decades towards a much more command control environment of heavy government involvement. The result is more scrutiny, more rules and more effort to comply with onerous regulations around unionization, OSHA and a host of worker related matters.

Workforce Analysis: While HR is not going with innovative, a burdening class of technologies is starting to emerge that is starting to get more visionary HR leaders excited about the future. Firms such as Inforhrm, Vemo, WingSpread and Aruspex are leading the way in a category that provides HR and corporate leadership the tools to view their workforce talent strategically and analyze the best path toward aligning workforces to be more productive. This has been a bit of the holy grail for HR in tying their activities to actual business outcomes, which if successful, could raise the visibility and strategic importance of HR.

Social Media: Social media is catching steam, but it is unlikely that adoption will suddenly explode this year in HR. Instead, we can expect to see a slow trickle of interest over the year. Social media will however be the next major wave of HR technologies to roil the HR field the following year once this year of adjustment and fire-fighting dies down. Then we should see some interesting things!