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Bersin & Associates Study Shows U.S. Organizations Reinvesting in Human Resources Spending, Staffing

Organizations with Mature Human Resources Functions Spend More on Strategic HR Services, Enjoy Higher Productivity and Lower Turnover

Oakland, CA – June 1, 2011 -- Bersin & Associates, a world-class research and consulting firm that empowers HR organizations to drive bottom-line impact, today announced that U.S. organizations are starting to reinvest in human resources services and staffing following the economic downturn of the past three years, according to findings included in Bersin & Associates’ The HR Factbook 2011: Executive Summary. The full report will be released later this month.

Organizations on average spent 1.4 percent more on HR programs, services and systems in 2011 than in 2010, with $1,218 spent per employee, according to the March 2011 study, the first of its kind from Bersin & Associates. Some of these funds went to hire additional staff, as HR headcount increased an average of 1.8 percent this year. Most organizations focused investments on core services such as compensation, benefits, payroll and employee relations, which accounted for about 60 cents of every HR dollar. Approximately one-third of the HR budget went to talent management, as organizations invested more in recruiting and development initiatives.

“The increased spending on Human Resources shows how businesses around the world are rapidly starting to rebuild their talent pipelines and cores services to engage and retain people,” said Josh Bersin, chief executive officer and president, Bersin & Associates.

On average only about one in 10 HR dollars went to “strategic” HR services, which include employee engagement, workforce planning and measurement, and wellness programs. However, organizations with more mature HR functions spent two-to-three times as much on these initiatives. The efforts of these more mature HR functions pay off. According to Bersin & Associates’ HR Maturity Model® -- those organizations at the highest maturity level have nearly 40 percent lower turnover – and more than twice the revenue per employee – than those at the lowest maturity level. In addition, these highly mature, “business-integrated” HR organizations enjoy 38 percent higher employee engagement than those at lower levels. (Organizations interested in benchmarking themselves against this maturity model should contact Bersin & Associates for more details.)

“Organizations at all levels are now talent constrained and business leaders want to re-engage their workforces to drive innovation and execution.” Bersin added. “Human resources teams are being asked to step up their game: creating more innovative recruiting programs, leveraging the power of social networking for internal and external communications, developing emerging leaders, and helping the organization mobilize talent to take advantage of global business opportunities. These are urgent business problems which require greater investments in HR.”

Conducted in partnership with Human Resource Executive magazine, the research is based on a study of nearly 300 U.S. HR professionals, and included a series of in-depth interviews to better understand key issues and trends. A story about The HR Factbook research appears in today’s Human Resource Executive Online.

Bersin & Associates Principal Analyst Karen O’Leonard said that organizations with mature HR functions clearly will emerge from the recession ahead of the game.

“These mature HR organizations have strong core services and talent management initiatives, enabling their teams to focus on strategic people issues,” said O’Leonard. “Organizations with such mature HR functions will be better able to hire and retain their key talent, expand more quickly, and recover from the recession faster than companies with less mature and effective HR teams.”

Register as a trial member to download a complimentary copy of The HR Factbook 2011: Executive Summary.

The Bersin & Associates study, The HR Factbook®: Benchmarks and Trends in HR Spending, Staffing, and Resource Allocations, will be available until June 20 for $745 for a PDF and $875 in print. Starting June 21 the report will be available for $795 for a PDF and $925 for a hard copy. For more details, go to www. Bersin.com/hrfactbook2011

Those interested in learning more about Bersin & Associates or its WhatWorks® membership may email info@bersin.com or call (510) 251-4400.

For media queries, email laura.evenson@bersin.com or call (415) 465-2711.

About Bersin & Associates

Bersin & Associates empowers HR and learning organizations to drive bottom-line impact through world-class research and consulting. The company’s WhatWorks® membership gives human resources, learning, and talent acquisition professionals the information and tools they need to drive change in their organizations as strategic business partners.

Bersin & Associates members use our insights and tools to benchmark themselves against best practices, design and implement programs across the HR and learning spectrum and select and implement systems.  More than 5,000 organizations worldwide, including more than half of the Fortune 100, use Bersin & Associates research and consulting to guide their learning, talent, and human resources strategies.