Workforce Forecasting: How To Predict Staffing Needs In 7 Steps

Workforce forecasting is the key to remaining competitive in the business landscape; however, only 40% of companies currently enforce it.

Effective workforce forecasting enables an organization to analyze supply and demand on an internal scale, therefore avoiding talent shortages, reducing turnover, and maximizing team potential.

Regularly monitoring your staffing needs is an essential part of the workforce management process. The question is, how do you implement workforce forecasting into your current business strategy?

With this in mind, let’s take a closer look at the benefits of workforce forecasting for your own business management. We share seven easy strategies for predicting staffing needs in 2025.

What is Workforce Forecasting?

Workforce forecasting is the process of auditing a business’ workforce to identify skill gaps, establish staffing needs, and predict long-term supply.

Forecasting involves taking a look at historical workplace data in order to highlight workforce trends over time and identify any weak spots within the organization. 

By leveraging data from years past, HR teams can map patterns for peaks and troughs in demand and use this to predict future demand for specific roles or skills.

The Benefits of Workforce Forecasting 

There are plenty of benefits associated with strategic workforce planning. Some of these include effective HR allocation, greater levels of productivity, and a rise in job satisfaction as workloads are distributed evenly amongst a healthy number of employees.

With this in mind, some of the other key benefits associated with workforce forecasting include:

• Reducing Staff Shortages: If a business efficiently forecasts its staffing supply, they are less likely to experience staff shortages in times of increased demand due to the fact that they have planned ahead to prepare for business growth.

• Meeting Long-Term Business Goals: Workforce planning allows a business to think three steps ahead of its competitors. In order to meet long-term business goals, forecasting the need for future skill sets ensures a business has the right number of employees at the right time to achieve specific business objectives. This effective resource allocation reduces the need for excess hiring and onboarding, saving money for the business. 

• Increased Job Satisfaction: Forecasting workforce supply and demand ensures that your business is always well-equipped to handle business objectives with ease. This puts less pressure on current employees, increasing job satisfaction and retention as a result. 

• Minimizing Legal Risks: Finally, accurate staffing audits allow businesses to spot any workforce changes that might impact regulatory compliance in the near future. In this case, businesses can proactively plan for these changes ahead of time and adapt the team accordingly.

Workforce forecasting allows a business to hire staff members with long-term business goals in mind. This is essential in a landscape that requires managers to think three steps ahead when making any business decisions.

How To Forecast Your Own Staffing Needs In Seven Steps

Now that we’ve learned about the benefits of workforce forecasting, let’s put the process into practice. Here are seven workforce planning strategies to add to your own staffing management plan in 2025.

Define Your Business Goals First

Effective workforce forecasting should directly align with your business goals. In order to see success within your staffing strategy, ensure that you’re hiring three steps ahead of time. For example, if you’re working towards an important business objective over the course of a year, audit your team early for any missing skill gaps and hire accordingly in order to effectively work towards the ambition.

To define your business goals, first conduct strategic planning sessions with senior leadership to discuss and establish key objectives the organization is working towards.

Once you’ve set measurable KPIs, create a workforce alignment map that directly links each business objective with the required staffing supply.

Audit Your Current Workforce For Skill Gaps

Once you have your business objectives in mind, it’s time to start analyzing your current workforce.

This process involves evaluating your employees and their current roles and skills. The key here is to look for any skill gaps or room for improvement.

In order to effectively audit your workforce, consider the Delphi Method. This is a forecasting framework that uses consultations/surveys to gather information from inside your organization.

Using the Delphi method, you can source opinions on labor demands from those working within the business. This is always a great indicator of what the workload is like on the ‘shop floor.’ You’ll find that surveying your employees generates the most accurate data for your HR team.

Another way to do this is to perform a gap analysis. Comparing your current workforce skillset with your future needs can help you identify which skill gaps need to be filled in the next round of hiring.

Analyze Your Supply

Another key feature to take into account during a workforce forecasting session is your current supply. The key here is to identify any mismatches between your current supply and future demands.

You can do this by looking at any potential challenges that could affect the size of your current workforce. These factors include retirement, high department turnover, and economic trends that could affect labor market conditions.

Another area to analyze is your future talent availability. Assess what the current talent pool looks like. Do you have any hiring pipelines or internal skill pools? If talent availability is low, consider flexible workforce planning, such as upskilling in-house or recruiting freelancers to cover any skill shortages.

Stay Up to Date on Industry Trends

Industry trends are ever-changing, and they can significantly affect your hiring strategy. When planning your workforce, ensure that you are up to date with any regulatory shifts, technological advances, and economic movements that could impact your future hiring requirements.

We suggest that you network with industry partners, monitor your competitors, and stay subscribed to industry journals and publications.

For example, a restaurant may track trends in online delivery adoption in their area in order to forecast the need for more delivery drivers.

Leverage Automation

The use of AI in business is on the rise. Not only can artificial intelligence handle large sets of complex data analysis in seconds, but it can also help HR teams highlight workforce trends and make predictions about future staffing trends.

As more HR teams embrace technology to streamline their roles, workforce forecasting has never been easier in a digital landscape.

The key here is to invest in forecasting software that seamlessly integrates with your HR system. This will allow your team to access data in real time and automate any routine tasks, such as data entry, to free up more time for strategic planning.

Plan for Workforce Development

Once you’ve identified skill gaps and hired from your talent pool, the work is certainly not over. 

Planning for future workforce development plays a key role in a successful workforce forecast. Instead of analyzing your team for hiring gaps, look at how you can further enhance your current workforce to reach new business goals.

This includes training, upskilling, and reskilling, as well as re-positioning current staff members into new roles.

The key here is to create an in-house development program and monitor its progress. These programs could focus on leadership training, digital learning, or even soft skill workshops. Spending time working on your current workforce can reduce the need to re-hire and better prepare your business for growth with little to no expense.

Identify Any Future Challenges

Workforce planning and forecasting is all about looking ahead. Regularly monitoring your workforce productivity is the key to maintaining a competitive position.

In fact, those who regularly audit their workforce spot future challenges before they impact company growth. For example, are your employees working long hours? This could lead to burnout during high-demand periods.

Are remote workers more productive when they come into the office? This could indicate the need for a restructuring of the working environment.

Prepare for any future challenges by constantly looking ahead. This ensures that you foster a happy, healthy workforce.

Wrapping Up

Workforce forecasting plays a crucial role in a strong business management strategy.

With the ability to think three steps ahead of the game, you can proactively hire based on individual business goals, engage with talent pools before competitors, and stay ahead of labor trends.

The key here is to constantly audit your workforce and identify gaps for improvement. Those who prioritize filling skill gaps early on will see the most growth in a competitive hiring market.