How to identify workforce needs: a 6-step guide for HR teams

Knowing how to identify workforce needs means comparing the people and skills you have today with the people and skills your business plan will need, then sizing the gap team by team. The output is a short list of needs, each with a number, a skill, a deadline and a decision: hire, train, redeploy or contract.

TL;DR:

• How to identify workforce needs: Compare the people and skills you have with what your business plan requires, team by team. Then decide for each gap whether to hire, train, redeploy or contract.
• Six steps: Start from the business plan, measure current supply, forecast demand, size the gap, pick the fix, and review on a set cadence.
• Two gaps, not one: Headcount gap equals demand minus projected supply, which is current headcount minus expected leavers. Skills gap equals the skills the plan needs minus the skills people can show today.
• Test skills, do not trust self-ratings: In the worked example, 5 agents passed a Tier 2 skills test while 11 listed the skill. Self-ratings would have understated the hiring need.
• Ask every manager the same six questions: Fixed questions give numbers you can add up. "How many people do you need?" gives a wish list.
• Match the fix to the gap: Train people who are close to the bar, redeploy where the skill already exists, and hire when the gap is large or urgent. Check supply every quarter and reset demand every year.

What does it mean to identify workforce needs?

Identifying workforce needs is the diagnostic part of workforce planning: working out how many people, with which skills, the organization will need over the next 12 to 24 months, and how far today's team is from that. Workforce planning then turns those needs into a hiring, training and budget plan.

A workforce needs assessment answers four questions for every team:

1. Supply: Who do we have today, with which skills, and who is likely to leave?
2. Demand: What work will the business plan create, and what roles and skills does that work need?
3. Gap: Where are we short (or over) in headcount and in skills, and how urgent is each gap?
4. Decision: For each gap, do we hire, train, redeploy or bring in contractors?

The University of Cambridge's workforce planning toolkit frames the same idea as understanding where you are now, defining future needs, and identifying the gaps you must close. The order matters less than doing all four with real data.

Speed is the reason it matters now. Deloitte's 2026 Global Human Capital Trends found that 7 in 10 business leaders say their main competitive strategy for the next three years is to be fast and nimble. A team cannot move fast if it learns about a skills gap only when a project is already late.

Why should you identify workforce needs before you hire?

Identifying workforce needs before you hire turns hiring from a reaction to resignations into a plan the business has agreed to. Without it, open roles get approved one at a time, skills gaps show up after a launch slips, and the same profiles get hired again even when the work has changed.

The benefits are practical:

• Fewer rushed hires: When you know a need six months out, you can source, assess and onboard properly instead of filling a seat under pressure.
• Better use of budget: Training a person who is close to the bar usually costs less and takes less time than hiring a new one.
• Clearer approvals: Finance and leadership approve headcount faster when each request ties to a number in the business plan.
• Less bias in who gets picked: A defined skill need lets you assess every internal and external candidate against the same bar.

Leaders feel the gap already. The LinkedIn 2025 Workplace Learning Report found that 49% of L&D and talent development professionals say their executives are worried that employees do not have the right skills to execute the business strategy. A workforce needs analysis is how you turn that worry into a list of specific skills, teams and dates.

What signals show you have a workforce need right now?

Workforce needs usually show up in operational data before anyone files a headcount request. Watch for these signals, team by team:

• Overtime and backlog: Overtime hours, ticket queues or project backlogs that grow for two or three months in a row.
• Slow time to fill: Roles that stay open far longer than your average, which often means the skill is scarce or the role is defined badly.
• Rising attrition: A rising attrition rate in one team or role, especially among recent hires.
• Single points of failure: Critical knowledge held by one person, or key people close to retirement.
• Missed deadlines tied to one skill: Launches that slip because only a few people can do one type of work.
• Underused capacity: Teams with spare capacity, which signal a redeployment option, not a hiring need.

Pro tip: Put these signals on one monthly dashboard per department. When two or more flash for the same team, run the full six steps below for that team instead of approving a single requisition.

How to identify workforce needs in 6 steps

The six steps below follow the supply, demand and gap model that public-sector toolkits and HR teams use, with one change: skills are measured, not guessed.

Step 1: Start from the business plan

Begin with where the business is going, not with the org chart. List the goals for the next 12 to 24 months that change the work: new products, new markets, new locations, automation projects, cost targets, or big customer contracts.

For each goal, write the workforce question it raises. "Open a Spanish-speaking support line in Q3" becomes "How many bilingual agents do we need by July, and how many do we have?"

Step 2: Measure current supply

Supply is the workforce you will still have when the need arrives. Pull these numbers from your HRIS for each team:

• Headcount and full-time equivalents by role and level
• Expected leavers: historic attrition by role, known retirements, planned internal moves
• Contract types and contract end dates
• Skills each person can actually show today

The last item is where most analyses go wrong. A skills inventory built from self-ratings or job titles tells you what people believe they can do. Short, role-based skills tests or work samples tell you what they can do now, on the same scale for everyone. A skills matrix then shows the results by team.

Step 3: Forecast demand

Demand is the work the plan creates, translated into roles, volume and skills. Use the simplest method that fits your data:

• Ratio method: Workload per person times forecast volume. If one support agent handles 900 tickets a month and volume will grow 20%, you need 20% more agents at the same productivity.
• Manager estimates: Structured input from department heads (see the questions below).
• Scenario planning: A base, high and low case for uncertain plans, each with its own headcount.

For new skills, describe the work first, then the skill. O*NET OnLine lists the tasks, skills and tools for hundreds of occupations and is a useful starting point for a new role profile, alongside a proper job analysis.

Step 4: Size the gap

Subtract projected supply from demand, team by team. Do it twice: once for headcount and once for skills. A team can have enough people and still have a skills gap, or have the right skills and too few people. Label each gap by urgency (needed in 3, 6 or 12 months) and by impact on revenue, customers or compliance.

Step 5: Pick the fix

Each gap gets one owner and one decision: hire, train, redeploy or contract. The decision table further down shows when each option fits.

Step 6: Review and repeat

Workforce needs change whenever the plan changes. Agree on a review cadence now, and record the assumptions behind each number (volume growth, attrition rate, productivity) so the next review can check them.

How do you calculate a workforce gap? A worked example

A workforce gap is calculated as demand minus projected supply, where projected supply is current headcount minus expected leavers. Run the same sum for each critical skill, using people who pass a skills test as supply.

Here is an illustrative example for a 50-agent customer support team planning 12 months ahead:

The example shows why the two gaps belong side by side. The headcount gap tells recruiting how many people to hire. The skills gap tells them which profile 3 of those 27 hires need, and tells L&D which 4 agents to train first.

Key takeaway: A gap number is only as good as the supply data behind it. If "5 pass the skills test" had been "11 list Tier 2 on their profile", the team would have hired too few specialists and found out in month four.

What questions should you ask department managers?

Department managers know where the work is going and where it is stuck, so their input belongs in every workforce needs analysis. Ask the same questions for every team so the answers can be compared:

1. Which goals in the business plan will change your team's workload in the next 12 months, and by how much?
2. Which tasks will be new, and which will shrink or be automated?
3. Which roles are hardest to fill or cover today?
4. Who on your team is close to the next skill level, and what would it take to get them there?
5. Where would losing one person stop work?
6. If you could add capacity in only one place, where would it be and why?

Carmarthenshire County Council's workforce planning guidance calls manager input "a sensible starting point" and pairs it with a supply and demand template. The template matters: free-form conversations tend to produce a wish list, while fixed questions produce numbers you can add up.

How do you choose between hiring, training and redeploying?

Choosing between hiring, training and redeploying depends on three things: how big the gap is, how soon you need it closed, and whether anyone inside the company is close to the skill bar.

Internal mobility is often the fastest option and the one most often missed, because nobody checks internal skills before posting the job. The LinkedIn 2025 Workplace Learning Report found that 55% of career development champions call internal mobility a higher priority for the year ahead. For roles where training is the answer, see upskilling and reskilling, and for a deeper look at when a gap does not need new headcount, read not every skills gap needs a headcount.

What data and tools help you identify workforce needs?

The data to identify workforce needs mostly sits in systems you already run. The work is pulling it into one view per team:

• HRIS and payroll: Headcount, FTEs, tenure, contract end dates, attrition by role.
• ATS: Time to fill, offer acceptance and pass-through rates by role, which show where hiring is slow or the bar is unclear.
• Skills assessment platform: Objective skill scores for current employees and candidates on the same tests, so internal supply and external candidates can be compared.
• Operational systems: Ticket volumes, project backlogs, sales pipeline, production output, which drive the demand forecast.
• Labor market data: The BLS Employment Projections show which occupations are expected to grow, which helps you judge how hard a hire will be.

A spreadsheet is enough for a first pass. As the number of teams grows, workforce analytics and skills gap analysis tools save time and keep the numbers consistent between reviews.

How often should you review workforce needs?

Workforce needs should be reviewed on two clocks: check supply every quarter and reset demand once a year with the business plan. Run an extra review whenever the plan changes, such as a new product, a reorganization, an acquisition or a hiring freeze.

A simple calendar works for most mid-size and enterprise teams:

• Monthly: Signal dashboard (overtime, backlog, time to fill, attrition) per department.
• Quarterly: Update supply numbers and skills scores; re-check the top five gaps.
• Yearly: Full six-step analysis aligned with budgeting.

What mistakes should you avoid when identifying workforce needs?

The most common mistakes in identifying workforce needs come from skipping steps or trusting the wrong data:

• Starting from requisitions: Adding up open roles describes the past, not the plan.
• Counting heads but not skills: A full team can still be short of the one skill the plan depends on.
• Using self-rated skills: Self-ratings and job titles overstate supply. Test the skills that matter.
• One number for the whole company: Gaps live in teams and roles. Average them and they disappear.
• Treating every gap as a hire: Training and redeploying are often faster and cheaper for people who are close to the bar.
• No owner or date: A gap without an owner and a deadline is a finding, not a plan.

Across the teams we talk to, the first two mistakes cause most of the late hires. Once the needs are clear, move to the next stage with the different steps in workforce planning and how to implement a workforce plan.

Measure skills before you plan your next hire

Testlify helps HR and TA teams measure the supply side of the gap with evidence. Assess current employees and candidates on the same role-based tests from a library of 3,500+ validated tests, compare scores by team, and see who is ready now, who is close, and where you need to hire. Results sync with 100+ ATS and HRIS tools, so the numbers feed straight into your plan.

Browse the Testlify test library or book a demo to see how skills data fits your next workforce review.

Frequently asked questions