Last year was a dynamic one for businesses across all sectors. Spokane saw continued growth and diversification with companies from metropolitan centers seeing opportunity in the Inland Northwest and many local companies growing to meet demand as supply disruptions decreased, and digital business solutions helped companies thrive. Here are predictions for what current and emerging trends will further shape businesses in 2024.

Digital tools will continue to unlock operational efficiencies.

Businesses of all sizes and sectors are embracing digital innovation to automate tasks and streamline processes. The new year provides business owners with an opportunity to review their operations and industry best practices to identify how digital tools can help them expertly manage various aspects of their businesses.

The Bank of America Mid-Sized Business Owner Report found that 54% of owners plan to apply for a bank loan or line of credit within the next year, and among that group, 43% plan to use the money to invest in new technologies. For example, 87% of business owners said they plan to utilize more automation and artificial intelligence tools during the year ahead for tasks like hiring, payroll, and accounting.

More than ever before, small and medium-sized family businesses are finding digital tools at accessible price points that support their bottom line through direct efficiencies. Even businesses and brands that focus on their long-standing traditions are seeing the potential for transformation for their customers, their employees, and their future.

Businesses also expect to use more digital payments in 2024, with 76% of owners anticipating all their transactions becoming digital at some point. A confluence of trends and benefits have helped digital payments proliferate, including widespread smartphone adoption and the growth of cloud-based software solutions, as well as increased digital transaction speeds and the additional security through encryption and tokenization.

Small digital makers and businesses are also supporting this trend, bringing their home businesses online for great reach through social media and search engine optimization. The idea that business can be done from anywhere is quickly expanding.

Digital automation will also continue to influence how businesses manage their accounts payable, as digital solutions make it easier and more efficient to process payments, track invoices, and manage cash flow. For vendors and suppliers, this increase in speed brings greater flexibility and ease in day-to-day operations, whether they’re onsite or on the road.

Labor markets are beginning to shift.

The wave of resignations seen over the past few years has slowed, and according to the Bank of America 2023 Workplace Benefits Report, nearly 70% of employees plan to stay with their current companies in 2024.

As more businesses invest in digital tools and AI, they must prepare workers to use these tools properly through upskilling. This is often easily supported by the tools themselves that often come with robust training programs and direct access to account reps to help create processes that work for a particular business model. Bridging the gap between a tool’s potential and company readiness will require a commitment to providing training, and providing that training can help boost employee attraction and retention.

Despite this, labor shortages continue to challenge business owners. This year, we expect mobility between industries to continue as businesses align their hiring models to target skillsets rather than traditional industry experience or even education.

A McKinsey & Co. report notes that hiring for skill is five times more predictive of on-the-job performance than hiring for education, and this practice also widens the potential talent pool. Developing models that help identify and accurately quantify skills is where focus is needed.

Savvy business leaders will continue to make efforts to meet existing and prospective employee expectations in 2024. Our Workplace Benefits Report found that over half of employers currently have in-person work models, but workers continue to value flexibility. Remote work isn’t a good fit for all businesses, but those supporting it in full or part may benefit from greater worker satisfaction and retention.

Strategic partners can help navigate uncertainty.

2024 is a general election year, and with the U.S. presidential election and other global elections, we can expect to see market volatility. Further economic uncertainty will be fueled by mixed views about the likelihood of a recession and when interest rates will decrease.

Fortunately, the stock market tends to restabilize after elections, regardless of which party is in power. Business owners should be prepared to steer their companies and employees through these uncertain times, and one of the best ways to do that is by leveraging the expertise and tools of their strategic partners, including bankers, financial advisers, lawyers, and accountants.

It’s one thing to monitor trends, but business leaders must take advantage of opportunities to adapt now to remain at the forefront later. By embracing changes, supporting digital initiatives, and investing in new strategies to support business objectives, companies can position themselves for success in 2024 and beyond.

 Kurt Walsdorf is the Pacific Northwest business banking region executive for Bank of America and serves as president for Bank of America Spokane.