As the mid-point of an already sometimes turbulent decade, 2025 promises challenges for many parts of your organization. Read on to learn what HR departments and business leaders would be wise to anticipate in the months ahead, as PeopleFluent Product Marketing Manager, Katie Coleman, discusses six HR trends to watch.

1) Skills-Based Approaches Will Be the Key to Employee Success

The need for upskilling and reskilling isn’t going anywhere, and while 2025 won’t be that much more of a watershed year for skills than 2024 was, it will continue the same upward trajectory for a strategy that should already be a cornerstone of your business. In 2023, Employers in a World Economic Forum survey estimated that 44% of workers’ skills would be disrupted by 2028. Employers also anticipated a structural labor market churn of 23% of jobs—a mixture of newly emerging jobs and eliminated positions.

These shifts make helping employees acquire new skills essential. Employees will be more likely to both join and stay if your learning programs open up a career path that makes sense to them—and a skills-based approach will help you create better outcomes when business requirements lead to the elimination of certain positions.

Of course, there’s no benefit in helping employees acquire skills for the sake of acquiring skills: organizations need to use strategic workforce planning to match existing and prospective skills with organizational objectives. This process helps leaders identify current risks and business-critical capabilities, and build a plan for closing skills gaps.

It wouldn’t be a trends article without a mention of AI. Though one study suggests that only 23% of employers are currently using a generative AI solution in HR, another suggests that 54% of leaders expect AI and GenAI to deliver cost savings for their organizations.

AI technology is important to mention in relation to skills for two reasons. Firstly, there’s the fact that the skills market for AI operators and individuals who can help you strategically integrate generative AI technologies will inevitably continue to grow in the next year. Helping employees acquire these skills will be a priority.

Secondly, AI should be integrated into tools that help you understand your organization’s skills landscape. Solutions such as PeopleFluent’s own Stories platform can algorithmically map a standardized skills framework for your business across all of your connected platforms. It can then continuously assess and suggest how to close skills gaps.

LEARN HOW TO USE AI IN YOUR SKILLS-BASED APPROACH | ‘Leveraging AI for Talent and Skill Development Strategies in Regulated Industries’

2) Leaders and Managers Will Have Urgent Development Needs That Must Be Met

The high degree of growth in skills is just part of a wider trend of growing complexity in the workplace, and individuals at leadership and management level are feeling the strain. Gartner’s take on the top HR trends for 2025 includes its finding that 75% of HR leaders say managers are overwhelmed, and that 70% feel that their current leadership programs are not preparing managers for the future.

This problem requires a long-term solution: development strategies, ideally collaborative in nature, that leverage lasting professional relationships, on-the-job learning, and regular touchpoints to steer development in the right direction. Failure to address these needs runs the risk of leaders and managers looking elsewhere—so HR needs to get the ball rolling early in 2025.

3) Organizations Ignore Pay Transparency at Their Peril

DEI may be a politically charged issue, but it still matters to many employees. EY found that “63% of worker respondents would choose a company that prioritizes DEI over one that does not”. Meanwhile, the 2024 Edelman Trust Barometer Special Report found that 42% of consumers believe that brands need to do more on fair pay specifically.

It’s worth highlighting that multinational businesses have laws outside of the U.S. to consider: the 27 member states of the European Union are in the process of complying with the EU Pay Transparency Directive, for example. And back in the U.S., state-level laws have been moving in a clear direction of travel set by legislation such as California’s Pay Transparency Law.

Ultimately, by strengthening your employee compensation practices and fixing pay inequities in your organization, you stand to enhance employee morale and productivity, improve trust and communication, and increase job satisfaction.

DISCOVER MORE ABOUT PAY EQUITY | ‘How to Implement Transparent Pay Policies and Improve Equity in Your Organization’

4) HR Departments Will Have to Prioritize Data-Driven Decision Making

Such an emotive topic perhaps serves as a timely reminder that there still needs to be a data-driven basis for whatever difficult decisions HR departments make in 2025. Data-driven decisions ensure that you make better-informed and objective choices about employee management. In turn, this approach leads to:

• Increased productivity
• Better ability to attract talent
• Improved employee retention
• Reduction or elimination of bias
• Greater alignment of your strategy with your overall business goals
• Visibility into potential compliance issues and a path for corrective action

This data needs to be collected and analyzed in order to be useful in this way, of course. It is therefore imperative that your HR software supports your talent management and people development by providing you with the insights you need.

5) Organizations Must Ensure Change Management Readiness

The upheaval caused by the preceding trends will require a high degree of organizational resilience. Gartner found that 73% of HR leaders believe their employees are already experiencing change fatigue, and a similar percentage (74%) stated that managers are not currently adequately equipped to lead change.

Resilience and readiness for change management never fully come from the top of your organization. While it’s important for leadership to have and articulate a vision for change, it can be difficult for employees to feel fully on board when they are several steps removed from high-consequence decisions that make a real difference to their day-to-day work experience.

How do you empower employees in your change process? Once you’ve set the groundwork of being transparent and ready to communicate clearly about the changes required, you should consult those impacted by the change for their opinions and concerns. It may also be useful to identify employee influencers within your organization who can assist with your communication and feedback efforts. Messaging may be better received if it comes from someone with strong interpersonal connections in the affected teams, and employees may be more willing to air honest concerns to a peer.

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6) Thriving Businesses Will Continue to Emphasize Employee Experience and Wellbeing

Finally, and the logical place where all preceding trends lead, is the observation that the organizations that excel in 2025 will be those that put their people first. HR’s job will remain to focus on driving productivity and engagement through all facets of the employee experience.

This will require an approach that treats employees as individuals—employers should always be on the lookout for ways to personalize tasks, communication, development, and other aspects of working life. Consider how you can customize tasks to take advantage of unique skillsets and strengths, while encouraging your managers to meet regularly with their reports and pay attention to their wellbeing.