The employment landscape has been in a state of constant transformation over the last half-decade. At Success Portraits, we’ve dedicated a considerable amount of time to this discussion. We find ourselves frequently returning to the conclusion that this is a uniquely challenging time for employers.
Our current state of transformation may have been sparked by the temporary conditions imposed by COVID-19 crisis. But today, we’re seeing something more profound than the lingering effects of a crisis. We’re seeing a genuine shift in employee expectations, a generational turnover in organizational demographics, and technologically-powered changes in the way we do work.
Together, these conditions are also reshaping the mission of Human Resources (HR) professionals and departments. As the nature of employment evolves, so too must your organization’s HR department evolve. With that in mind, we offer an overview of what you can expect in the coming year and beyond.
10 Human Resources Trends to Look Out For in 2025
Of course, your HR department will still be tasked with the traditional range of responsibilities from recruitment and onboarding to training and leadership development. But many HR professionals are embracing change, incorporating new tools, and implementing new strategies to better handle these responsibilities.
Read on for a look at the biggest trends we anticipate in the HR field in 2025.
1. AI-Driven Analytics and Decision-Making
Let’s start with the obvious. We’re living in the midst of some potentially momentous technological changes. AI and machine learning are having a profound impact on the labor landscape. This has particular bearing on the work of HR professionals.
A recent article in Forbes points out that AI technologies have the potential to enhance and refine the way we find, engage with, screen, and hire candidates. HR departments that become adept at leveraging these technologies can ultimately do their work more efficiently and more accurately. The article in Forbes notes that “AI tools can automate the creation of job descriptions, screen resumes, identify where the most promising candidates will be found and even assess factors such as cultural fit.”
Moreover, incorporating capabilities like predictive analytics into the hiring process can help your HR department make data-driven decisions on everything from hiring to performance management, employee engagement, and learning development.
2. Remote Work Optimization
Of the many lasting changes in the post-COVID era, perhaps remote work will be among the most persistent. The benefits of both remote and hybrid working arrangements have become fairly self-apparent to employees and employers alike.
For the latter, remote work offers an opportunity to cut down on commuting costs, improve work-life balance, and enjoy greater autonomy. For employers, remote work reduces the costs associated with onsite work including energy consumption, resource usage, and the cost for the physical space itself.
For HR departments, this shifting workplace arrangement demands adjustment. In 2025, expect that companies will be more focused on finding the right balance between onsite, remote, and hybrid work. HR departments must take the lead in helping to formalize and refine strategies that result in more seamless, flexible working environments. This will include learning how to implement advanced virtual collaboration tools, adjusting workplace policies to facilitate increased flexibility, and updating employee handbooks and codes of conduct to accommodate a new range of working arrangements.
3. Employee Health and Wellness
The pandemic laid bare the importance of prioritizing employee health, hygiene, and wellness. It also underscored the need for greater preparation. During the pandemic, companies were largely caught off-guard by the sudden closures, worker shortages, and company-wide outbreaks of illness. These events demonstrated the need to have plans in place for such events.
According to an article from SHRM, most businesses anticipate future pandemics. This is why, the article notes, the “vast majority of business executives—83 percent—say they expect to hire more people for health and safety roles within the next two years.”
In addition to enhancing preparation for the next major socioeconomic disruptor, this shift also speaks to changing worker expectations. Younger generations are seeking working opportunities that align with personal wellness objectives including fitness, mental health, and positive lifestyle decisions. For HR departments, this means ensuring that working opportunities offer a combination of thoughtful and mutually beneficial health policies, benefits, and initiatives.
In 2025, expect to see a greater focus on holistic wellbeing programs that integrate mental health support, stress management, fitness initiatives, and financial literacy workshops into the employee experience.
4. Personalized Leadership Development
Many businesses have grappled in recent years with the rising costs of recruitment, hiring and turnover. This challenge is only magnified by the rapidly transforming set of skills required for success in a 21st century workplace. Many businesses are meeting these conditions by placing a greater emphasis on internal leadership development.
This is an approach that creates greater long-term opportunity for your best team members. It also has the potential to reduce the heavy financial toll imposed by employee turnover. For HR professionals, this means taking an active role in identifying personnel with leadership potential, creating pathways for upward mobility, and guiding employees toward opportunities for education, training, and certification.
AI technology can support these priorities by helping your HR department customize leadership journeys; identify areas for upskilling and reskilling; and distill matches between employee career goals and organizational priorities. But it also means finding thoughtful, ethical, and reliable ways of spotting team members with the potential for both leadership and longevity. In 2025, we anticipate that many HR departments will be focused on finding the strategies that work best for their respective organizations and industries.
5. Changing Wage Rules
Employers are keeping a close watch on changes in the laws around both employment and payroll management. At both the federal and state levels, new legislative initiatives are complicating the outlook for labor costs. According to an article from leading payroll management company ADP, “Trending wage-and-hour issues in the United States — from work time, overtime rules and state tax changes — may pose challenges for employers in the coming year. At the state and federal levels, salary threshold changes for overtime have motivated some organizations to raise wages to exempt certain employees.”
Some states are even exploring the idea of redefining and expanding upon who can qualify as a full-time worker. For instance, in some states, there are measures under consideration that would allow those working 4-day, 32-hour work weeks to qualify as full-time employees. If passed, such measures would alter the calculus for who receives full-time employee benefits. It would also likely shape hiring decisions and impact the balance between salaried workers, hourly workers, and independently contracted employees.
For HR professionals, this means much of this year will be spent both adjusting to new payroll rules and anticipating what these rules will mean for hiring and compensation decisions in the coming years.
6. Diversity, Equity, and Inclusion (DEI) Initiatives
In its first iteration, DEI has largely referred to a set of policies aimed at removing barriers to inclusion, recognizing the effects of institutional inequality, and taking steps in both hiring and employment to mitigate these effects. But for an emergent generation of employees, investors and consumers, DEI is seen as both a philosophical imperative and a practical priority.
Such is to say that there is expectation for these values to be embedded in company culture. Many prospective high-quality hires recognize diversity as a feature that strengthens an organization’s potential for growth, innovation, and competitive edge. But it isn’t enough to merely pay lip service to these values. This evolving perspective also places the onus on companies to demonstrate the measurable outcomes of DEI initiatives.
A leading HR trend in 2025 will be a greater focus on producing and highlighting these outcomes in areas like pay equity, representation in leadership roles, and inclusive leadership training. Moreover, you can expect that, in 2025, HR personnel will be increasingly focused on adopting recruitment, hiring and leadership development strategies that address and eliminate potential biases.
7. Rising Freelance Workforce Integration
In the face of both rising employment costs and the move toward more remote work, many companies are reevaluating their balance between in-house workers and freelance or short-term hires. And over the last decade, we’ve also seen a rise in the so-called “gig economy”.
A larger percentage of workers today operate as independent contractors, freelance creatives, and third-provider service providers. Moreover, outsourcing has become an ever more practical, accessible, and viable solution for businesses of all shapes and sizes. As a result, many organizations are exploring new ways of blending full-time, freelance, and gig workers into their workforce.
For HR personnel, this means establishing new policies around contractor management, benefits, and compensation structures. And as businesses look for ways of tilting the balance further toward 1099 workers, it also means that HR departments must take a more active role in areas like quality control and compliance oversight.
For a closer look at the challenges that come with finding this balance, check out our comparative discussion on W2 vs. 1099 employees.
8. Workplace Automation
In an earlier section, we discussed the role that technology is already playing in helping HR departments improve and refine recruitment and hiring strategies. But these technologies are also changing the way we work, and the skill sets we seek in prospective employees. For HR personnel, one of the key trends in the new year will be helping their organizations adjust to these changes.
Automation in particular is having a transformative impact on the role of humans in the workplace. But that doesn’t simply mean, robots are replacing human workers. Instead, many organizations are leaning more heavily on automation to support human work, reduce the burden of repetitive tasks, and create more opportunities for human-powered creativity, leadership, and innovation.
Today, businesses are investing simultaneously in advanced technologies, training protocols for existing employees, and recruitment strategies that prioritize new hires with the ability to leverage these technologies.
Indeed, according to the article from SHRM, “85 percent of companies accelerated the digitization of their businesses, while 67 percent sped up their use of automation and artificial intelligence. Nearly 70 percent of executives say they plan to hire more people for automation roles, while 45 percent expect to increase hiring for positions involving digital learning and agile working.”
HR departments will take a lead role in helping their organizations navigate these changes as well as helping personnel adjust to changing roles and responsibilities.
9. Continuous Feedback Loops
One of the key lessons from the post-pandemic labor landscape has been a shift in employee attitudes. Many workers are prioritizing job satisfaction and cultural compatibility today in ways that previous generations simply didn’t.
For organizations, this changing landscape means greater emphasis must be placed on workplace morale, organizational culture, and recognition of evolving employee needs. Expect a greater focus on collecting, analyzing and responding to employee feedback in 2025. We expect more active use of annual performance reviews, channels for continuous feedback, and real-time performance evaluation tools.
AI tools will likely play an important role in helping HR teams track performance, collect feedback, and evaluate employee needs. But HR personnel will also be required to channel their unique skills and insights into setting goals, identifying employee development opportunities, and mediating conditions to improve job satisfaction and company morale.
10. Competency-Based Assessment
Some businesses are confronting their employee shortage and turnover issues at the roots by changing how they assess prospective new hires. While traditional assessment tools like resumes, academic degrees, and interview performances remain relevant to the process, there is a growing recognition that these tools may also cast too narrow a focus on their own.
For many employers, the solution is in incorporating a wider range of assessment tools into the process. For instance, notes the article from ADP “many employers have adopted a skills-based approach to talent. This approach includes evaluating candidates on skills and potential (rather than solely in-position experience or formal education), implementing upskilling programs to train employees on skills crucial to business success and investing in internships and other programs that help build a stronger talent pipeline.”
The ADP article points out that 90% of the organizations using competency-based approaches have reported a reduction in mis-hires. 94% of respondents also say that hiring based on skills and competencies has actually proven more predictive of job success than resumes. We expect that many HR professionals will take steps in 2025 to incorporate effective, balanced, and ethical competency-based assessment tools into their recruitment, hiring, and leadership development strategies.
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At Success Portraits, we’re focused not just on delivering meaningful competency-based assessment, but also on providing nuanced reporting to help users make sense of the resulting data. That’s why we include a full and growing array of downloadable reports with each completed assessment.
Employers who leverage the Success Portraits Personality Test (SPPT) for support during the hiring process will benefit from resources like our Interview Questions Report. Employers who download this report will receive interview questions that are specifically tailored to align with the personality traits demonstrated by each individual test-taker. This offers hiring managers a way of customizing interviews around the most relevant skills and traits reflected in every candidate.
The SPPT also provides employers with resources that are customized to help personnel advance along individualized career paths. For instance, the downloadable Coaching Report can provide employers with personalized coaching advice and development plans based on each employee’s personality scores. This report will offer practical and actionable strategies for helping to foster employee growth and performance. Likewise, the downloadable Key Areas of Improvement report can help you pinpoint specific areas of potential growth for a given candidate or employee based on individualized personality scores.
Taken together, these reports can help ground both your hiring and career development strategies in deeper and more individualized insights. Check out the Success Portraits Personality Test (SPPT) For Employers and find out how our assessments and reporting can help improve your hiring and retention outcomes.