The Future of HR - Trends to Watch for in 2025

The role of human resources has shifted from a transactional administrative function to one of a strategic partner that contributes significantly to organisational success, employee satisfaction, and helps drive the business forward. In this ever-evolving industry, it’s important to keep ahead of the game, therefore we explore emerging HR trends and look at what they really mean for the future of your business and your employee experiences.

Unlocking HR Potential with AI

Artificial intelligence (AI) is revolutionising the HR landscape, with generative AI leading the way. Being an early adopter of this cutting-edge technology presents a real opportunity for company growth. 

According to a recent study by Gartner, 38% of HR leaders have explored or implemented AI solutions to help improve process efficiency within their organisation and ensure ongoing results for the company. 

Likewise, the same report tells us that 76% of HR leaders believe that if their organisation does not adopt and implement AI solutions in the next 12 to 24 months, they will be lagging behind in organisational success compared to those that do.

AI-powered tools are streamlining processes such as recruitment, onboarding, and employee management, with such technologies offering data-driven insights and automating routine tasks, thus improving overall decision-making.

However, AI adoption raises ethical concerns. Bias in AI algorithms and the need for transparency in AI-driven decisions are significant challenges faced by businesses. As organisations increasingly integrate AI into their HR processes, they must balance efficiency gains with ethical considerations and remember that, above all, people like to deal with people.

Reskilling and Upskilling

By 2030, it is estimated that nine out of 10 workers will require upskilling as a result of the Covid-19 pandemic accelerating changes to the world of work, according to a report from the Confederation of British Industry (CBI). The report, based on research conducted by McKinsey, predicts that 26 million workers will need to upskill and refresh in order to stay relevant in their evolving roles due to technological and business advancements. Additionally, five million workers will require fundamental retraining as their jobs undergo significant transformations.

The CBI report acknowledged the government's focus on skills but also noted that automation and technological changes had already threatened jobs prior to the pandemic. Low-skilled roles at high risk of automation often had low training rates, high unemployment, and low wages. Workers in these jobs were less likely to receive training than higher-skilled workers, and many had received no further training at all since leaving school.

Younger generations, particularly Millennials and Gen Z, are eager to learn, develop their skills and grow. It is estimated that about three-quarters of them would leave a job that didn't offer opportunities for skill development and progress throughout the company. This shows there is a strong appetite for upskilling and reskilling and it is something that needs to be taken into consideration.

Flexible Working

Flexible work hours and arrangements are becoming increasingly common with companies seeing more and more employees requesting a more flexible working model. HR professionals and departments can play a crucial role in ensuring that these arrangements don't disadvantage employees in terms of career opportunities and flexible working opportunities can work towards overall employee satisfaction.

From working mothers who wish to only work part time in order to manage childcare and school runs, to those who want to be able to work outside of traditional office hours simply to attain a better work/life balance, offering flexible work is a great boon to a company who wishes to ensure the wellbeing of its staff members, helping to create a more positive workplace environment, as well as to attract and retain top talent.

Furthermore, if the Covid-19 pandemic taught us anything, it is that businesses are willing and able to adapt to new ways of working and managing staff. So many millions were condemned to home working during lockdown, that this has now not only become part of the norm, but it also highly desired by many employees and potential new recruits, with a recent report by Accenture stating that 83% of employees prefer a hybrid working environment, combining both office attendance with remote working.

Digital Learning and Development

Technological advancements and the overall shifting of learner preferences are fuelling the rapid evolution of the e-learning market – this is, online learning from the comfort of one’s own home and laptop.

On-demand learning such as this offers learners the flexibility to access content whenever and wherever they need and desire it, making it ideal for informal learning and a less stressful experience for the learner.

AI and Machine Learning (ML) are transforming the e-learning landscape. By analysing learner data, these technologies enable personalised and bespoke learning packages to be created, identifying knowledge gaps and recommending relevant content to assist the learner. AI-powered virtual assistants and chatbots provide instant support and feedback, further enhancing the learning experience. As AI evolves, adaptive learning systems will further cater to individual needs.

Likewise, microlearning has become a popular e-learning trend. Today's learners value short, focused learning sessions that are accessible anywhere, anytime, and on any device. Mobile learning enables learners to engage with content on the go, making education more convenient and overall creating a more inclusive work environment. Microlearning and mobile learning enhance knowledge retention and suit busy schedules, making them preferred learning methods.

The Age of the Silver Worker

The amount of older workers has increased significantly of late, as more individuals aged 75 and over choose to remain in the workforce. This may be due to several factors, including employees not being able to afford to retire, to them choosing to wish to remain in the working world. However, many organisations are ill-equipped to accommodate the needs of the ‘silver worker’. Rigid work policies, outdated office layouts, and a neglect of older workers in employer branding strategies are common culprits.

This presents a significant opportunity. By embracing silver workers, companies can harness not only their wealth of experience, but also foster knowledge transfer, and create more diverse and dynamic teams. Just as early adopters of pay transparency gained a competitive edge, organisations that prioritise the needs of older employees will be well-positioned for success in the coming years.

Mature workers seek purpose and recognition. By valuing their contributions and creating a workplace that accommodates their needs, companies can capitalise on their skills, strengthen generational diversity, and demonstrate a genuine commitment to the wellbeing of their ageing customers.

Employee Mental Health

The financial markets remain volatile due to ongoing uncertainty about interest rates and high inflation, a situation expected to persist into 2025. Rising living costs, coupled with job insecurity and financial worries, are contributing to increasing anxiety and burnout among workers.

Mental health issues affect approximately 15% of working-age individuals globally. Gen Z and millennial workers are particularly vulnerable, with 40% and 35% respectively reporting frequent or constant stress and anxiety, and nearly half experiencing burnout, resulting in annual losses for companies due to depression and anxiety of employees.

To address this mental health crisis, organisations must recognise and acknowledge the connection between employee wellbeing and productivity. HR departments must adapt workplaces to support current and future generations of employees in a rapidly evolving world. This involves addressing social and structural factors that impact mental health, equipping employees with the necessary resources for success, fostering resilience, and removing barriers that hinder full participation from individuals with mental health conditions. By taking these steps, both employees and employers can reap the benefits of a healthier, more adaptable workforce.

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