What’s next: 2025 HR trends to watch

These days, the end of the year is as much about looking forward than reflecting on the past 12 months. We're all riding the waves of change, so it's hard not to spend some time predicting what's next.

This is especially true in the fast-changing world of HR. A sea of operational challenges and ever-changing employee expectations are making it difficult to focus on what will truly move the needle, especially with a constrained budget.

This past year brought us the widespread application of generative artificial intelligence (AI) into everyday work, controversial return to office mandates, the continued rise of flexible contingent work, and numerous global service failures and cybersecurity breaches. In addition, new compliance requirements in 2024 added even more complexity to workforce planning.

We checked in with some of Dayforce's executive thought leaders to find out what they're anticipating will matter most this year. Here are our top HR trends and predictions that we think will shape your workforce in 2025.

Finding harmony between employee expectations and budget

"As organizations place greater emphasis on profitability and cash flow, they are actively seeking efficiencies and optimizing existing resources. In 2025, strategic HR leaders will need to collaborate closely with CEOs and the C-suite to drive business transformation and fuel growth." - Amy Cappellanti-Wolf, Chief People Officer, Dayforce

How can you balance business needs while creating an environment that attracts, retains, and nurtures the best talent? HR leaders need to ensure they are strategic partners during this period of continued uncertainty, guiding their executive leadership team to the right balance of productivity and performance. This starts with access to intelligent technology to help you make better decisions and optimize your workforce in multiple ways, including your company culture.

Balancing AI in the hiring process

"Employers and candidates have fully embraced the power of AI in the hiring process. In 2025, the swing back to the human element will be the most important trend in talent acquisition." Steve Knox, Global Head of Talent Acquisition, Dayforce

Talent acquisition teams are struggling with volume when it comes to the early stages of the hiring process. With the help of AI, there's an opportunity for hiring teams to be able to refocus more of their time on more strategic work, such as interviews and talent assessments. Technology can now be part of the complete hiring process, which opens the door for new risks, putting the onus on technology providers to create AI that supports compliance and is ethical. HR teams need to re-think their AI strategy and the human element of their talent strategy to help set their hiring teams, new employees, and organization up for success.

Tapping into contingent work

"Labor strategy will be top-of-mind, requiring businesses to tap agile, experienced contingent workers to fill fluctuating labor demands." - Erik Zimmer, EVP Corporate Development and Strategic Ventures, Dayforce

Businesses around the world are feeling the economic crunch. Leaders need to find new ways to remain resilient while doing more with less. Simultaneously, your bench may be lacking the right skills as innovative technologies such as AI continue to accelerate. Tapping into experienced workers with different skillsets can help your organization fill different needs in this rapidly changing environment.

Promoting your employer brand

"Employer brand will be more important than ever as workers prioritize job security in 2025." Steve Knox, Global Head of Talent Acquisition, Dayforce  

Only 55% of global respondents to our latest Pulse of Talent Survey are actively looking for a new job or are open to new opportunities, down from 70% the year before. Unlike past trends like the Great Resignation, economic uncertainty could make many workers less willing to leave their stable jobs. This means a strong employer brand will become critical to stand out from competitors and attract the best talent. You want to be well known as a great place to work, with more people doing the work they're meant to do.

Even more compliance complexity

"In the UK, with Labour's Employment Bill of Rights potentially changing sick leave and maternity leave policies, rules around redundancy and dismissals, and flexible work legislation, employers need to ensure they manage compliance on day one. HR teams will need to embrace technology and real-time data to help ensure they are effectively navigating this growing complexity." - Nicole Bello, Group Vice President for EMEA, Dayforce

"On the back of the right-to-disconnect law, the introduction of new wage theft legislation in Australia will bring compliance to the forefront, as organisations face a balancing act between agility and efficiency and staying up to date with new labour laws. A data-first, localised approach to HR will be key to navigating this growing complexity, with the help of technology." - Brian Donn, Managing Director, APJ, Dayforce

The next round of compliance changes has the potential for ripple effects across the world. Previous regulations such as the General Data Protection Regulation (GDPR) can apply to the personal data of people living in the European Union (EU), no matter where your company is located. From changing working time regulations to new wage theft legislation, organizations need to ready themselves for new compliance complexities in the coming year. As employment requirements change around the world, take stock of your workforce to help ensure that your people are paid and scheduled accurately for their region.

With a new presidential administration taking office in the U.S., the potential for shifts in policy and enforcement there - and continuing complexity at the state and local levels - is not just anticipated, but expected.

Juggling your digital transformation and security strategy

"2025 will be the year when the CIO title will become obsolete. Instead, expect to see more leaders evolving themselves into a more strategic Chief Digital Officer role, juggling digital transformation, financial impact, and most importantly, security, at once." - Carrie Rasmussen, Chief Digital Officer, Dayforce

Everyone is excited about the opportunity that comes with new tech. But finding the right balance of innovation and managing risk will be one of the top challenges for technology leaders. And that can start with preparing your organization's environment for AI. More Chief Digital Officers will be tasked with managing cybersecurity best practices on how their employees and partners are using AI and data.

Refining and sharpening your AI use

"The notion that bigger is better will fade as organizations begin to recognize the pitfalls of excessiveness with AI models. Narrowing the sources of data and scope of information allows the LLM to become highly specialized around what best serves an individual organization. Refining the focus helps ensure the output is relevant and doesn't waste sources on unnecessary knowledge or capabilities.

For example, an apparel retailer doesn't need its large language model (LLM) to know about agriculture or medical research - training the AI to understand nuances about textile supply chain mechanics and the specific payroll processes of the organization is more beneficial. And privately hosting the dedication LLM helps facilitate increased security, less bias, and enhanced accuracy." - David Lloyd, Chief AI Officer, Dayforce

Not everything is a nail, but it can look like it when you're wielding a hammer. After a Gen AI boom across the world of work, here at Dayforce, we believe solving real business problems should always be your goal with innovation. A key 2025 HR trend will be mindful applications, or in other words, don't "peanut butter spread" AI without a clear strategy.

Also keep in mind how your partners and employees are currently using AI . It's critical to build your AI vision and share your policies to help manage the risk exposure that comes with adding to your tech stack. Now is the time to implement governance to educate your employees about how to ethically use AI-enhanced tech and lean into enablement with guardrails because of that potential risk.

Preparing for 2025

Nothing moves faster than the trend cycle. And when it comes to working with people, nothing could be less predictable. But that doesn't mean anticipating workforce trends isn't worthwhile. Understanding these 2025 HR trends can help you prepare for upcoming challenges and opportunities. Leaders around the world are preparing for economies, technologies, and labor markets to all shift in response to change. Strategic HR leaders know that helping your people do the work they're meant to do is essential for driving productivity, engagement, and ultimately your business forward.

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