Planning for what's ahead: HR priorities for 2025

As we look toward 2025, it's clear that HR and People leaders are navigating a rapidly changing landscape. From the accelerating use of AI in HR processes to the pressure to boost productivity with limited resources, people teams have their work cut out for them! 

Based on insights from two industry experts, Aaron Rodriguez of Capitol Bridge and Dr. Orin Davis of Quality of Life Laboratory Consulting, the priorities for HR in 2025 are becoming more defined — and more urgent.

Streamlining systems + managing talent

One of the key challenges for 2025 is the need for organizations to streamline their tools and systems to stay competitive.

Aaron Rodriguez, Head of Total Rewards, HR Data & Systems at Capitol Bridge LLC, emphasizes the importance of simplifying HR platforms and reducing manual workloads. He notes, "Whether it's using AI or next-gen HR tools, I think everyone is pushing to seamlessly integrate everything and remove as much low-value, manual work as possible." The need for faster, more efficient systems is not just about productivity — it’s about making HR more strategic in a world where resources are finite.

At the same time, Dr. Orin Davis stresses the complexity of getting the right talent in the right places. "Job-person fit has so many moving parts and so many nuances," he says. Figuring out how to attract, hire and retain top talent is more challenging than ever — especially as businesses face economic pressures and workforce expectations continue to rise.

Key insight for 2025: As companies work to find balance, the ability to streamline processes while maintaining a human touch will be critical.

Rewarding employees in a tight economic climate

For many HR leaders, keeping employees motivated in the face of tightening budgets is a top priority.

Rodriguez highlights the difficulty of balancing total rewards with limited financial resources. "In my conversations with other compensation leaders, times when budgets are tight require significant trade-offs. When resources are finite, how can we ensure our broader population is satisfied and feels taken care of, our top employees feel the respect and value we place on them, and maintain a reasonable cost structure?" he asks. Rodriguez mentions different ideas to consider, such as focusing more on incentive pay, and improving high-value benefits.

The larger challenge is navigating employee expectations. After a period of heightened focus on employee wellbeing and engagement, today’s workforce has higher expectations than before. Leaders must manage these expectations even as financial realities grow harsher. Rodriguez also notes, “It’s been hard, as an HR Professional, to see our function cut down so aggressively over the last few years, especially after the investments made during the COVID and immediate post-COVID era. I would love for companies to start investing in the People function and their employees again, rather than only doing it when the stock price is up.”

Key insight for 2025: Employee expectations are high, and meeting those expectations is key boosting engagement and retention.

Building a culture of performance + accountability

For younger companies, developing a strong organizational culture can be particularly challenging. Rodriguez emphasizes the need to foster a culture of collective performance while keeping stress levels manageable. "In earlier stage companies, I’ve seen a delicate balance between maintaining an idealistic, happy, mission-driven culture with 100% satisfaction, while also trying to over-achieve and generate financial wins. Finding that balance between achievement and results versus play, excitement and joy can be tricky — how can a company minimize burnout without lowering our bar? It’s hard to do, but that's the goal," he explains.

This approach speaks to the larger challenge People leaders face in 2025: creating high-performing teams without burning out employees. As expectations rise for both productivity and employee wellbeing, finding that balance will be critical to long-term success.

Key insight for 2025: Building a strong culture of accountability without adding stress is key to driving performance.

Rethinking performance + culture

Revamping performance management is another major focus for 2025.

Dr. Davis argues for a shift from simply measuring performance to actively improving it. "Performance management should go beyond just metrics," he explains. Moving toward a more holistic view of employee development will be key to both individual and organizational success.

Beyond performance, corporate culture itself needs attention. Burnout remains a critical concern, and both Rodriguez and Davis identify this as a major challenge for HR leaders. Rodriguez is focused on fostering a results-driven environment that maintains a low-stress atmosphere, while Dr. Davis emphasizes the need for a broader cultural shift to prevent burnout entirely. Davis highlights the need to “upgrade corporate culture to make it less conducive to burnout.” Both approaches reflect the urgency of addressing employee wellbeing while sustaining organizational performance.

Key insight for 2025: Hustle culture only works in the short term. For long-term success, organizations need to balance business objectives with employee wellbeing needs.

Focusing on diversity, equity and inclusion (DEI)

In addition to addressing burnout and performance management, measuring the impact of DEI initiatives remains a priority. Dr. Davis highlights the difficulty in this area, saying, “Figuring out how to measure the effects of D&I initiatives” is a key focus for 2025. Many organizations have implemented DEI programs, but understanding their true impact – and ensuring they drive meaningful change – will be crucial.

As businesses strive to create more inclusive workplaces, the challenge is now focused on accurately assessing their outcomes. Success will require clear metrics and a commitment to long-term follow-through.

Key insight for 2025: DEI initiatives must move beyond implementation — measuring their impact will be critical for lasting change.

The future of AI in HR: Finding the right balance

One of the ongoing debates for HR in 2025 is the role of AI in hiring processes. Rodriguez sees AI as a valuable tool to streamline systems and boost productivity, while Dr. Davis urges caution. "Hiring is a human process, and we shouldn’t be sending machines to do human jobs" he explains. Dr. Davis believes that hiring should remain a human-centered process and even suggests that we “severely limit the use of  AI in hiring processes, especially when companies need to find top talent.”

This discussion highlights a broader tension HR leaders must navigate: embracing innovation while ensuring technology enhances (rather than replaces) the human element. As organizations increasingly adopt AI to speed up operations, the key will be finding the right balance between technology and the personal touch that defines strong people functions.

Key insight for 2025: The AI transformation is accelerating. People leaders need to participate in this transformation to ensure their businesses stay human.

Bold bets for 2025: Investing in people again

Rodriguez offers a bold prediction for 2025: companies will start to reinvest in their people and HR functions. "It became extremely clear over the last few years that many companies treat employee morale and engagement as a 'nice to have' and not a core part of what they do," he says. He believes the organizations that prioritize their people will win in the long run.

This sentiment reflects a broader shift that HR and People leaders are pushing for — one where employee wellbeing and organizational success are deeply interconnected. As companies plan for the future, the emphasis on people will be a critical factor in determining who thrives in the years to come.

As we prepare for 2025, HR leaders face the dual challenge of innovating and caring for their people in an increasingly demanding environment. The need to simplify systems, reward employees within budget constraints and redefine corporate culture is pressing. 

While technology – especially AI – promises to transform the business landscape, leaders must carefully balance the benefits of automation with the need for human connection. Those who prioritize their people while adapting to new realities will be the ones best positioned to succeed in the future.

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