It's time again to dust off that crystal ball and make predictions for the year ahead. Looking back to last year's predictions, they hold up so long as we ignore the many noteworthy exclusions! 

The significant leadership changes, major conflicts and phenomenal technology transformations of last year will continue to impact in 2025. Australians are also facing an upcoming federal election in a year that leading economists say offers no quick economic fixes. All of this suggests that 2025 has the potential to be disruptive. 

We've highlighted some key areas where HR can help organisations successfully navigate uncertainty.

1.     Adopting and guiding technological transformation

Why is technological transformation a HR priority? Most people with smartphones or who work in an office role are already using AI in some capacity. However, strategic adoption in the workplace is still a work in progress for many organisations. A report from the Australian Institute of Human Resources (AIHR) has highlighted critical areas where HR practice and technology will converge. 

According to AIHR's HR Trends in 2025 report, HR will need to play a larger role in encouraging AI experimentation and advocating for training, driving an organisational AI strategy, and creating governance systems to ensure the responsible use of AI to balance organisational interests with employee anxiety. 

If your organisation currently has employees using random AI tools through open software, personal subscriptions, or alternatively resisting technological change, you are not alone. This is why HR needs to play a key role in communicating and implementing AI strategy and adopting a community approach to AI to achieve effective outcomes. 

Technology can be an overwhelming challenge for HR practitioners. AIHR research found that just 12% of HR professionals regularly use AI, and only 41% have the capability to keep up with HR digital transformation. Furthermore, 55% of HR leaders say their technology solutions do not cover current and future business needs. 

AIHR recommends adopting an AI growth mindset within the HR team, supported by a risk framework for AI adoption in HR that offers a clear roadmap for safe and effective use. Internal or external support may be required to build capability, with measurement critical to ensuring it meets the required goals. 

This approach will help HR drive broader transformation and be part of the organisational journey. 

2.     Shifting talent dynamics

Organisations have been grappling with new expectations and emerging workstyles. However, much of the focus has been on Gen Z and Millennials. In 2025, the pendulum in the employer/employee power balance is swinging back to employers, which means HR's role as a champion for employees will need to take place while balancing costs and alleviating employee anxiety over job stability and performance demands. Communication, people-centric work policies, and investment in high-performing employees will be critical. 

However, some other factors are driving Australian HR professionals this year. Namely, the push for equity in the workplace, driven by the Workplace Gender Equality Amendment in 2023, and workers aged 75 and up being the fastest-growing workforce segment. While this challenges HR, it enables HR to creatively impact organisational outcomes. 

For years, significant data has been produced to support the positive link between profitability and gender diversity. Yet structural barriers such as inflexible work practices and a lack of leadership opportunities remain critical issues, which HR will continue to address. 

While parental responsibilities have been addressed, caring responsibilities for aging parents and the long overdue conversation about the impact of menopause are also starting to take place. A 2024 Australian Senate Report on Menopause found a lack of awareness and acknowledgement of the implications for women with severe menopausal symptoms has resulted in women either reducing their hours or leaving work altogether, often at the peak of their careers.

With increased cost of living, 'unretired' employees are also here to stay. Yet only 8% of Diversity, Equity, Inclusion, and Belonging strategies include an age component. AIHR recommend implementing mentoring programs and knowledge-sharing initiatives to encourage intergenerational collaboration, help bridge skills gaps, and support the ongoing development of organisational capabilities. Consider continuous learning programs and project work rather than daily work with urgent deadlines and phased retirement plans. 

3.     Developing anti-fragile workers for engagement

Research suggests that constant change, overwork, economic uncertainty, the high cost of living, and job insecurity tax exhausted and stressed employees. With more than four in 10 people reporting feeling burned out at work globally and numbers higher in Australia, the resilience approach of the last decade requires a revision.

AIHR proposes an antifragility workplace strategy, addressing social and structural factors to turn adversity into an opportunity for growth. While some may find this buzzword cringeworthy, the underlying goal deserves consideration. Given the rapid pace of change, it is critical to create an environment where growth and adaptability are prioritised, empowering employees to thrive throughout their careers. 

How? Training employees to anticipate future challenges through cross-functional projects, innovation labs, scenario planning and risk-taking/management. This includes creating an environment where people can experiment and make mistakes to learn, encouraging healthy work/life boundaries, and supporting employee health through work flexibility and a focus on health. Organisational policies and strategies will need to support this approach.

4.     Integrating workforce planning and management  

While workforce planning and management are core functions for human resources, practitioners often face barriers to workforce planning. According to a Gartner Report on Priorities for HR Leaders in 2025, CEOs have overwhelmingly selected organisational growth as their priority for this year, with 79% of CEOs having their post-crisis business strategies ready for 2025. Yet only 28% of HR leaders agree that the HR strategic planning process is fully integrated with the business planning process. 

The report suggests strategic workforce planning needs to include headcount planning one year ahead, succession planning for up to two years, and planning for skills and capability building across two plus years. This can be for leaders, so workforce planning should be considered when solving problems that align with organisational goals. Phasing the deliverables, data, talent strategies, and staffing also helps, as does working with partners. 

Understanding market demand and skill shortages is critical in developing workforce planning strategies. A recruitment partner can assist by providing external talent mapping, contingent workforce management, targeted search, and recruitment support so that HR can focus on strategy and specific tactical elements.

5.     Immersive leadership development

Traditional leadership development doesn't work for three reasons: timeframes, cost, and approach. Only 36% of leaders think their development programs are effective, and HR is specifically concerned about the gaps in leaders who can meet future challenges. 

Leaders are navigating so much change, from economic and market uncertainty to technology and employee expectations and work preferences, it is no wonder that time spent on their development is an issue. Being absent while in seminars and lectures can have a negative impact on an enterprise and doesn't necessarily promote ongoing development. Furthermore, many development programs require a significant financial commitment, which may not be adaptable to changing organisational budgets and needs. 

The Gartner Report suggests people need time to build lasting connections for ongoing development. This means embedding relationship-building events into development after leaders have had to apply what they have learned. It creates thought-provoking, trusted peer connections that facilitate problem-solving of individual and shared challenges. When utilised, leaders are 18% more likely to become enterprise leaders.

Contact the Bayside Group today for assistance with recruitment and workforce management solutions.