My 8 HR Predictions for 2025

As we head into 2025, HR will face major shifts driven by capital efficiency, AI adoption, and evolving workforce expectations. Here are the biggest trends shaping the future of work:

Human Capital Efficiency Will Redefine Workforces

In 2025, your CEO will demand stronger justifications for growing teams—or even keeping humans in certain roles. Capital efficiency is no longer optional.

We’ve already seen early adopters. Klarna, a $50B company, reduced its team from 5,000 to 3,800 employees as it implemented AI to handle customer queries. Meanwhile, revenue per employee increased by 73%. Others will follow, not just for cost savings but to stay competitive.

Even if layoffs aren’t happening in your company, expectations are shifting: employees will be expected to do more, faster.

📌 What this means for HR: You can either be part of this conversation or be left out until decisions are made. Proactively research how companies are optimizing teams and suggest efficiencies—before leadership decides for you.

AI in Every Department

By the end of 2025, AI-powered tools will be deeply embedded into daily work across departments.

Your engineers may use AI-powered coding assistants like Cursor to write and debug code faster, your marketing team may use tools like Claude to generate high-quality content at scale, and your sales team may use Lindy to speed up outreach.  

📌 What this means for HR: Stay ahead of AI adoption. When discussing headcount, factor in AI’s impact on productivity alongside traditional resourcing conversations.

Further De-Investment DEIB

Despite some optimistic predictions (like this predictions post by Lattice), I believe DEIB budgets will shrink more. Why? From conversations with HR leaders, investors, and CEOs, I think it’s clear that the pullback in 2024 will continue into 2025.

The shift started during the US election cycle, where anti-woke sentiment gained traction and many CEOs who once openly championed DEIB initiatives became noticeably quieter. The reality is that many DEIB efforts are no longer seen as core business priorities.

📌 What this means for HR: If you want to keep DEIB initiatives alive, tie them directly to business outcomes. Frame them in ways that align with leadership’s priorities—productivity, retention, and innovation.

Big Funding Bets on Fewer Startups

The venture funding landscape isn’t drying up—it’s shifting. Instead of spreading bets across many startups, investors are making larger, concentrated bets on a handful of unicorns.

A recent FT article outlined how Thrive Capital is focusing heavily on a few massive bets—like OpenAI—rather than investing in a broad portfolio of early-stage startups. This contrasts sharply with the pandemic-era funding spree, where capital was more widely distributed.

📌 What this means for HR: Surprisingly few HR leaders have access to metrics like burn and revenue per employee —make sure you do.

Work Reimagined, as a Product

HR will increasingly treat employees like customers, applying product-thinking to improve engagement and satisfaction.

This includes Personalized employee experiences—delivering timely, relevant content based on role, tenure, and career goals.

To do so, teams define their employee journeys tracked like customer journeys—optimizing touch points from onboarding to offboarding.

A recent HBR article explored how employees now “hire” jobs to fulfill specific needs, much like customers choose products.

📌 What this means for HR: Start thinking of employee experience like a customer experience funnel. Where are the friction points, and how can you optimize them?

DIY HR: More Teams Will Build Instead of Buy

Smaller HR teams are ditching expensive platforms and doing it themselves - thanks to AI. AI makes it easier to build, tweak, and scale HR processes without vendor lock-in.

Take People Analytics—what once required specialized software and data teams can now be handled with AI, pulling insights from spreadsheets in seconds. Employee feedback? AI can draft surveys, analyze responses instantly, and highlight key trends—without an external survey platform. L&D? AI now recommends personalized learning paths dynamically, reducing the need for traditional LMS platforms. Career paths and competency-framework implementation can now be achieved without an expensive platform

📌 What this means for HR: Experiment! I learned how one company built its entire competency framework using AI - including behavioral examples and coaching prompts by role and level - to help managers to coach their team. You can do the same.

HR Tech Will Follow a Familiar GTM Path

HR tech is evolving just like Go-To-Market (GTM) tech did.

GTM initially launched great self-service platforms (like booking your flight on Expedia) to now proactively, in-the-moment guidance (like getting a targeted Ad when something has happened in your life)

Companies have already made progress with tools like Glean, ServiceNow, and AI-driven task resolution. But in 2025, this will accelerate: employees won’t just search for answers or get stuff resolved more easily —HR will surface the right guidance at the right time.

Imagine a newly promoted manager automatically receiving leadership training tips, relevant HR policies, and task nudges within their existing workflow. This evolution moves HR tech from a back-office function to a real-time performance enabler.

📌 What this means for HR: Research tools dominating the Employee Experience Layer—reactive platforms like Glean & ServiceNow, and proactive solutions like Pyn.

A New Era of Manager Enablement

The cognitive load on middle managers has been rising in recent years, with more tasks and responsibilities being added to their plates.

To ensure their continued success, companies find new ways to have manager focus on tasks that matters most—while minimizing time and mental energy spent on lower-value tasks.

Smarter processes will support managers by synthesizing relevant team data, providing timely guidance, and eliminating busywork like collating reviews, searching for templates, or tracking milestones.

📌 What this means for HR: Pinpoint the most critical aspects of management and streamline everything else— empowering managers to be more confident and driving more consistent performance.

Final Thoughts

2025 will be a year of working faster, smarter technology, and leaner teams.

Companies that thrive will be the ones that embrace point-of-need HR support and AI, optimize for efficiency, and rethink how HR delivers value.

The question isn’t whether these shifts will happen—it’s how fast.