Gartner, Inc. announced recently the top three trends shaping the Australian workforce in 2025 that HR leaders must navigate – new CEO growth ambitions, AI deployment hurdles and ongoing shifts in the labor market.
According to Gartner, HR leaders must understand how the following three trends and priorities will shape their strategies in 2025 and beyond (see Figure 1).
Figure 1: Top Trends and Priorities for Chief HR Officers in 2025
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Source: Gartner (December 2024)
Fifty-six percent of CEOs cited growth in their top three business priorities for 2025, according to a July 2024 Gartner survey of 110 CEOs and business executives. This was followed by technology (42%) and corporate – organizational structure and operating models (36%). Workforce (21%) fell two places down the priority list to fifth place for 2025.“CEOs are increasingly recognizing the role HR plays in transformational growth, especially in aligning the workforce to power the ambitions of the organization,” said Whittle. “HR leaders must elevate HR’s impact on organizational strategy to support these ambitions in 2025, shifting focus from the HR function to the broader workforce.”
Gartner recommends HR takes a two-pronged approach:
- Understand where the organization’s growth bets are, the assumptions behind them and how HR can enable success.
- Identify talent risks that might impede these bets and create a talent strategy that redeploys people to high growth areas.
Trend 2: AI Aspirations Confront Deployment Realities
According to the Gartner survey, 74% of CEOs said AI is the technology that will most impact their industry in 2025. However, the path to big value gains from AI will prove slower and harder than organizations anticipated due to factors including data issues, uncertainty about best practices, employee skills gaps and change fatigue.
“The hype around AI, especially GenAI, has resulted in organizations attempting to adopt the technology at breakneck speeds, but they’re finding the highly touted productivity and business benefits don’t always materialize,” said Whittle. “They often neglect the necessary planning and change management programs that ensure the workforce is ready for the transformative change it can bring and enable teams to realize its full potential.”
HR leaders must prioritize building a deep bench of change leaders in 2025. Gartner recommends HR coach leaders and managers to not only communicate and demonstrate desired changes, but also operationalize them by aligning their teams’ structures, processes and policies to support the desired change.
Trend 3: Labor Market Shifts Put Pressure on Talent Strategies
According to Gartner, the top three drivers of declining availability of critical talent for 2025 are labor shortages, mismatched skills and employee expectations. A Gartner survey of 194 Australian candidates collected between July and September 2024, revealed 41% of job seekers declined an offer that did not match their expectations and 67% exited the hiring process due to at least one mismatch in employee value proposition (EVP) preferences.
“In Australia’s challenging labor market, strategic workforce planning is now more complicated due an increasing pace of change, decreasing labor supply and training not translating into readiness,” said Whittle. “To turn this around, HR leaders must create a future-ready workforce in 2025 by shifting from headcount planning to capabilities-led, integrated strategic workforce planning.”
Gartner recommends HR leaders start by assessing the capabilities of the organization’s talent and the role of culture, organizational design and EVP in shaping them. Then focus on segmenting talent roles by their impact on delivering workforce capabilities, identifying gaps and creating scenarios for the future state of their organization.
