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If 2024 was all about discovering new talent, human resource leaders are using 2025 to focus on cultivating the employees they already have.
Last year, the number one priority for top HR executives was recruiting, and figuring out ways to hire workers with in-demand skills like AI expertise, according to the 2025 State of the Workplace released by the Society of Human Resource Management (SHRM). But this year, recruiting fell to seventh place, showing that CHRO priorities are changing drastically in 2025.
Instead, leadership and manager development took the top spot among focuses for HR professionals, according to separate study from SHRM, with 51% of CHROs saying it was their main concern. That was followed by organization design and change management at 30%, employee experience at 28%, talent management at 27% and learning and development at 24%.
“It’s really about ensuring that the employees you have at your organization are working towards being productive, and that you can retain that talent,” says James Atkinson, VP of thought leadership at SHRM. “We’re seeing a focus from recruiting outside the organization to really building up and developing talent within the organization itself.”
The new emphasis on existing employees comes as HR practitioners are forced to manage their organizations through particularly volatile times, according to Johnny C. Taylor, president and CEO of SHRM. “As organizations continue to navigate talent shortages, economic fluctuations, and evolving workplace dynamics, HR leaders are shifting their focus to long-term workforce development and engagement strategies,” he says.
When it comes to exactly what qualities HR leaders want to encourage among their managers, around 40% of CHROs who named leadership development as a top priority said they were interested in teaching softer skills, like the ability to inspire workers and manage conflict, the second study found.
Out of companies that ranked employee experience as a top concern, 40% said they were focused on improving employee satisfaction, engagement, and productivity, as opposed to other issues like workplace culture (15%), and RTO strategy (5%). And overall, 59% of CHROs are planning to place more focus on employee well-being in 2025, according to the CHRO study.
HR leaders have good reason to worry about their workers. Around 35% reported heavier workloads in 2024 due to unfilled roles, and 61% reported feelings of burnout, according to the state of the workplace study.
“There’s going to be an emphasis on that human-centered leadership in 2025,” says Atkinson. “Leaders need to be equipped to lead change, but also equipped to engage with their employees as well.”
Brit Morse
brit.morse@fortune.com
Around the Table
A round-up of the most important HR headlines.
The U.S. Department of Education is letting go of more than 50% of the workforce, or roughly 1,300 workers across the agency. New York Times
McDonald’s is bringing AI to its restaurants, to help target order accuracy and find equipment issues or failures. Wall Street Journal
Undergraduate students are starting to unionize across multiple campuses, and while the efforts are still rare, when they do pop up they are overwhelmingly popular. Bloomberg
Watercooler
Everything you need to know from Fortune.
Costly workplaces issues. Employee disengagement and burnout resulted in over $5 million in costs annually to the average 1,000-person U.S.-based company, according to a recent study. —Sara Braun
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A plea for clarity. David Solomon said headwinds from tariffs are hampering dealmaking activity, and business chiefs are eager for more clarity on where policy is headed. —Todd Gillespie and Bloomberg
