5 predictions for HR and the world of work in 2025

Reflecting on 2024, it’s clear that the world of work is changing. Hybrid work models saw further evolution while generative AI brought levels of disruption that mimicked the tech boom of the 2010s.

It also seemed that not a week went by in 2024 where we didn’t hear about yet another company undergoing a mass layoff and similarly, DEI took repeated hits across industries and regions. Employee tensions have bubbled up as a result, evidenced by WorkTok trends like “act your wage,” which received increasing media attention.

At Culture Amp, we’ve tapped into our data lake of over 1.3 billion data points to make sense of it all and look ahead to 2025.

In 2025, reinvention will be key to survival.

With all the innovation that Generative AI brings to businesses, products, and work life, companies that can’t or won't adapt to it risk losing their relevance and, ultimately, their success. We’re expecting major pivots, experimentation in thinking and process, and adaptation in 2025 because these will all be necessities for survival.

Given how closely tied company success is with employee performance, we focused our first prediction there. What might performance management look like in 2025? What does 2024 data tell us about the state of performance in the new year?

Prediction 1: Performance measurement shifts from "me" to "we"

According to our data, only 11% of employees are rated as a high performer once over three years. That number drastically drops to 2% for those receiving a high performance rating two cycles in a row. Of course, this means that the strong majority of employees (83%) never see a high performance rating across their three years of tenure.

High performance, as we know it, isn’t sustainable

This reality may seem harsh to employees who spend a considerable amount of their lifetime at work. It could also help to explain why a large percentage of employees don’t believe the performance process is fair.

We turned to our data lake and, in looking at the regions where most of our customers are based, we found that 75% or fewer employees think they’re evaluated fairly through the performance evaluation process.

Ruh-roh. Our research team struggled with how to present these insights because they deposition performance management as inherently focused on the individual. Organizations are scrambling to define and create a high-performance culture. But this tends to historically hinge on individual high performance which, as it turns out, is really, really difficult to achieve.

As companies tried to build high-performance cultures in 2024, many found that traditional methods simply didn’t work. Take Meta, for example. Their controversial move in 2023 to implement forced ranking made headlines and sparked debate about the psychological effect of receiving a low performance rating.

The result was continued layoffs at all leadership levels at Meta in 2024. If we know that high performance isn’t sustainable in its current form and that companies are using it more as a tool to push employees out than to reward excellent work, the conclusion is clear: it’s time to adapt.

Shifting individual performance to the context of the team

One adaptation we’ll see in 2025 is a broadening of performance measurement toward the team level.

This doesn’t mean performance evaluation at the individual level is a dying practice, but rather that individual ratings will be contextualized through the lens of the team. As our CPO, Justin Angsuwat, recently reminded HR practitioners, even star athletes – undeniable top performers – need rest. They can’t always lead from the front of the peloton; sometimes they need to ride the smoother air left by their teammates.

Humans are not built to operate at full capacity all the time, and that’s okay. By reframing individual performance within the team context, leaders can strategically plan rotations, ensuring that different employees take the lead at different times, ultimately driving collective success.

Of course, rethinking performance management is a big piece of the puzzle, but it isn’t the only important one going into 2025. The reality is that even with innovative strategies, the tension between employees and employers isn’t going anywhere. As companies double down on their goals to create a high-performance culture, employees are increasingly asking, “What’s in it for me?”

Prediction 2: The employee-employer standoff continues

2024 was filled with enough work-related neologisms to last a lifetime. We’ve heard about quiet-quitting, quiet-vacationing, quiet-managing, conscious un-bossing, hushed-hybrid, lazy girl job, coffee badging, and bare minimum Monday – just to name a few. While we could easily dismiss some of these terms, they aren’t entirely unfounded.

According to our data, employee motivation and wellbeing remain at troublingly low levels, signaling some truth to the idea that employees are restricting the amount of energy they give to work.

About one in every two employees don't agree with the statement: “I rarely feel overstressed at work.” Plus, since 2020, our data shows a 6% point decrease in employees agreeing that their workplaces prioritize employee wellbeing.

We also see signals in the qualitative data of employees becoming more displeased at work. When we looked at all employee comments (~75 million) left on surveys from 2016 to 2024, we found that the sentiment of those comments has seen a big shift. Where before and during the pandemic most comments were neutral in tone, since 2023, neutrality has taken a back seat to negativity.

Clearly, employees are using surveys to express their discontent more than they were just a few years ago. And organizations are struggling to adapt. Faced with layoffs, re-orgs, and shrinking budgets, many workplaces are being forced to do more with less. These are often necessary changes in today's market, but they come at a cost: employees are being asked for more without commensurate adjustment to compensation, reward, or recognition.

Now, it could be assumed that employers aren’t willing to meet employee needs, but often they’re just as constrained by competing demands. Adam Gunn, VP of Brand at Fullstory reminds us that the standoff extends to the boardroom. He said,

“Boards can focus on broad industry benchmarks as measures that may or may not apply to your specific growth strategy or phase, and it’s those expectations that are forcing teams to not backfill, turn to contract workers, delay promotions, or lose needed resources. The need is real, and so are the consequences.”

Neither employee nor employer are in a strong position

In a tight labor market, employers risk alienating their top performers – the very employees who are most capable of finding opportunities elsewhere. On the employee side, the pullback in effort may foster collective identity in spaces like WorkTok, but divesting from work can also hinder long-term career prospects, especially if employees decide to prioritize career later.

If there is to be compromise in 2025, we predict it will be in the form of increasing contract roles and job crafting.

As companies grapple with reduced budgets and employees no longer use work as a primary source of identity, leaders need to lean into creating more part-time or contract positions. These roles may offer a way to renegotiate what work looks like, providing flexibility for employees and cost-efficiency for organizations. That said, we don’t expect these changes to gain significant momentum until later in 2025.

As the standoff continues, leaders will need to pivot and adapt. They will have to determine which employee expectations they can, want, and ought to meet – and which they are willing to leave unmet.

Prediction 3: Do-it-all leadership goes out of fashion

The last few years have placed extraordinary demands on leaders. During the pandemic, many stepped up to meet their employee’s needs in a way we hadn’t seen before, and it showed in their employee’s experience data. From 2019 to 2020, we saw employee perception of leaders jump up and then peak in 2021. However, since then, perception has continued to decline year over year. What’s going on?

Leaders, like employees, have had to navigate constant workplace change while balancing high expectations. We wondered if maybe leaders were burning out from going above and beyond during the pandemic. But we didn’t find evidence to support that idea.

In fact, when we compared the overall work experience (all survey questions averaged together) between leaders and employees, we found that the higher the leadership level, the more favorable the experience.

Leaders’ elevated experience could be driven by greater access to resources, autonomy, or support – advantages that their employees may not share. While these positives reflect the benefits of strong leadership, they may also unintentionally distance leaders from their teams’ challenges. Women leaders, possibly more attuned to team dynamics, stand as a partial exception, but the broader gap remains.

Leadership is central to employee engagement

Confidence in leaders has been steadily declining, yet its influence as a driver of employee engagement remains strong.

For leaders who feel pressured to meet every expectation, this creates a near-impossible standard – one that cannot be sustained.

So, what is the path forward? Sustainable leadership isn’t about doing less, but rather about focusing on what matters most. Leaders need to co-create priorities with their teams, using employee experience data to align their efforts with organizational goals.

But prioritizing is no small feat. With endless streams of data competing for attention, leaders face a critical challenge: how do they decide what matters most in a world of information overload?

Prediction 4: Decision intelligence takes center stage

A Chief Technology Officer at a U.S.-based cable manufacturing company shared that in a typical week, he gets about 50 ad-hoc messages that contain data from across the company alongside some kind of ask. That’s 10 per day, each demanding attention and action. He also shared that managing the sheer volume of decision-requests is among the top most challenging aspects of his role as an executive. We suspect that he isn’t alone.

In 2024, many companies experimented with Gen AI out of curiosity. But in 2025, Gen AI will become a necessity for leaders, especially in decision-making. With the pressure to make smarter, faster decisions mounting, companies will increasingly rely on AI to parse through the overwhelming amount of information and pinpoint actionable insights.

Employees aren’t thrilled with decision-making – even when they’re involved

Our benchmark data showed that, globally, employees aren’t stoked about how decision-making is happening where they work.

In fact, nearly every other employee isn't convinced. Adding another layer, two out of five employees do not agree that their company is effectively directing resources toward its goals. If you’re wondering if employees are dissatisfied because they feel excluded from the process, we thought that too. But actually, 72% of employees globally agree that they are appropriately involved in decisions at work.

Conundrum, right? What’s happening with that gap? Are employees judging decisions they are themselves involved in as ineffective? What is going awry in the process?

Perhaps with all the various streams of data being thrown at leaders, employees aren’t convinced that leaders are looking at the right data at the right time – maybe they’re even sending it to them and feeling ignored.

Employees will be more satisfied with decision-making when their data is seen, digested, and used

The integration of Gen AI into decision-making may help bridge the gap between employee involvement and satisfaction. If employees know their data was analyzed objectively alongside insights from across the organization, they may feel less frustrated when their input isn’t directly reflected in decisions. AI could make the process feel more impartial, reducing emotional friction and fostering more agreement in the outcomes.

Using Gen AI for decision-making will come to be seen as a signal of agility, even assisting with rebuilding trust and a shared sense of direction across the organization. When leaders can move beyond involving employees in decision-making for the sake of involvement and ensure that decisions reflect a cohesive strategy backed by the right data, companies will see much more success.

However, using generative AI for decision-making may not be easy

Clean, safe, and unbiased data is critical since feeding AI “bad” data could compound poor decision-making. Add to this the growing security risks and environmental impact of running AI tools and we see a whole new set of problems that need to be considered. Gen AI’s energy demands raise tough questions about ESG as it takes over tasks once handled mentally by humans – tasks with little to no ecological cost.

The companies that thrive in 2025 will be those that figure out how to clean their data, secure their systems, and use AI responsibly. For others, incorporating Gen AI could become a burden instead of the competitive edge they’re hoping for. Careful consideration is definitely needed.

That said, we expect that decision-making is just a small aspect of future AI use. In 2025, Gen AI will go beyond just leadership decisions and transform the internal systems and workflows that power organizations. The way employees work is about to change dramatically.

Prediction 5: Internal processes get an AI makeover

Everyone has had a hard time locating a critical piece of information, only to find something somewhat related, hours later, that still isn’t the file needed.

This is an everyday reality for swaths of employees and thus, no wonder that only 64% of employees believe their company’s systems and processes support them getting their work done effectively. In 2025, some companies might actually see that number change.

For years, systems and processes have been a low-scoring factor without improvement while also showing up as a strong driver of engagement (for the data nerds out there: 0.56 is the correlation coefficient(r)).

Comment data surprisingly surfaced a relevant and revealing insight that helps paint a more hopeful picture. C-suite leaders are deeply and uniquely concerned about systems and processes, far more than employees at other levels. We’re taking this as a sign that leadership is already prioritizing these areas and may even be considering investing in them.

It seems, then, that employees and leaders are collectively facing the challenges of internal knowledge diaspora within and across their companies.

Gen AI adoption is in its second wave

While many employees already use LLM tools independently to streamline their personal workflows (perhaps secretly), organizations will begin introducing AI tools designed for intentional internal use. Unlike public-facing models that train on every input you feed it and risk security of proprietary information, internal Gen AI models are designed specifically for ensuring data privacy.

When used right, Gen AI tools can dramatically improve workflows, eliminate inefficiencies, and make information available in seconds. In 2024, some Culture Amp employees gained early access to an internal Gen AI tool. They now show higher engagement levels and report having more energy at work than employees who weren’t in the pilot cohort. We’re only one company, but we can’t help but share our own experimentation with people solutions and strategies. We’re excited about the possibilities!

Our own Chief People Officer, Justin Angsuwat sees AI as key for the entire HR profession. He says,

“AI will do two major things. First, it will help HR teams automate tasks in a way that we haven’t seen before, so they can focus on higher-order work. And second, it will give HR teams and leaders organizational insights at a depth and scale we haven’t seen before, for example: pointing to which sales pods are most likely to hit (or miss) their sales quota. What AI does well, is connecting the dots between disparate pieces of information. So the next generation of HR needs to be focused on deciding what insights they want AI to surface, and then knowing how to act on those insights.”

If internal Gen AI can actually turn daily frustrations into seamless experiences, unlock productivity, and boost engagement, then perhaps the workplaces that use them will have the wow factor top performers look for when job hunting. Companies that implement these tools strategically could see employee favorability rise, especially around long-standing pain points like systems and processes.

Not all make-overs are glamorous

Of course, change comes with growing pains. Some organizations will struggle to adapt, facing resistance or technical challenges. But for companies that lean into these transformations, the potential to turn their weakest areas into a competitive strength is enormous.

People Analytics Manager at GoodRx, Smaran Mandala, shares how intentionality will help companies succeed with gen AI tools:

“It's important to have a structured review process in-house, especially when implementing AI within the HR domain. Be curious, vet every feature, and work with the AI vendor to understand the possibilities but also the limitations.”

Regardless of how it is implemented, in 2025, Gen AI won’t just fix broken systems – it will redefine how work gets done. For organizations ready to embrace the change, 2025 could be the year they turn one of their biggest weaknesses into a lasting strength.

Closing thoughts

As we look ahead to 2025, one thing is clear: agility, resilience, and reinvention will define success in the future of work. Organizations that embrace experimentation, rethink priorities, and approach AI integration strategically – and with their people in mind – will be the ones to lead the charge.

Here’s what we hope for the year ahead:

• Our optimistic predictions aren’t just forecasts – they’re aspirations. We believe work can be better, and these shifts are opportunities to create environments where people and organizations thrive.
• Our goal has always been to create a better world of work, and these predictions align with that purpose. We’re excited to help companies prepare for these changes and thrive in the years ahead.

Want to learn more? Check out these resources to explore how your organization can lead the way into the future of work:

• Tips for setting goals for agile teams
• Tips for effective performance management
• AI at Culture Amp
• AI in People Analytics