10 Ways the Business Landscape Will Change in 2025

Organizations saw many changes and challenges come to their workplaces in 2024, forcing them to evolve to meet new talent needs. Those trends will continue to unfold in 2025, requiring organizations to develop additional flexibility and creativity to navigate the disruptions ahead.  

Here are 10 predictions adapted from a recent SHRM ebook about the shifts and opportunities organizations will face in 2025, along with advice on how leaders should respond.

Trump’s Second Term Will Bring New Labor Policies

As Donald Trump begins his second term as president, organizations should expect a regulatory rollback consistent with his approach in his first administration. Efforts may focus on narrowing federal oversight, particularly concerning labor regulations and inclusion and diversity (I&D) initiatives. The White House will likely prioritize flexibility in workplace policies, potentially withdrawing support for the 2024 worker classification rule or slowing enforcement of the recent overtime salary threshold. HR departments must navigate a landscape of decentralized policymaking, ensuring they stay compliant while fostering innovation and inclusivity.

Organizations Will Continue to Struggle with Civility 

Civility will continue to be a key workplace issue in 2025. Organizations must prioritize civility to create healthier workplace cultures. Leaders and HR departments will play critical roles in fostering cultures of respect and helping workers navigate difficult conversations. By setting clear standards of conduct and addressing incivility head-on, they can ultimately improve productivity, employee morale, and organizational success.

Courts Will Remake the Regulatory Landscape

Employers and trade associations may be more willing to challenge regulations in court as unlawful extensions of agency authority, and agencies will likely need to pick their battles more carefully. More aggressive rulemaking, especially when an agency attempts to assert new jurisdiction or extend novel interpretations of the law, may be harder to justify. Employers may have new opportunities to point out in public comment periods those proposals that are newly susceptible to legal challenge. The practical effect for employers may be that rulemaking activity is dampened—but by no means ended—and that the U.S. Supreme Court’s 2024 Loper Bright decision supercharges rulemaking challenges.

The Labor Market Will Soften, But Upskilling Will Be Essential 

Many employers should enjoy comparatively favorable labor market conditions in 2025, even though the overall labor market will likely remain tight by historical standards. To compete for talent in 2025, HR departments must be prepared to invest in training and development programs to equip employees with the skills they need for future roles. This shift will be accompanied by a greater focus on skills-based hiring and training workers on the effective use of AI. While the labor market may be cooling, HR leaders must stay agile and forward-thinking to navigate the massive demographic and technology complexities ahead.

Businesses Will Look to Combine Human Ingenuity with AI

Despite AI’s growing prevalence, business investment in AI technology has not yet reached its peak. While organizations will increasingly adopt AI in the workplace in 2025, they will turn to human ingenuity to make those investments pay off. Although AI will certainly automate away specific work tasks, it will also provide the opportunity to elevate human skills and drive both productivity and creativity. When AI takes care of routine tasks in the workplace, employees can concentrate on the innovation and the interpersonal elements that fuel genuine advancement.

Employee Experience Will Be Increasingly Important 

In 2025, employers are set to deepen their emphasis on employee experience. Technology has a role to play in helping organizations define and enhance employee experience. HR departments should increasingly look to people analytics tools to seamlessly monitor employee experience without worrying about employee survey fatigue. At the same time, they should consider how collaboration tools can enhance team bonding and provide regular reminders of an employee’s connection to the organization’s mission. Leadership will be vital in defining the employee experience and ensuring it aligns with the organization’s values. 

Everyone from executives to people managers can influence whether employees feel valued and fairly treated. HR leaders must also communicate the importance of employee experience to stakeholders across the enterprise. Focusing on employee experience is a transformative approach to positioning organizations to thrive in a competitive marketplace. By embracing this shift, HR leaders can drive sustainable growth and foster a resilient workforce that is prepared to meet future challenges.

Companies Will Rethink Their Approach to I&D

How much organizations invest in I&D programs in 2025 largely depends on the economy. If the economic picture improves, employer-led I&D activity will get a shot in the arm. Internal volunteer action furthering I&D will continue in organizations, thanks to employee resource groups that require minimal budget. Looking further ahead, continued cutbacks in I&D could lead to declining organizational diversity. Managing diversity across dimensions is at a tipping point in the U.S., as the workforce is expected to be increasingly diverse in the years ahead, mandating the importance of understanding I&D in human capital management. Organizations must invest in leading with inclusion now so they’re positioned for long-term success. 

C-Suites Will Evolve to Meet New Challenges

Expect the C-suite to continue evolving with greater emphasis on cross-functional expertise and adaptability. As more organizations recognize the value of diverse perspectives, the trend toward diversified executive teams will gain momentum. More organizations will move away from the idea of a standard set of C-suite roles in favor of greater experimentation. 

At the same time, the roles companies already have will be increasingly collaborative and interdisciplinary. Look for organizations to be increasingly willing to create, eliminate, split up, or combine C-suite roles to meet their evolving needs. The proliferation of new C-suite titles will also require a large pool of talent to be ready for senior leadership roles. HR departments must invest in leadership development to ensure they have the right people in place to move up and take the organization to the next level. As HR becomes an increasingly strategic function, more organizations will start to think about succession planning and talent development as part of business planning.

Flexibility Will Be in Flux 

With some big-name employers set to enforce their return-to-office mandates at the beginning of the year, many other organizations will surely be watching to see how such plans go. Did employees return, or did they quit? Are employees happy or unhappy with the moves? What impact will it have on the organization at large? If companies report success, other firms will likely join the movement. But regardless of what happens with return-to-office mandates, expect more employers to embrace flexibility and innovation in leave programs and other benefits that help employees achieve work/life balance. That creates a win-win for both employers and employees.

HR Will Need to Reach Out to PR

With more channels than ever for people to voice their opinions—and the unpredictable nature of whether those opinions will gain traction on social media—organizations should expect HR-related PR crises to continue in 2025. But HR leaders don’t have to take these situations as a foregone conclusion. Organizations can take action before an HR-PR crisis to limit damage and potentially strengthen their branding. 

This kind of proactive consultation can help cement HR as a valuable strategic partner to the rest of the business. Once formed, these partnerships can be used to create positive narratives and counter negative ones. Creating HR-PR alignment can provide a significant advantage over competitive organizations that aren’t thinking holistically about the intersection of their consumer and employer brands. 

Get additional insights into 2025 with SHRM’s full trends and predictions guide.