Leaders Identify Top HR and L&D Challenges for 2025

Blanchard’s 2025 HR / L&D Trends Survey looks at some of the ways that leadership, learning, and business professionals are focusing to meet the challenges of ever-changing workplace dynamics. Talent acquisition, retention, and engagement issues combined with new technology and learning methodologies underscore the need for innovative solutions and strategic thinking. 

Our sixth annual survey just closed on November 30. More than 900 people participated in this year’s survey.  Here’s a look at some of the content we will be covering.

Critical Themes for 2025

Every year since its inception six years ago, this Blanchard survey has begun with the open-ended question "What is the biggest challenge you are facing as an HR/L&D leader going into the coming year?"  We provide respondents with an opportunity to elaborate in a more structured question format later in the survey, but we always like to give people an unrestricted opportunity to share first what is top of mind.

For 2025, seven critical themes emerged among the open-ended responses. Here are the issues people indicated they are most concerned about in the coming year.

Challenge #1: Talent Acquisition and Retention

This was overwhelmingly the most common concern. Respondents highlighted these difficulties:

• Attracting qualified candidates
• Retaining skilled and high-performing employees
• Competing for talent in a tight labour market
• Addressing turnover rates and ensuring employee loyalty

Survey respondents identified attracting and retaining talent as their most significant challenge. Responses revealed that finding candidates with the necessary skills, especially in competitive or low-paying markets, remains difficult. This issue is further complicated by what seems to be an increasing lack of interest in managerial roles among some individual contributors, and the ongoing effects of remote and hybrid work models.

To address talent acquisition, organisations might explore employer branding as well as leveraging their culture and benefits to attract candidates. Partnerships with educational institutions and reskilling programs could help bridge skill gaps. For retention, companies could focus on improving employee engagement through clear career paths, competitive compensation, and robust well-being initiatives. The challenge remains: Will these strategies meet the expectations of an evolving workforce?

Challenge #2: Budget Constraints and Resource Limitations

A significant number of respondents mentioned these challenges:

• Insufficient budgets for L&D programs, hiring, and operational needs
• Doing more with less due to cost optimisation pressures
• Balancing ambitious organisational transformation agendas with limited resources

Budgetary limitations were frequently mentioned as a barrier to achieving L&D goals. Many leaders face the challenge of delivering impactful programs with limited resources while justifying the ROI of these initiatives to stakeholders.

To optimise resource use, organisations could prioritise scalable learning solutions such as virtual or hybrid models. Demonstrating ROI through advanced analytics and aligning L&D programs with business outcomes might secure stakeholder buy-in. However, the unanswered question remains: How can HR and L&D leaders effectively demonstrate the long-term value of their initiatives?

Challenge #3: Adapting to Technological Change and AI Integration

Many challenges revolved around these issues:

• Integrating AI into HR and L&D systems
• Upskilling and reskilling employees for emerging technologies
• Balancing human-AI collaboration while addressing fears and resistance
• Keeping up with rapid advancements in technology

AI emerged as a double-edged sword in survey responses. While many professionals recognized AI’s potential to enhance efficiency, there were widespread concerns about its complexity, ethical implications, and integration into existing systems. Some respondents noted that AI might complicate HR functions or create other unforeseen problems.

AI has the ability to revolutionise talent acquisition, performance management, and personalised learning. However, it is critical for businesses to provide clear ethical guidelines, robust training for HR teams, and the development of AI literacy across the organization. The question for next year is: How can organisations balance the opportunities AI provides with the risks it may introduce?

Challenge #4: Leadership Development and Capability Building

These leadership-related issues were raised:

• Developing leaders for future organisational needs
• Enhancing leadership bench strength
• Addressing gaps in leadership skills and accountability
• Supporting leaders in managing change and fostering innovation

Developing leadership bench strength was repeatedly cited as a pressing issue. Many organisations struggle with leadership buy-in for training programs, aligning leadership competencies with future needs, and preparing leaders to manage change effectively.

Leadership development programs may need to emphasise emotional intelligence, adaptability, and resilience. Leveraging AI to assess leadership gaps and tailoring development programs to individual needs could be game-changing. Yet organisations face a core dilemma: How can leadership pipelines remain robust amid fluctuating workforce dynamics?

Challenge #5: Employee Engagement and Organisational Culture

Organisations are grappling with these people and culture challenges:

• Keeping employees motivated and engaged, especially in hybrid and remote settings
• Building a strong learning and development culture
• Enhancing diversity, equity, and inclusion initiatives
• Fostering psychological safety and a sense of belonging

Employee engagement continues to be a pressing issue, particularly in hybrid and remote work environments. Respondents highlighted difficulties with fostering collaboration, maintaining morale, and ensuring psychological safety in dispersed teams.

Organisations could invest in technology to facilitate virtual collaboration and team-building activities while also offering flexible work policies and well-being programs. Transparent communication and recognition initiatives could help sustain morale. The critical question persists: How can engagement strategies be adapted to the complexities of hybrid work?

Challenge #6: Change Management and Resilience

Respondents frequently stated these concerns:

• Managing organisational change effectively
• Developing resilience among employees and leaders
• Aligning L&D efforts with strategic priorities during transformation periods
• Handling resistance to change from both employees and leaders

Change management emerged as a significant challenge, particularly as organisations adapt to technological shifts and economic uncertainties. Respondents highlighted the difficulty of balancing short-term demands with long-term strategic goals while maintaining employee resilience.

Equipping leaders with change management skills and creating transparent communication channels may ease transitions. Implementing phased change initiatives with measurable milestones could build confidence among teams. Yet the lingering question is: How can organisations ensure employees remain motivated and aligned during periods of transformation?

Challenge #7: Skills Development and Workforce Readiness

Challenges focused on these topics:

• Addressing skill gaps in technical, functional, and behavioural areas
• Providing consistent upskilling and reskilling opportunities
• Aligning training programs with future workforce needs
• Preparing employees for a rapidly evolving work environment

Many respondents emphasised the need for upskilling and reskilling employees to meet the demands of technological advancements (including AI) and evolving business needs. The challenge lies in aligning these efforts with both organisational goals and individual career aspirations.

Leveraging AI-driven learning platforms could help identify skill gaps and personalise development pathways. Encouraging a culture of continuous learning and providing on-the-job training opportunities may also prove effective. However, organisations must ask: How can we prioritise reskilling efforts while balancing immediate business demands?

Looking Ahead: A Webinar That Provides Answers

These responses reflect the current complexity of HR and L&D challenges as organisations work to address talent retention, financial constraints, and technological advancements while building leadership and managing organisational change. Efforts to improve employee engagement and address skill gaps are critical as organisations strive to maintain their competitiveness in a changing global landscape.