State of the Workplace 2026 | Emerging Challenges

Today, HR and business leaders are navigating increasingly complex challenges that require organisations to operate with agility, have strategic foresight, and build on human-centric leadership.  The latest edition of SHRM’s State of the Workplace report provides an in-depth insight into the most pressing organizational needs, the degree of alignment between workers and employers, and the strategies necessary to drive relevant change.

Research Approach

Drawing on insights from over 2,000 U.S. based workers and more than 1,800 HR professionals, including more than 350 in a CXO role, this research, conducted between Oct and Nov 2025, provides a snapshot of the current state of the workplace, offering valuable insights to inform and shape organisational strategies for 2026 and beyond.

Emerging Worker & Workplace Challenges

1. Elevated Worker Expectations vs. Organizational Response

A large majority of HR professionals recognize that workers now have higher expectations from employers, creating a gap between employee needs and organisational performance. Workers’ expectations around career, experience, and workplace support are reshaping priorities for HR and business leaders. This is reflected in the 2026 State of the Workplace report where 72% of HR professionals report that workers today have higher expectations of employers, underscoring the scale of demand for improved workplace conditions. This is a significant point to note, even though 89% of workers said they believe their department cares about addressing workplace needs. 

2. Stress, Burnout & Employee Experience Pressures

Stress and burnout are among the most pressing issues facing the workplace. Employee experience (including well-being and engagement) is highlighted as a top priority for both workers and HR. These pressures contribute to disengagement and higher turnover risk if not properly addressed. Even though employee compensation emerged as a top workforce need, it was observed that across the talent spectrum (15% of workers, 19% of HR professionals, and 19% of HR executives), employees identified stress and burnout as among the most important for their organizations to address.

3. Misalignment Between Supportive and Unsupportive Employers

The SHRM 2026 State of the Workplace research points to a growing gap between organisations that effectively support workers and those that don’t.  Employees who perceived their organisations as ineffective in addressing their workforce needs have a lower satisfaction level (only 44% are satisfied) and much higher turnover intentions (51% indicated they are somewhat likely to leave), signaling that workplace support (culture, development, leadership) is now a competitive differentiator.  This gap is clearly visible with more than three-quarters of workers who said they view their organization as effective or very effective at addressing needs (77%) indicated it is at least somewhat unlikely they will leave, including 62% who reported it is unlikely or very unlikely.

4. HR Function Workload and Staffing Gaps

To add to the above, it has become evident that there is a lot that can be done to better equip the HR function to meet the challenges stated. But with changing times and increasing workplace responsibilities, it was observed that 58% of HR reported working beyond their limits, a figure that has remained consistent with results from 2023 and 2024. Additionally, 55% of HR professionals and executives agreed that their teams have been operating with insufficient staff.

Given the above challenges, it is evident that there is a shift in approach and support required at organisations for workers and HR professionals.  Workers have called out employee experience, total rewards, and learning and development as focus areas for HR in 2026. While HR professionals have acknowledged this, they know they must first address eroding employee trust, reposition themselves as strategic business partners, and develop proactive engagement strategies.

To deep dive into the undercurrent of the challenges stated above, you can view the full report as a member.