Caution Is Defining HR’s Next Era: November 2025 EN:Insights Forum

HR executives are reporting a cooling labor market, restrained economic sentiment, and a workforce whose expectations continue to rise even as organizations pull back. This was reflected in SHRM’s Q4 2025 CHRO Outlook research, which surveyed 262 U.S.-based HR executives, including senior HR executives at the vice president level and above. 

The November 2025 EN:Insights Forum analyzed this data through a presentation by Ragan Decker, SHRM-CP, manager of Executive Network and enterprise research at SHRM, and Lisa Brown, executive vice president and chief people officer at Primerica, a financial services company for families. Together, the story they painted is clear: 2026 will be about cautious recalibration due to volatile markets, trade tensions, and unpredictable federal policies. 

Research Insight No. 1: CHROs expect turbulence — not collapse — as “fair but fragile” becomes the norm. 

Economic sentiment in 2025 has been defined by its swings. After a severe drop in positive sentiment in Q2, perceptions of economic conditions returned to typical levels in Q3 — but Q4 brought a renewed tilt toward pessimism. 

“Since April, HR executives’ ratings have continued to fluctuate, reflecting a turbulent economic climate throughout 2025,” Decker said. 

HR executives’ economic ratings for Q4 2025:

• 54% said conditions are fair.

• 26% rated them as poor (23%) or very poor (3%).

• Only 21% viewed them as good or excellent.

Positive ratings (good or excellent) dropped 8 percentage points from Q3, and negative ratings (poor or very poor) rose 5 percentage points, signaling a clear shift back toward caution.

Six-month expectations show similar ambivalence:

• 40% expect conditions to be fair.

• 37% expect them to be poor or very poor (up 4 percentage points from Q3).

• 23% expect them to be good or excellent (down 6 percentage points from Q3).

Brown explained that the current environment is one in which leaders must constantly bob and weave in recognition that policy uncertainty, inflation, and market volatility are now persistent features of workforce planning. The focus is shifting from long-term forecasts to quarter-by-quarter scenario planning.

Research Insight No. 2: The labor market is cooling unevenly and, sometimes, sharply.

Employment assessments in Q4 2025 reached their most negative point since tracking began in 2022.

HR executives’ employment condition ratings in Q4:

• 49% rated conditions as fair.

• 30% said they are good or excellent.

• 22% reported them to be poor or very poor (a record high, tied with Q4 2022).

The majority of HR leaders surveyed still chose “fair,” but the share that rated conditions as good or excellent fell 5 percentage points from last quarter, while the poor or very poor rating climbed 8 percentage points — a dramatic quarterly shift.

With a negative assessment of current conditions, leaders forecasted modest negative shifts in employment conditions for the next six-month period.

• 49% expect employment to be fair.

• 27% expect it to be good or excellent.

• 24% expect poor or very poor employment conditions.

Brown noted that this moment requires organizations and workers to pivot together. Many roles aren’t hard to fill because talent is scarce, but because skills, expectations, and job demands are increasingly misaligned.

Research Insight No. 3: Hiring difficulty is easing and retention difficulty is stable, yet both remain challening.

Hiring conditions show another paradox: The labor market is softening, but mismatches continue to make recruiting and retaining talent difficult.

Brown described a trifecta of factors shaping these recruitment and retainment challenges:

1. Workers’ expectations for flexibility and lifestyle fit continue to climb.

2. Job demands are increasing — companies are asking employees to work at a faster pace, work more creatively, and operate with constant change.

3. Immigration uncertainty and the rising cost of specialized talent is straining employment pipelines.

Compounding this, many early-career workers lack in-person workplace experience, making onboarding, mentoring, and manager readiness more important than ever.

Research Insight No. 4: Skills, culture, and human connection will set organizations apart in 2026.

Despite the hype surrounding AI, HR executives’ productivity expectations remain modest.

• 39% said they expect productivity to rise (up 4 percentage points).

• Only 37% said they expect revenue-per-employee to grow.

These subdued numbers show that even with rising AI adoption, leaders do not foresee dramatic near-term productivity gains.

“Despite significant investment and attention on AI, HR executives’ expectations for increases in productivity and revenue per employee have remained relatively stable over the past two years,” Decker said. 

“Many AI implementations aren’t as successful as people expect, because without the right planning and knowledge transfer, the technology can fail,” Brown said. “You still need human talent to guide the process, prevent bias, and make sure teams understand how to use these new tools.”

The organizational differentiators that Brown foresees for 2026 are:

• Versatility (“utility players” who can flex across roles).

• Continual learning mindsets.

• Intentional culture and leadership behaviors.

• Human connection in hybrid environments, which she warned is critical to preventing silent disengagement.

According to the Q4 2025 CHRO Employment Outlook data, engagement expectations reflect this concern:

• Only 28% of HR executives said they expect employee net promoter score (eNPS) or engagement to increase.

• 50% said they expect no change.

Strong culture and leadership remain the most reliable levers for retention and performance. 

In an environment where uncertainty is guaranteed, the differentiator won’t be economic luck or the newest tools. It will be how well leaders engage, develop, and bring people together for collaboration and how effectively organizations adapt to an era defined by volatility and accelerating workforce expectations.