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When asked about labour market expectations for the year ahead, 42% of CPOs expect no change, with the remainder split between somewhat weaker or somewhat stronger.
As continued disruption hits global labour markets, many organisations are postponing hiring or restructuring decisions as they assess the evolving landscape, navigate geoeconomic uncertainties and rapid technological advancements.
The World Economic Forum released its Chief People Officers (CPO) Outlook 2025, which collected insights from 130 CPOs at global employers across regions and industries, revealed a dual reality: short-term caution alongside a longer-term imperative for transformation.
The role of a CPO is becoming increasingly strategic, with today's leaders driving organisational resilience, business transformation and workforce readiness. The people function is now widely recognised as a core driver of business growth, with a large majority stating that their company relies on them to actively co-drive and co-design company direction.
When asked about labour market expectations for the year ahead, 42% of CPOs expect no change, with the remainder split between somewhat weaker or somewhat stronger.
In many organisations, the people function is seen as playing a central role in designing and driving this transformation. Yet, while caution defines the present, CPOs stressed the need to invest in longer-term change to navigate continued disruptions and ensure long-term organisational resilience and success.
Talent scarcity and strategic workforce shifts
In a fragmented geopolitical and economic landscape, talent availability and distribution are especially complex. With many countries developing national talent strategies to attract skilled workers or position themselves as talent hubs, global employers are responding by adopting more agile workforce models.
The CPOs surveyed highlighted the importance of skilling and forward-looking talent strategies in this current complex context, and pointed to the potential of global, flexible work models – built on remote or hybrid operations, distributed teams and cross-border collaboration as key levers for strategic advantage. In the East Asia and the Pacific region, in particular, 43% expect the state of talent availability over the next year to be moderate, while a lower figure (36%) expect it to be strong.
New priorities, new tensions
Today’s workers – especially younger generations – are seen to be entering and navigating the labour market with new priorities and expectations, particularly focused on flexibility and purpose.
CPOs surveyed pointed out that shifting workforce expectations as an influential factor shaping talent strategies in mid-2025. While expectations evolve, low vacancy rates in many regions and industries create a talent landscape that is marked by both increased agency and growing precarity.
Besides individual preferences, CPOs observed deeper social and psychological shifts affecting the workplace, citing:
- Rising mental health concerns, and
- Growing value polarisation within the workplace.
With technology perceived to continue to amplify these trends, changing how people work, communicate and connect with organisations, some people leaders are calling for a renewed emphasis on collective values, re-establishing shared purpose and team cohesion.
The report also highlighted two other key factors:
- Talent and technology, and
- People strategy amid disruption.
Talent and technology
Technology remains one of the most transformative trends and despite general optimism, people leaders highlighted several near-term risks for their workforce:
- Employees not adapting or learning quickly enough
- Fears of career stagnation and skill loss due to the over-reliance on AI, and
- Ethical and data privacy issues.
CPOs cautioned that AI-led transformation without adequate support could deepen existing workforce disparities as some workers struggle to adapt risk displacement, and others may face reduced agency or limited career progression as AI takes on more decision-making responsibilities.
Ethical risks – especially around data use in hiring or evaluations – were also raised, with many CPOs emphasising the importance of aligning workforce AI deployment with a long-term vision – grounded in clear business goals and workforce strategies – whilst maintaining a human-centred approach. Failing to do so could lead to missed opportunities for large-scale transformation and erode trust in both leadership and the technology itself.
People strategy amid disruption
When asked which people practices are being prioritised by organisations in mid-2025 for the year ahead, a clear top three emerged among surveyed CPOs:
- Review organisational structure and job design
- Focus on workplace culture and articulating business purpose and impact
- Support workforce deployment of AI and process automation
Reviewing organisational structure and job design ranked highest, with 53% of respondents placing it in their top three and 21% choosing it as their number one priority.
A focus on workplace culture and business purpose came close behind, with over half of respondents listing it as a top three priority, of which CPOs highlighted that workplace culture is often first addressed by evolving leadership models, and empowering the next generation of leaders is seen as crucial for fostering resilience and navigating disruption.
Supporting workforce deployment of AI and process automation was also ranked in the top three by 47% of respondents, reflecting its importance as a transformative force reshaping work.
The report also identified several key required competencies for the people function to deliver on today's priorities:
- Business acumen and strategic thinking,
- Stakeholder influence, and
- Digital fluency and data literacy.
In summary, the report highlighted that geopolitical and economic volatility, rapid technological advances, shifting demographics and evolving worker expectations are reshaping labour markets. Organisations are rethinking their structures, cultures and job design whilst trying to prioritise workforce integration of AI. Although this transition is complex, it presents an opportunity to build a more resilient, inclusive and agile world of work.
WEF affirmed that realising this opportunity will require sustained collaboration, innovation and a shared agenda among all stakeholders. This, it noted, is not just a time for adaptation – it is a time for redesign, and CPOs are increasingly seen as having a critical role to play in shaping and enabling the transitions ahead.
READ MORE: AI adoption higher among men than women: Survey
Infographics / Chief People Officers Outlook September 2025
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