To no one’s surprise, artificial intelligence will continue to dominate HR in 2024. But new SAP research indicates other HR trends that might be more surprising: that diversity, equity, inclusion, and belonging (DEI&B) efforts could stall out in some organizations, and that trust in leadership takes a nosedive. Compensation issues may come to a head, too. Organizations will need to deal with the realities associated with technological advancements, major demographic changes, and changing expectations related to the employee experience.

The SAP SuccessFactors Growth and Insights Team conducted extensive research to understand the top HR trends facing organizations today. For 2024, we analyzed 100 reputable business press resources to generate a list of 611 potential trends. Through content analysis and the use of AI tools, we consolidated these trends into nine broader meta trends captured in our annual HR trends report.

Employee experience (EX) does not exist in our list as a meta trend, though, because it is important to consider EX more broadly. The biggest issues that organizations and HR teams will face in 2024 are tightly woven into the employee experience, so EX will be a top priority for organizations and HR teams as they plan to address these challenges.

Understanding these trends and the role that technology—including AI tools—can play in addressing them is essential for HR professionals and business leaders to make strategic decisions. These are the top trends that we’ve identified as most important for the coming year.

1. AI upends the world of work as we know it.

AI dominated the 2024 trends discourse: how it will transform the labor market, how it will drive productivity, and how it will need to be managed to prevent negative outcomes. Generative AI won’t lead to widespread job losses, but people who use it will replace those who don’t. Employees will need to see AI as a tool to help them complete work, not a force to compete with, but that may be a tough sell for some.

So then the question arises, how do you prepare people managers to manage the performance of employees who use AI? How do managers incorporate AI into their team members’ performance and development goals? And how do managers determine what level of AI usage is appropriate? Guardrails and guidance are crucial.

2. Skills become the center of HR practices.

Organizations will be forced to consider what AI skills they need, to identify who (internally or externally) possesses those skills, and to determine how they should best fill identified skill gaps, be it through reskilling/upskilling, redeployment, external sourcing, or leveraging contract workers. Ironically, human skills such as strategic thinking and complex problem solving will become increasingly important.

A focus on career development and continuous learning will help employees and their employers rise to the AI challenge. Employees’ expectations for personalized career paths have increased considerably, and microlearning will help them improve their skills and adapt to changing business needs. Reskilling and upskilling initiatives, especially for urgent skills needs like AI, will lead to increased motivation in employees, so it must also see greater prioritization by organizations.

3. Workers return to the office.

Organizations will continue to experiment with motivating employees to return to the office in ways that promote productivity, collaboration, and cost savings, but don’t alienate their top talent. With the recent increase in partial and full return-to-office (RTO) policies, 2024 trends data suggests that the pendulum has swung back to hybrid.

Data suggests that organizations will take one of two motivational approaches to returning to on-site workplaces in 2024—incentivizing employees to visit the office with commute-worthy experiences or penalizing employees and/or their managers for not complying with RTO mandates. In this period of rethinking and redesigning hybrid and remote work models, trends indicate that organizations in 2024 will reconsider their culture: what it is, what they want it to be, and how to best sustain it.

4. DEI&B momentum stalls.

Organizations that lack executive-level advocacy and dedicated DEI&B resources are likely to deprioritize or even defund their DEI&B efforts this year, in part due to some employees’ discontentment with these initiatives, but also due to changing legal landscapes.

However, demographic, legal, and economic shifts make 2024 the year to lean in to DEI&B, not shy away from it. An aging workforce and limits on immigration are contributing to a global talent and skills shortage, which forces organizations to rethink how they find talent, and to recognize where bias and exclusion exist in their recruiting and selection practices. Another reason DEI&B will be crucial in 2024 is that the workforce spans more generations than ever before, and the increase in generational diversity requires effective DEI&B management to ensure employee and business success.

5. Mental health reaches a breaking point.

As rates of employee stress and burnout increase to all-time highs, this year’s trends make it clear that mental health will need to be a specific and dedicated focus of organizations’ well-being efforts in 2024. Being on the receiving end of countless organizational restructurings, leadership transitions, and technology changes over the past several years have left many employees in a state of total change fatigue.

Meanwhile, another crucial focus of employers’ well-being efforts will be financial well-being. The link between financial wellness and mental health isn’t difficult to draw; finances are continually reported by employees as a top contributor to their stress.

6. Trust in leadership plummets to new lows.

The change-induced stress, burnout, and disconnection that workers are experiencing will require organizations to focus on building a trusting, communicative relationship between employees and their leadership, but the current work climate of instability, prompted by a broader business environment of layoffs, the advent of workplace AI, macroeconomic uncertainty, global conflict, and the likelihood of upcoming political upheaval, has created a strong sense of job insecurity for many workers. This puts leaders in a tough position.

The current dearth of leadership trust may leave employees feeling less valued and less connected to the larger mission of their organization than in previous years. If employees’ search for meaning is not fulfilled, they may consider looking at other job opportunities where those needs can be met.

7. HR transforms its own skills and agility.

HR will undergo its own skills transformation in a few key areas. AI is at the top of the list, of course, but public relations skills are a new necessity in 2024. In a world where RTO mandates and layoffs have become major news headlines, and live reactions to being fired have even gone viral on social media, HR must anticipate this level of exposure and be prepared to address it both internally and externally.

Intelligent technologies have long been a part of HR’s toolbox, but with the explosion of generative AI capabilities and access in 2023, there are a wealth of opportunities for HR professionals at all levels to improve the quality and efficiency of their work in 2024.

8. Pay gets put in the spotlight.

Several factors have converged over the past year to make pay top of mind for both employees and employers, including continued economic uncertainty, organizational restructuring and layoffs, increased costs of living, and elevated inflation and interest rates. The 2024 trends point to several other employee-driven forces elevating the compensation topic, including changing work arrangements and growing expectations for fair pay.

On the one hand, employees expect organizations to provide compensation and benefits to address their logistic concerns (for example, to deal with transportation costs associated with returning to the office). On the other, experts have considered wage growth in recent years to be unsustainable. The prediction is for a notable decline in total compensation this year as some organizations attempt to rebalance their compensation costs. What shows no signs of slowing down, though, are calls for pay equity and pay transparency.

9. Sustainability becomes a strategy.

Sustainability will move beyond compliance and be treated as an important element of employer brand and internal strategy execution. HR will be expected to weave eco-friendly practices into HR policies, to provide employees with training to understand the organization’s sustainability goals, and to implement new technologies or practices that will replace less efficient alternatives.

Organizations will need to tread carefully as they emphasize environmental sustainability as a key strategic priority while simultaneously enforcing RTO mandates that could be perceived as having negative environmental effects. Addressing the topic openly and transparently will serve organizations well.

More about the top 2024 HR trends

For a more in-depth reading of this year’s HR trends, read the complete report , 2024 HR Trends: The Year of AI (free registration required). In addition to a complete analysis of each trend and our perspective, we pose questions for HR and business professionals to consider, and we provide resources to help deal with the important issues now. For an overview of the research, watch the 2024 HR Trends video from Dr. Katherine Gibbard, Research Scientist, or check out the infographic.