Fosway: HR is entering a more ‘cost-conscious age’, it’s time to embrace AI innovation
That’s according to the 2024 HR Realities research from Fosway, Europe’s number one HR analyst, in partnership with UNLEASH. Let’s take a look under the hood of economic headwinds, and how HR can level up to improve employee experience and their strategic positioning in 2025.
Expert Insight
Europe's leading HR analyst Fosway has published its HR Realities report for 2024.
UNLEASH has partnered with Fosway on HR Realities for ten years, and has done the same for the 2024 data.
Here's everything HR leaders need to know to cut through the hype in 2025, featuring comments from Fosway's Chief Insights Officer and UNLEASH's Founder & CEO.
Three in four HR leaders are facing economic headwinds in 2025, and they are feeling the pinch with their HR budgets.
Headcounts are flatlining, there’s strain on HR tech spend as businesses enter “a more cost-conscious age”, and even investment into HR’s own expertise and skills is struggling in this challenging economic environment.
That’s according to Fosway Group’s 2024 iteration of its HR Realities research.
UNLEASH has partnered with Europe’s leading HR analyst firm on the HR Realities report for the past decade, and this year is no different.
The report stated: “In the face of economic headwinds, delivering value is more at the forefront of HR thinking than it has been for the past decade”.
Credit: HR Realities 2024.
This explains why 62% HR leaders told Fosway that organizational performance and profitability is was their main challenge in 2025. This puts performance and profitability only just behind the top challenge overall: Availability of skills at 63%.
“Every function lives and dies by its ability to impact the bottom line and HR is increasingly under scrutiny to show its value-add”, shared the report.
This begs the question, where should HR focus their limited resources in 2025?
EX and AI must be top of HR’s to-do list in 2025
The aim of Fosway’s HR Realities research is about really holding up a mirror to HR to help them cut through the hype.
David Perring, Chief Insights Officer at Fosway, tells UNLEASH that HR Realities and the partnership with UNLEASH is “a catalyst for conversations, that an internally only focused HR team wouldn’t otherwise be able to have without any solid foundation of what’s really going on”.
HR Realities is all about “really understanding the trends, what’s working and where HR should be focusing to outperform – not just in their organization, but across industry”.
This year’s data shows what HR leaders need to prioritize to thrive in 2025.
Credit: HR Realities 2024.
While getting employee experience right is crucial for HR’s future success, Fosway’s research found that less than half (44%) of HR leaders think the employee experience they provide is good.
Part of the issue is the tech stack. 68% of HR leaders don’t think their current tech stack is able to support a high quality employee experience that would make their organization an employer of choice.
AI is on hand to help here, with improving employee experience being a top driver of AI adoption.
68% of HR leaders talked about AI’s positive role in employee experience, while 88% talked about AI creating greater operational efficiency and productivity, 78% think AI could speed up processes, and 59% believe that AI could support more intelligence decision making.
Fosway’s report stated: “Everything points to a growing momentum behind AI in HR” – 79% of HR leaders are planning to expand the use of AI in their HR processes, and just 5% have no plans to increase their AI usage.
Credit: HR Realities 2024.
It is clear that “the future of HR lies in becoming a people and workforce intelligence function” with strategic influence on the business.
For Marc Coleman, Founder & CEO of UNLEASH, “this year’s findings reveal a fascinating dichotomy: While AI is already reshaping HR functions, its true potential to transform the employee experience remains untapped.
“The road ahead is both exciting and challenging, with nearly half of HR professionals predicting that substantial automation could redefine our roles by 2030 – the reality is it will happen much sooner.
“Equally striking is the persistent gap in employee experience, with only a third of HR systems truly supporting the organizational goals we aspire to.
These insights are a call to action for HR leaders to embrace innovation and close the gap between ambition (dreams) and reality.”
Coleman continues: “We invite HR leaders to join next year’s survey to help shape the future of work together and drive real progress.”
Want to dig even further into the HR Realities 2024 findings? Check out this recent video interview UNLEASH did with Fosway CEO and Founder David Wilson.
