For many small and mid-sized businesses (SMBs), the years of the pandemic triggered a reset in their HR operations. Whether it was a move to remote and hybrid workstyles or how they handled payroll, timekeeping, and benefits, the changed circumstances also changed the way companies manage their people.
While the last few years have been somewhat “normal,” most businesses recognize the work environment will never be what it was before. Likewise, the workflow technologies people discovered during the lockdown have changed the way businesses operate forever. 2025 looks to be the year when companies of all shapes and size fully embrace the latest HR technologies to maximize efficiencies while realizing the full value of their people.
In fact, thanks to all-in-one HCM (Human Capital Management) platforms, HR technology is blurring the line between HR department-specific administrative tasks and organization-wide workflows. Here are some of the ways that trend will be most strongly felt:
- AI is enabling HR to better personalize its services and the entire employee experience.
- The growth of gray collar jobs is revealing that virtually all work involves sophisticated use of specialized technologies.
- Training and upskilling continue to demand attention to fill a widespread skills gap and to compete in an increasingly technology-driven business environment.
- The “silvering” of the workforce represents an opportunity to transfer deep knowledge of any particular organization or business into a more tech-centric workplace.
- Workforce analytics is helping SMBs make better informed decisions regarding recruitment, talent development, and employee retention.
Let’s examine each of these areas in more detail.
1. AI-Enabled HR: Freeing People to Be Human
Artificial Intelligence (AI) is the biggest tech buzz in every aspect of life, including the workplace. As a result, AI can mean many different things in different contexts. Per Statista, 22% of U.S. firms with <100 employees and 26% of those with 100 to 499 employees were using AI in their HR department in 2024. HR may be one sector where it causes some of the greatest anxiety.
While many have concerns about computers making decisions regarding their people, AI is already helping HR speed and improve recruitment with capabilities such as resume parsing, candidate scoring, and compensation benchmarking. And everyone would welcome AI’s help in answering employees’ most common questions about benefits or building the most efficient shift scheduling in consideration of workers’ FMLA care responsibilities.
The less time HR spends on routine or functional tasks, the more they can focus on advancing company culture and making contributions to staffing strategies. As the positive contributions of AI become more apparent in the workplace, the enabling technology will be more quickly adopted even in the smallest of organizations.
2. Gray Collar Gigs: HR Tech Becomes the Common Thread
It’s not surprising that terms devised over a half-century ago, like “white collar” and “blue collar,” should be ripe for retirement. “Gray collar” work is labor that requires trained use of sophisticated equipment. That could describe a great many employees in today’s workplace. Figures from the AFL-CIO indicate 44% percent of the total workforce in 2023 was professionals who could be included in this category.
Retail and hospitality are great examples of where the collars are blurring. For example, a retail store manager leverages the same POS and ERP systems the store clerks and the crew in the warehouse use. When it comes to HR, they all may be clocking in and out on the same time-keeping system connected to the same payroll processes. As all-in-one HCM systems become more affordable and easier to use, this will be even more the norm.
Between advances in interoperability and wireless connectivity, HR will have no special need to distinguish between back-office and front-office personnel, much less the color of their collars. 2025 will be the inflexion point for many of these companies.
3. Training & Upskilling: How to Keep the Keepers
As every aspect of the workplace is populated with more sophisticated technologies, workers will need to learn how to use them. In addition to simply knowing how to complete tasks using the new technology, company personnel need to know how those tools get used in their specific company, and how their work product gets shared for review or next steps inside that company’s workflow. A recent report by Gallup shows that less than half of employees (47%) strongly agree they have the skills they need to be exceptional at their current job.
Because this training is ultimately specific to the company, Google and YouTube will no longer be suitable learning platforms for employees to teach themselves how to use the company’s tools. A proper onboarding process that includes technology orientation will become even more of a necessity. And a Learning Management System (LMS) with skills testing and certifications of completion may be the only way for some company systems to be properly used.
These are HR functions which are best delivered via an all-in-one HCM platform. That way, best practices can be standardized, skills attainment can be recorded, and HR never needs to do more than press the “On” button.
4. Older Workers: Silver is the New Gold
One piece of fallout from the pandemic lockdown was “the great resignation,” which brought the exit of many skilled, knowledgeable, and perfectly capable workers. This created a workforce shortage when things opened back up, and it left a wide knowledge gap in every corner of the business landscape, from operational skills to client relations. This landed on top of an increasing lack of skilled workers and qualified job candidates.
According to a recent article in the Harvard Business Review, people who are 65 or older now represent the fastest-growing segment of the labor force—by far. The current multi-generational workforce represents a unique challenge for HR in trying to accommodate varying levels of tech-savviness. So an HCM platform with its UI and UX optimized for ease of use and maximum employee self-service can improve work life for everyone.
Benefits are easier to access. Colleagues are more connected through integrated chat functions. And all the benefits of smarter applicant tracking during recruitment and better onboarding after hire will pay even greater dividends for both the company and these more seasoned jobseekers.
5. Workforce Analytics: Using Data to Drive Decisions
One of the HR advantages SMBs have over larger companies is the potential for closer connections between executive management and staff at every level. “Management by walking around” is a common feature of many successful SMBs. Larger enterprises—mostly out of necessity—are better at seeing the big picture.
HCM platforms can give SMBs this same kind of data-driven overview, with quantitative analytics to back up or add dimension to whatever anecdotes management is hearing from the shop floor or the back of the counter or out in the field. As these tools increase their penetration during the year ahead, leaders will begin to discover this new capability.
While increasing reliance on this data will be one trend in 2025, the more important trend will be the increased efficiency, operational excellence, and employee satisfaction that come from it. This, in turn, will begin to put HR technology at the center of company strategy. And SMBs will begin to leverage their human capital as carefully and boldly as they’ve always done with their finances.
Stay Ahead of the Curve with Namely
Namely has been supporting HR professionals in small and mid-sized businesses for over a decade. Now, it’s a full-fledged all-in-one HCM platform for those same users, streamlining and improving every aspect of the employee experience, from hire to retire.
Be a trend setter in 2025. Discover Namely’s All-in-One HCM Solution for yourself.