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The Hackett Group's study indicates that 66% of HR teams have adopted generative AI; however, expanding its use is crucial for transforming service delivery, enhancing productivity, and boosting competitiveness.
Hackett Group has reported increased AI adoption in HR amid productivity challenges. (Photo: CrizzyStudio/ Shutterstock)
A new study by The Hackett Group found that 66% of HR departments are currently leveraging generative AI (Gen AI) to improve human capital management. Despite this, the 2025 Key Issues Study revealed that HR workloads are projected to increase by 10% in 2025, while budgets are expected to decrease by 1.5% and headcounts by 2%, resulting in a 12% productivity gap. AI-driven automation is identified as essential to bridging this gap.
“Gen AI is not merely an option, it’s a strategic imperative for HR leaders looking to reimagine work and drive breakthrough business results,” said The Hackett Group principal, global human resources executive advisory practice leader Jessica Haley. “Our research shows that by embracing AI, HR can transform service delivery and unlock significant competitive advantages.”
Gen AI to play crucial role in talent acquisition and communication
The study indicates that HR teams plan to expand Gen AI adoption beyond initial trials. Key areas for Gen AI growth in 2025 include talent acquisition, where 52% of organisations use AI for writing job descriptions and 39% plan to implement it for resume screening. Additionally, 48% of organisations are using AI for drafting employee communications, and 45% intend to utilise AI for answering common HR-related queries. In learning and development, 29% of organisations plan to employ AI for skills documentation and training assessments.
The Hackett Group emphasises that productivity improvements and capacity gains achieved through Gen AI will enable HR departments to address the productivity gap and focus on their primary objectives for 2025. The study reveals that 77% of HR organisations have initiatives to leverage technology to enhance the efficiency and effectiveness of HR services, with an anticipated 4.2% year-over-year increase in automation.
To accelerate Gen AI initiatives and drive transformative value, The Hackett Group advises HR leaders to prioritise improvement projects based on their importance, value, time to benefit, and opportunity cost. They also recommend investing in reskilling and upskilling HR team members, including enhancing data and AI literacy, to prepare for organisational and job redesign. Simplifying processes and technology complexities and leading the redesign of talent management strategies are also advised.
A new report from Gartner projects that global spending on Gen AI will hit $644bn in 2025, reflecting a 76.4% rise from $365bn in 2024. This increase highlights the expanding integration of AI technologies across diverse sectors, as AI becomes increasingly integral to business operations and consumer products.
