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The new year is right around the corner, and the labor market is undergoing a profound transformation shaped by economic uncertainty, technological acceleration, and shifting employee expectations. For employers, understanding these dynamics and trends is essential to navigating talent and workforce development in 2026.
1. Employee Retention
One of the most worrying trends heading into 2026 is the growing disconnect between job stability and employee satisfaction. A recent report from HR software company Leapsome found that while 54% of employees are staying in their roles for stability, 1 in 3 are actively considering leaving due to disengagement and a lack of fulfillment.
Another factor to consider is that trust in HR is waning, particularly among non-managerial staff. The Leapsome survey further revealed that nearly half (46%) of employees do not view HR as a trusted advocate, citing concerns over transparency and protection of company policies. Furthermore, 1 in 2 nonmanagers don’t trust HR to protect them from harmful policies.
Retention metrics may appear stable, but beneath the surface, motivation and performance are wearing down. Employers must prioritize reengagement strategies, such as career development, transparent communication, and manager-led performance routines, to reignite purpose and productivity. Finally, 2026 is poised to be a critical year for rebuilding trust for many organizations, but progress can begin now.
2. Artificial Intelligence (AI) Adoption
AI investment and adoption have been accelerating in recent years, and employers are focusing on more ways to replace workers with technology. A Resume.org report from September 2025 revealed that nearly 3 in 10 companies have already replaced jobs with AI, and about 4 in 10 plan to do so by the end of 2026.
Additionally, Goldman Sachs Research noted that AI adoption is expected to have a modest and temporary impact on employment levels. It estimates that unemployment will increase by 0.5 percentage points during the AI transition period as displaced workers seek new positions.
As AI adoption increases, the impact on jobs will largely depend on how employers leverage the technology in their regular workflows. Many may focus on how AI can enhance human potential rather than simply replacing it. Employers will need to navigate the delicate balance between technological efficiency and workforce sustainability as these technologies are adopted.
3. Compensation Planning
Salary budgets are expected to rise modestly in 2026, with U.S. employers forecasting average increases of 3.4%, according to a survey from The Conference Board. Both Mercer and Payscale noted an average increase of 3.5% for next year. These figures are slightly below 2025 levels. Economic caution and reduced labor competition are influencing these decisions. In fact, 6 in 10 companies cite economic uncertainty as a key restraint to their hiring and salary decisions. Some organizations are moving more slowly to fill positions left open by employees and may allocate their salary budgets more for internal investments, such as employee development.
Compensation strategies should be aligned with performance, market benchmarks, and employee expectations. Total rewards packages, including benefits, flexibility, and career growth, will play a critical role in attracting and retaining talent.
4. Gig Work
The labor market is showing signs of softening. Unemployment has ticked up, and job creation has slowed across certain sectors, including manufacturing, retail, and hospitality. Employers are increasingly relying on gig, contract, and temporary workers to maintain workplace agility without long-term commitments.
Workforce planning in 2026 will demand flexibility. Organizations may need to explore scalable staffing models, including project-based roles, while maintaining a strong employer brand to attract top talent in a competitive landscape.
Looking Ahead
In 2026, organizations will be challenged to rethink traditional workplace models and adopt greater adaptability. Success will hinge on balancing technological advancement with human connection, economic caution with strategic investment, and short-term agility with long-term vision.
© 2025 Zywave, Inc. All rights reserved.
How GTM Can Help You Manage Talent in 2026 and Beyond
If you’re looking to stay on top of these trends to maintain a competitive edge in today’s workplace, but don’t have the HR resources to do so, GTM is here to assist. Our cultural review service can help you improve employee retention by providing an unbiased assessment of how your workers feel about their employment, giving you the tools you need to make changes and boost satisfaction.
Our compensation analysis service can help you ensure your pay structure is competitive, equitable, and aligned with your business strategies, so you can attract top candidates and reduce turnover.
Or if you simply need help recruiting and hiring the right employees, our consultants use the latest sourcing methods, along with their well-established networks and connections, to identify and connect you with top-notch talent nationwide.
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