7 essential lessons for HR leaders from Davos 2025

Davos 2025 brought together business leaders, policymakers and futurists to dissect the biggest transformations in the world of work. It was no surprise that the big thing on everyone’s lips was artificial intelligence. But when it came to people and work, whether it was about AI augmentation, the gig economy and global talent shifts, the discussion wasn’t just about what’s coming next but about what must be done now. So here are my seven biggest takeaways HR and people leaders need to know.

1. Productivity is soaring thanks to AI, so why aren’t wages?

What was said?

AI and workforce augmentation are driving unprecedented productivity gains, particularly among lower-skilled workers. But there’s a growing risk that these benefits will flow primarily to shareholders and tech creators rather than the workers whose jobs are being reshaped. Without intervention, AI could widen income inequality rather than creating economic mobility. The challenge for HR and leaders is to ensure productivity gains translate into higher wages, better job security and fairer career progression.

The evidence

• AI has the potential to reduce skill gaps rather than widen them. Internal research from Cognizant found that AI tools increased productivity by 35% for lower-skilled workers, compared to just 15% for high-performing workers. This suggests AI could level the playing field, allowing more workers to access higher-skilled tasks without years of formal education. “It's a kind of leveller. You get a sense that you can create upward social mobility in jobs if you pivot it well enough not to replace humans but to augment humans,” said Ravi Kumar S, CEO of Cognizant.
• Yet, history warns that productivity growth does not automatically lead to higher wages. Luc Triangle, general secretary of the International Trade Union Confederation (ITUC), pointed out that despite rising GDP and economic expansion, workers’ share of that growth has declined. “The growth in productivity is not shared with those who create the wealth,” he said, warning that failing to correct this imbalance will lead to worker unrest and rising inequality.
• Access to AI tools and training is another challenge. Mohamed Kande, global chairman of PwC, highlighted the new digital divide, where AI augmentation is becoming a privilege of the largest companies and best-resourced employees. Without widespread AI adoption across industries, the benefits of augmentation will remain concentrated among the few.
• The key issue is who benefits from AI’s economic impact. Cogizant’s Kumar warned that unless companies and policymakers intentionally design AI-driven work to reward workers, the value will default to shareholders and software creators rather than employees.
• May Habib, CEO of Writer AI, emphasised the importance of change management in enabling all employees to benefit from AI adoption: "It's like all of us needing to relearn how to read and write. It is so fundamentally different but ,when you've done it right, our top employees are 10x the productivity. That is really the kind of outcome that we don't want to exclude people from.”

What HR and people leaders should do now

• Ensure AI-driven productivity gains are shared fairly. Higher efficiency should translate into better wages, job security and career growth opportunities, not just corporate profit. HR must push for pay structures that reflect AI-enabled performance improvements.
• Create transparent AI pay policies. Workers should know how AI is impacting their roles, pay and progression. Avoid using AI to drive cost savings at the expense of fair compensation.
• Invest in AI-driven upskilling for all workers, not just high-performers. The biggest AI productivity gains are happening among lower-skilled employees. Make sure they have access to training, rather than only focusing on senior professionals.
• Monitor and prevent AI-driven burnout. More work doesn’t mean fairer work. AI is speeding up task execution, but without safeguards, this can increase workload expectations without raising pay. Establish clear boundaries around AI-powered performance metrics.
• Advocate for AI access across your industry. AI shouldn’t just benefit large corporations and tech-heavy roles. Work with policymakers, industry bodies and education providers to ensure AI literacy and augmentation opportunities reach all workers.

2. It’s about skills not degrees 

What was said?

The era of solely degree-based hiring is fading. Employers are shifting towards skills-based hiring and assessing candidates based on adaptability and learning agility rather than traditional credentials.

The evidence

• Omar Abbosh, CEO of Pearson, noted that the old ‘learn-to-earn’ conveyor belt is breaking down. “You put a toddler on the conveyor belt at one end, they graduate from a fancy place like the Wharton School, University of Pennsylvania at the other end and they go to Wall Street. That sort of pathway is clearly not enough. You have a whole range of vocational pathways and alternate skill pathways. And what we hear from employers is people with skills and degrees can be part but there are other ways as well  – and I think we're going to see a lot more of that in the future.”
• Vimal Kapur, CEO of Honeywell, and Claudia Azevedo, CEO of Portuguese's largest private employer Sonae, both agreed we are moving to a skills-based regime. However, Vimal : "We’re moving towards skills-based hiring. If AI can help workers develop expertise faster, employers must update hiring strategies to match reality."
• Adam Grant, Saul P Steinberg professor of management and psychology at Wharton, said he understood how organisations don’t want to just use pedigrees and credentials to decide who gets an opportunity. “We want to open doors for people who have lacked access,” he said. However, he noted that often the skills you hire people for today are no longer relevant to the problems you're solving tomorrow and that needs to be taken into account if pursuing a skills-based approach.
• Blake Moret, CEO of Rockwell Automation, highlighted how the firm was retraining veterans into high-paying technician roles through structured 12-week training programmes.

What HR and people leaders should do now

• Shift hiring frameworks to skills-based assessments, moving away from rigid degree requirements.
• Introduce learning agility metrics in recruitment – prioritise candidates who show rapid improvement and adaptability.
• Ensure career development paths include both technical and human-centred skills like leadership and collaboration.

3. The gig economy is here to stay – but it must be fair

What was said?

The gig economy now accounts for 12% of the global workforce, according to the World Bank. It offers flexibility and opportunities, especially for marginalised workers. However, concerns over social protection, fair pay and long-term security remain unresolved. Without new regulatory frameworks and company-led initiatives, gig workers risk being trapped in low-paid, precarious roles with no safety net.

The evidence

• Luana Marques Garcia Ozemela, chief sustainability officer at Brazil-based platform delivery company iFood, noted that food delivery alone generates about a $150 billion in annual revenues. In many cases these jobs serve as a crucial income source for people who struggle to access traditional employment. "For many marginalised and excluded groups this is their only hope for income,” she said.
• However, while the flexibility of gig work is appealing it often comes at a cost. Many workers lack basic protections such as healthcare, pensions and stable earnings. Hassan Elkhatib, Egypt’s minister of investment and foreign trade, said that often gig work came with a stigma, with workers having no recognition or respect.
• pointed to a fundamental issue: “Who would pay for the medical insurance or any type of support? These big companies need to actually provide the minimum support, minimum pay.” Without intervention, gig work risks reinforcing economic insecurity rather than creating sustainable livelihoods.
• In some regions gig work is acting as a bridge between informal employment and more structured work models. Erika Kraemer Mbula, professor of economics at the University of Johannesburg, highlighted how gig work is blurring the lines between formal and informal employment in Africa. “Gig work may provide this hybrid pathway towards formalisation, inserting elements of formal processes into what otherwise would be informal work,” she said. However, without regulation, these opportunities can remain precarious.
• Businesses are beginning to step in where governments have been slow to act. At iFood, Ozemela said the company has introduced measures to improve worker protections, including free insurance, legal support and mental health services. But she also stressed that wider change is needed. “Let’s not use old frameworks to govern new things. We need new frameworks to govern this.”
• At a broader level the lines between gig work, freelance work and permanent employment are already starting to blur. Sander van ’t Noordende, chief executive of Randstad, noted that work will increasingly become “work-form agnostic,” where employers and workers negotiate the best model for each role. This means businesses must rethink their approach to workforce planning, ensuring that gig work does not become a loophole to avoid responsibilities to workers.

What HR and people leaders should do now

• Advocate for fair gig work practices. If your organisation relies on gig workers, push for fair pay, access to benefits and transparent working conditions.
• Design portable benefits schemes. Gig workers often juggle multiple jobs. Consider how pensions, insurance and learning opportunities can move with them.
• Build flexible work models for all. The rise of gig work signals a broader shift towards individualised work arrangements. Offer employees autonomy while ensuring security.
• Engage policymakers on new labour frameworks. The future of work requires fresh regulation that balances flexibility with fairness. Support policy discussions that reflect modern work realities.

4. Collective bargaining is evolving and HR needs to catch up

What was said?

The traditional model of collective bargaining – structured negotiations between employers and unions – was built for an industrial economy. But as tech-driven work models expand, it’s no longer fit for purpose. Workers in sectors like logistics, AI and the gig economy are demanding representation, yet many face legal roadblocks, company resistance and fragmented employment structures. Unions and policymakers are now experimenting with new approaches to worker voice, sector-wide agreements and digital organising to keep pace with these changes.

The evidence

• Collective bargaining is struggling to keep up with platform work, automation, and AI-driven employment models. Many US workers are blocked from forming unions due to outdated labour laws. Elizabeth Shuler, president of the AFL-CIO, noted that tech companies take vastly different approaches to labour relations.
• Microsoft has agreed to let workers unionise, recognising that early collaboration on AI and automation benefits both employees and the company.
• Amazon, by contrast, is deploying AI to monitor worker movements and suppress union efforts, firing employees via algorithm in some cases. “Workers are surveilled, their every wrist movement tracked. They are followed into restrooms, monitored, sometimes fired by an algorithm, never speaking to a human,” Shuler said.
• New models are emerging in response. In Poland,the Social Dialogue Council provides unions and employers with quasi-legislative powers, allowing them to propose labour regulations rather than just negotiate contracts. Minister Agnieszka Dziemianowicz-Bąk sees this as crucial to ensuring workers have a voice in cross-border employment models, where national-level bargaining often fails.
• Unions are also experimenting with digital-first organising and sectoral bargaining. In Massachusetts, ride-share drivers successfully won the right to unionise through a state-level ballot initiative, bypassing federal restrictions. This signals a potential shift towards industry-wide agreements rather than company-by-company negotiations.
• At the company level some firms are rethinking the employer-employee relationship. Blake Moret, CEO of Rockwell Automation, prefers a company-led engagement model where employers provide workers with training, cybersecurity education, and job security incentives rather than union partnerships. However, this approach relies heavily on corporate goodwill rather than enforceable worker rights.

What HR and people leaders should do now

• Recognise that employee activism is growing. Workers in tech, logistics and AI-heavy industries are pushing for new forms of representation. Be active in offering structured dialogue channels rather than waiting for unionisation efforts to emerge.
• Understand sectoral bargaining. New approaches – where unions negotiate at an industry level rather than company by company – are gaining traction. HR teams need to anticipate how this could impact wage structures, benefits and workforce planning.
• Adapt collective agreements for the AI era. Automation and algorithmic management should not outpace worker rights. Companies must engage early with employees on AI deployment, ensuring transparency and fairness in decision-making.
• Prepare for regulatory shifts. Governments are testing new labour models, from Poland’s Social Dialogue Council to the EU’s platform worker directive. These policies could reshape employment classifications, benefits and bargaining rights, especially for gig and remote workers.
• Build a future-proof engagement strategy. Collective bargaining is not just avouyt wages but about job security in an automated world. HR leaders must co-create frameworks with employees that protect them against job displacement, algorithmic bias and unfair surveillance.

5.   A new fight for talent is coming. Are you ready?

What was said?

For years developed economies have debated immigration as a political issue. But soon it will become an economic necessity. Ageing populations in Europe, North America and parts of Asia are shrinking their workforces, while regions like Africa are experiencing rapid labour force growth. Businesses and governments will soon compete for workers, not resist them. The challenge for employers is to stop thinking defensively about talent shortages and start preparing to attract, integrate and retain workers from across the world.

The evidence

The numbers are stark:  the US, for example, added four million workers last year, 90% of whom were  immigrants. Some 68% of farmers and agricultural jobs, 30% of hospitality and 25% of healthcare workers in the States are immigrants. This pattern is repeating across the developed nations, albeit at different levels. Without migration labour shortages will become even more severe, especially in agriculture, healthcare, construction and services.

• Hisayuki Idekoba, CEO of Recruit Holdings which owns Indeed and Glassdoor, pointed to a general uptick in ‘job clicks’ coming from outside these nations and noted that employers are already shifting towards hiring from abroad. “In the UK visa sponsorship jobs are increasing.” In some industries, like pharmacy, almost 5% of jobs now explicitly offer visa sponsorship.
• Meanwhile, governments continue to restrict migration, despite clear economic needs. Amy Pope, director-general of the International Organization for Migration (IOM), warned that we are watching governments put up barriers to migration at exactly the moment when they need more workers than ever.  But, she said: “I think at some point we're going to have the economies of Europe and the United States and Canada and everybody else fighting over migrants.”
• The competition for talent will only intensify as demographic imbalances grow. By 2050 one in three people of working age will be African. Erika Kraemer Mbula, professor of economics at the University of Johannesburg, described the continent as a future global talent hub. “We have a young, ambitious workforce. The opportunity now is to train and connect them with global industries—whether that means bringing jobs to Africa or opening up pathways to work abroad.” But she noted that not everyone wants to leave their home country. “How do we also take advantage of the possibilities of remote work? When people are talented and skilled, not everybody wants to leave,” she said.

The stakes are high: regions that fail to attract and retain workers will struggle to sustain economic growth while those that embrace migration and global talent will thrive.

What HR and people leaders should do now

• Stop seeing migration as a challenge but see it as a competitive advantage. Companies that actively recruit and integrate international talent will be ahead of the curve as workforce shortages worsen.
• Look beyond local talent pools. If your recruitment strategy only targets domestic candidates you risk missing out on highly skilled, globally mobile workers.
• Make work more accessible for global hires. Consider how visa sponsorship, relocation support and language training can widen your talent pool rather than limit it.
• Support skills development in emerging labour markets. Instead of waiting for talent to arrive, invest in partnerships with training programmes in Africa and other fast-growing regions to build the workforce of the future.
• Adapt to new workforce expectations. Many younger workers prefer remote and flexible work models. If your roles require on-site work, consider how automation, job design and compensation structures can make these positions more attractive.

6. Gen Z won’t fit into your workplace – you need to fit into theirs

What was said?

For decades companies have set the rules of work: when, where and how employees operate. But Gen Z won’t accept rigid structures built for past generations. Instead, they expect workplaces to adapt to their values, their ways of working and their expectations for flexibility and mental wellbeing. For HR and people leaders this is a fundamental shift. Companies that insist on old models of productivity, leadership and office culture will struggle to attract and retain Gen Z talent. Those that listen, adapt and build workplaces around Gen Z’s strengths will be the employers of choice in the years ahead.

The evidence

• Gen Z is already transforming the workforce. At EY Gen Z makes up more than a third of employees today and by 2030, they will be 70%. Janet Truncale, global chair and CEO of EY, emphasised that companies must abandon one-size-fits-all approaches. “For the first time we have five generations working together. It’s an opportunity and a challenge.”
• Gen Z prioritises flexibility, but that doesn’t mean they reject structure. Hauwa Mufti, impact officer at Yola Hub, argued that leaders must recognise the individualism of Gen Z workers. “Gen Z has a great sense of self. You can try to put them under one umbrella but no two Gen Zs are the same. What works for one doesn’t work for another. Companies need to listen and be flexible.”
• Mental health and work-life balance are non-negotiable. Jonathan Haidt, professor of ethical leadership at NYU, pointed out that Gen Z experiences higher levels of anxiety than previous generations. If workplaces fail to address this they will struggle with retention.
• Intergenerational collaboration is a competitive advantage. Truncale highlighted that the dynamic has shifted: “It’s not just about passing down knowledge. Gen Z is pulling us into their orbit. And we have to embrace that.” Companies that fail to adapt risk losing top talent to competitors who offer a more flexible, inclusive and responsive work environment.

What HR and people leaders should do now

• Move beyond traditional performance metrics. Productivity is not about presenteeism. Shift towards outcomes-based performance measurement that rewards impact, not hours.
• Personalise work experiences. Gen Z doesn’t expect a single approach to work. Consider how you can offer customised career pathways, flexible working models and different styles of learning and development.
• Build structured flexibility. Gen Z values autonomy but still wants guidance. Be clear about when in-person collaboration is essential and where flexibility can thrive.
• Put mental health at the centre of workplace culture. This isn’t about offering wellbeing benefits but workload expectations, psychological safety and recognising burnout before it happens.
• Embrace a two-way learning culture. Gen Z has as much to teach older generations as they have to learn. Foster mentorship, reverse mentorship, and cross-generational collaboration to bridge the knowledge gap and strengthen workplace culture.

7. Continuous learning is the only sustainable strategy

What was said?

The old ‘education → work → retirement’ model is obsolete and the only certainty is uncertainty. Learning agility is now the most critical skill and employers must therefore support lifelong learning.

The evidence

• Omar Abbosh, CEO of Pearson, noted that humans are living longer and we have no idea what jobs will exist in 10 years. “The one thing that we absolutely have to teach people is learning to learn.”
• Jayant Chaudhary, Minister for Skills and School Education India, pointed to an organisation targeting older senior management, those aged over 50. “They are saying we are going to teach you AI first as there’s a lot of insecurity in people in this age category.”
• Claudia Azevedo, CEO of Sonae, believed company culture plays a large role in whether an organisation embraces a continuous learning strategy. “If you're a know-it-all organisation you don’t feel there is a need to learn. But if you get a corporate culture in which everybody feels that they have to learn, that being curious is the biggest skill they can have, that will help a lot.”
• Vimal Kapur, CEO of Honeywell, argued that continual learning was vital in product-led companies, particularly among product managers who will need to reimagine products. One without the other doesn’t work, he said.
• One key area that is often overlooked is continuous learning as a CEO. “The day I stop learning, I'm afraid I'll be out of a job very quickly. It's just imperative in today's world: you have to just refresh your skills, be it leadership, be it technology or engaging with customers, it's  constant learning all the time,” said Kapur. 

What HR and people leaders should do now

• Make continuous learning a business priority not a perk.
• Build AI upskilling into all roles, ensuring employees stay ahead of technological shifts.
• Foster a culture where adaptability is rewarded, embedding learning agility into performance metrics.
• Invest more in employer-driven career transition programmes rather than relying solely on individuals to reskill.
• Develop structured learning pathways for all career stages. Continuous learning isn’t just for early-career employees. Implement tailored learning programmes for senior leaders, mid-career professionals, and entry-level workers to ensure ongoing skills development at every stage of employment.
• Encourage peer-led and cross-functional learning. Create learning networks within your organisation where employees can teach and learn from each other. This could include reverse mentorship programmes, internal AI academies or rotational learning opportunities that expose employees to new skills beyond their current roles.