Workday: Is a Generational Divide Affecting Hiring?

A generational divergence in strategic workforce priorities is emerging, with millennial leaders prioritising skills-based hiring more urgently than their Generation X counterparts.

New research from Workday found that while business leaders are aligned on the need for digital skills, their approaches to talent transformation and readiness for AI differ.

The analysis, based on The Global State of Skills research, surveyed business leaders on their transformation priorities. According to the findings, 92% of millennial leaders (aged 28-43) believe skills-based hiring is critical for economic growth.

This compares to 76% of Generation X leaders (aged 44-59). The sense of urgency is also split, with 60% of millennial leaders expressing concern about skills shortages appearing within three years, a view shared by 47% of Gen X leaders.

While both cohorts agree that digital literacy and Gen AI are important for meeting organisational goals in the next five years, their secondary priorities diverge. Millennial leaders tend to place a higher value on human-centric skills like leadership and communication.

In contrast, Generation X leaders emphasise operational and specialist skills, such as project management and engineering.

Differing views on skills-based solutions

This strategic divide extends to how each generation perceives the benefits of skills-based talent management. For instance, 89% of millennial leaders support using these approaches to close productivity gaps, compared to 72% of their Gen X colleagues.

A similar gap exists regarding unemployment, with 74% of millennials believing skills-based strategies can reduce it, versus 55% of Gen X leaders.

The implications for diversity and inclusion are also viewed differently. According to the research, 82% of millennial leaders connect skills-based hiring to a more diverse workforce, a perspective held by 67% of Gen X leaders.

Daniel Pell, Vice President and Country Manager, UKI, Workday, says: “The UK faces a critical challenge: our workforce models are lagging behind the pace of technological change. To compete in an AI-driven economy, businesses must rethink how they identify and develop skills.”

AI adoption and implementation uncertainty

Both generations recognise that AI can enable a skills-based organisational transition by automating tasks and helping to predict future skills gaps. However, there is a notable difference in the perceived clarity of AI implementation.

The Workday research reveals that 34% of millennial leaders report their organisations lack a clear strategy for using AI to address talent challenges. This contrasts with only 14% of Generation X leaders who report similar uncertainty.

Despite this, adoption appears to be progressing. The research indicates 92% of millennial leaders and 86% of Generation X leaders believe their organisations are successfully moving toward skills-based models.

Paul O’Sullivan, SVP Solution Engineering and UKI CTO at Salesforce, says: “Agentic AI is ushering in a new world of digital labour, where you can scale and transform with autonomous agents whilst augmenting the workforce. This represents a unique opportunity to unlock new levels of productivity, autonomy, and speed only if leaders and workers reskill and upskill.”

Integrating workforce and technology strategy

The findings suggest that for organisations to remain competitive, they must align their workforce strategy with technological advancements. This involves treating skills as a core component of business strategy rather than a secondary HR function.

Change management approaches also appear to differ by generation, with millennials focused on accelerating transformation and Gen X prioritising clear communication.

Prasun Shah, Global CTO & AI Lead, Workforce Consulting at PwC, says: “Skills are now a strategic asset, not a side conversation. Successful AI adoption depends on an organisation's ability to reskill at scale, align workforce strategies with business goals, and design work where people and AI complement each other.”

As industries continue to evolve with AI, navigating these generational differences in leadership will be crucial.

Daniel says: “This is not a question of technology alone, it is a question of leadership, agility and long-term competitiveness. The organisations that succeed will be those that treat workforce transformation as a strategic priority, ensuring both people and AI can work effectively together.”

This integrated approach to workforce and AI transformation could be what separates leading firms from the competition.

Prasun says: “Leaders who approach AI and workforce transformation as a single, integrated journey will have an advantage in creating lasting competitive advantage.”