Why is HR’s Workload Expected to Rise by 9% in 2026?

There is a stark gap between ambition and execution for HR, with leaders recognising the need to transform, but lacking the means to execute, according to The Hackett Group’s latest report, 2026 Key Issues Study.

The Hackett Group – a Gen AI consultancy and enterprise digital transformation firm – says that this is creating a widening disconnect between strategic priorities and day-to-day activities as workforce demands intensify.

In the survey, The Hackett Group polls organisations headquartered in North America and Europe, with revenue exceeding $1 billion. The research was conducted in late 2025.

Are HR leaders being stretched too thin?

HR’s workload is expected to increase by 9% in 2026, even though operating budgets will only increase by 1%, and staffing will remain flat.

Despite these constraints, 83% of organisations now expect more from their HR teams

This is creating a “do more with less” crisis, according to Hackett Group, which is creating a “significant disconnect” between the demands being put on HR and the resources they have available. 

Technological investment was reported to increase by 9%, reflecting an intentional pivot, yet “without operational model change, technology alone will not deliver the required impact.”

“Leaders are clear on the priorities – greater flexibility, stronger resilience and smarter use of technology,” Amanda Newfield, Global HR Applied Intelligence Program Leader at The Hackett Group, says.

“What’s holding many back is the growing gap between aspiration and capability. The organisations that will lead are those willing to reimagine how work gets done, not just adding new tools to legacy processes.”

Moving towards Agentic AI

Throughout 2026, Hackett Group predicts that HR will shift away from Gen AI, which focuses on content creation, toward AI Agents, which execute workflows – particularly in transactional and talent-focused domains. 

This adoption is expected to reach 47% in HR by the close of 2026, and 42% in talent and performance management. 

Additionally, employee mobility will remain a strategic priority, with businesses almost doubling AI adoption from 28% to 47%. 

According to Hackett Group, this data signals a “growing recognition that AI can streamline transactions, reduce bias and better align performance with business goals.” 

However, strategic capabilities, such as skills architecture and workforce planning, will remain underdeveloped. 

Strengthening the workforce with AI

Although HR leaders have AI technology at their disposal, Hackett Group’s report suggests 59% of leaders lack an implementation road map that would allow them to focus on strategy rather than “feeding systems,” even though 81% understand the value of intelligent technology. 

HR leaders must therefore focus on uncovering the obstacles that are stalling progress in their businesses.

These were most commonly found to be data quality concerns (48%), workforce change management challenges (44%), data privacy and regulatory compliance (42%), limited AI talent (42%), and insufficient executive sponsorship (38%).

To manage and overcome these challenges, organisations need to adopt a targeted, strategic approach, with the report suggesting three strategic mandates for HR leaders:

1. Workplace design: Remove boundaries within workplace environments that promote talent agility and cross-functional synergy. This will allow skills to flow more freely, regardless of location or role restrictions.
2. Workforce resilience: Foster a future-ready team by integrating AI into the organisational fabric, supported by a culture of upskilling and growth.
3. HR evolution: Reposition HR as a driver of change by modernising its delivery model and centralising data. By leveraging smart automation, HR will be able to better streamline operations and provide deeper insights for stronger decision-making.

Concluding, Meena Singh, Senior Research Manager at The Hackett Group shared that the “real impact of AI in HR” is when it is able to “restructure and reshape” how work is done and how decisions are made.

“Now is the moment for HR to reimagine its operating model – strengthening data, governance and digital capabilities to keep pace with rising organisational expectations.”