Sent this by a friend? Sign up here to receive HCI in your inbox every week.

By Ken Stibler; Powered by Reyvism Analytics

The value of clarity and empathy are surging

The premium on basic human connection is rising exactly as fast as the technology meant to replace it. While leaders obsess over AI integration, Gallup’s latest data shows that the workforce is quietly checking out.

There are 3.2 million fewer engaged workers today than there were in 2023. The root cause is a profound sense of disconnection. In 2020, 54% of Millennial and Gen-Z employees felt someone cared about them at work. Today, that number is 41%. The organizations winning right now are the ones treating empathy as a hard operational requirement.

The mechanism for delivering that empathy is what researchers call attunement. A new study by found that leaders who practice four specific skills (flexibility, reading nonverbal cues, self-regulation, and collaboration) see measurable jumps in team cohesion and psychological safety.

Flexibility means asking what a team needs rather than assuming. Reading cues means paying attention to the silence on a Zoom call. Self-regulation means managing your own stress so you do not transfer it to your direct reports.

But empathy without clarity is just sympathy. When performance criteria are vague, trust erodes and stress spikes. McLean & Co found that employees who clearly understand their job expectations are 8.6 times more likely to be engaged.

Organizations that fail to provide this clarity see voluntary turnover rates 40% higher than those that do. The mandate for HR and senior leadership is clear: before you ask your teams to adapt to the next technological shift, you have to ensure they actually understand how they are being measured today.

Younger employees are sabotaging AI adoption efforts

The biggest threat to your technology strategy is coming from the demographic you assumed would champion it. A new report from Writer and Workplace Intelligence found that 29% of knowledge workers admit to actively sabotaging their company’s AI rollout.

Among Gen Z workers, the number jumps to 44%. The sabotage is not subtle. Employees are entering proprietary information into public AI tools, refusing to use approved platforms, tampering with performance reviews, and intentionally generating low-quality work to make the technology look bad.

They are doing this because they are terrified. Nearly a third of those sabotaging the tools cited fear that AI would take their jobs. But the resistance is a strategic error. Sixty percent of executives say they are considering cutting employees who refuse to adopt AI, and 77% say those who refuse to become proficient will not be considered for promotions.

The divide is already showing up in the data: AI “super-users” are three times more likely to have received a promotion and pay raise in the past year. The challenge for leaders is not buying better tools. It is convincing a fearful workforce that using the tools is the only way to stay employed.

Quote of the Week:

"The leaders who are putting in the work to radically redesign operations with human-agent collaboration at the center are the ones compounding their advantage in ways competitors can't replicate."

— May Habib, CEO of Writer

Reading List:

Macro fears lead small business to cut back on hiring

The latest U.S. Chamber of Commerce Small Business Index shows a sharp decline in optimism on the economy, investment, and hiring. While 69% of small business owners rate their own business as being in good health, only 28% say the U.S. economy is in good health. Consequently, just 30% expect to increase staff in the year ahead, a 12-point drop from the previous quarter. Inflation remains the top concern for the 17th consecutive quarter.

Middle management is undergoing an identity shift

Large companies are redefining middle management roles and handing off work to AI. Large companies are shifting from manager titles to “org leads” and “player-coaches" who build alongside their teams. Employers advertised 12.3% fewer middle-manager jobs in 2025 than in 2024. While fully offloading management to AI is impractical, the shift toward smaller, cross-functional teams with AI support is accelerating.

Companies increasingly turn to “in office trials” in interviews

Hiring managers increasingly are expecting candidates to show their live work. Companies are using work trials, job simulations, and live tests to evaluate candidates. Startups like Rounds use AI agents to conduct technical simulations, while others pay candidates to work in the office for a few days. The goal is to see how candidates think, adapt, and use AI tools to accelerate their work.

Data Point

In Other News

• Why More People Are Dropping Out of the Job Market. (Wall Street Journal)

• US workers increasingly trapped in the ‘Great Detachment’ as hiring slows, report shows. (Fox Business)

• US workers are quitting at the lowest level in a decade. (HR Dive)

• Nearly half of American households have no retirement savings: In 2022, 46% of households reported retirement savings, with 26% above $100K and 9% over $500K. (USA Facts)

• AI may threaten critical thinking in the workplace. (HR Dive)

• You’re looking at the AI revolution all wrong, top economist says: 40% unemployment and a 3-day work week are the same thing. (Fortune)

Sent this by a friend? Sign up here to receive HCI in your inbox every week.

By Ken Stibler; Powered by Reyvism Analytics

The "Return to Human" Begins

Remember the “Return to Office”? The fight is still ongoing for many, after companies spent years optimizing for remote efficiency, then realized the isolation was hollowing out their cultures and dragged everyone back. We are watching the same correction play out with AI, only broader and more consequential.

AI has made good-enough work available to everyone. A polished cover letter, a competent brief, a passable customer interaction: these used to separate the serious from the unserious. Now they are table stakes. Seventy-five percent of senior HR leaders report a steep rise in AI-generated applications, and more than 40% have extended probation periods because they can no longer tell who is actually capable before the person starts working.

Beyond process, talent quality itself has dipped. When AI handles the messy, frustrating early-career work that builds real expertise, people look competent without becoming competent.

A software consultant with 25 years of experience let AI build his product for three months, then found he could not write code confidently when he took the wheel back. “My swing was off,” he said.

Multiply that across an entire generation of workers who never build the baseline, and you have a workforce that performs well on paper and breaks under pressure.

In response, companies are beginning to push back. L’Oreal has made interviews an “AI-free zone,” requiring every candidate to sit face-to-face with a trained recruiter. Dave & Buster’s is pouring investment into human service standards because its CEO recognizes that the guest experience can never exceed the team member experience.

We believe that the trickle of anecdotes will become a new best practice as companies realize that where not to use AI is a more important decision than where you can.

CEOs Increasingly Feel Threatened by Their CFOs

Roughly one quarter of CEOs surveyed (26%) ranked CFOs as the top job security risk within their own C-suites, followed closely by COOs (24%) and chief commercial officers (20%), according to Boston Consulting Group’s CEO Insomnia Index.

The perceived vulnerability is structural: finance chiefs regularly brief the board on financial performance, forecasts and capital allocation, positioning them as the CEO’s natural heir apparent in ways that other C-suite roles simply do not.

The anxiety has a basis in recent data. CFO to CEO promotions reached their highest level in a decade last year, with more than 10% of sitting CEOs coming directly from a top finance seat, up from 7% in 2024 according to Crist Kolder Associates.

Quote of the Week: Scary to everyone but the CEO

“AI is not yet a primary source of day-to-day pressure for many CEOs. 84% report feeling more energized than stressed by the need to innovate. The stress is coming from inside the house."

— BCG CEO Insomnia Index, April 2026

Reading List:

Manager workloads double

The average American manager now oversees 12 direct reports, nearly double what Gallup tracked in 2013, as AI-enabled cost-cutting guts middle management ranks. Some big companies taken the logic to its extreme with 50-to-1 employee-to-manager ratios. The human ledger is looking considerably worse than the balance sheet with these moves: 75% of HR leaders say managers are already overwhelmed, and 69% say they lack the skills to lead change effectively even before full AI integration takes hold.

Workers don’t know how to use AI

Forrester measured employee understanding of AI tools and found the results "alarming." Prompt engineering comprehension, integral to tools like Microsoft 365 Copilot, increased by only 4% from 2024 to 2025. Meanwhile, 96% of C-suite leaders expected AI to increase output while 77% of employees say AI tools actually increased their workload. Companies bought the tools and skipped the change management.

Decision-making by consensus increasingly doesn't work

The speed of AI-driven change has outpaced the consensus model. HBR argues that the companies surviving the next decade will be those courageous enough to establish clear decision rights rather than democratic processes. The organizations winning are not those with the best algorithms or the most data. They are the ones that have fixed how decisions get made.

In Other News

• America’s gig economy - Self-employment, at both the high and the low end, is keeping consumption afloat — but for how long? (Financial Times)

• New graduates say they would sacrifice pay for job stability. (HR Dive)

• The sneaky truth about the wave of AI layoffs: Tech companies are axing full-time roles. They’re hiring some back as contractors. (Business Insider)

• Oracle cutting thousands in latest layoff round as company continues to ramp AI spending. (CNBC)

• Jack Dorsey and Roelof Botha think AI can make middle management obsolete. (Fortune)

• Trump Team Scraps College Degrees for Hundreds of Federal Jobs. (Bloomberg)

• Jensen Huang just painted the most bold image of AI’s future: 7.5 million agents, 75,000 humans—100 AI workers for every person. (Fortune)

Sent this by a friend? Sign up here to receive HCI in your inbox every week.

By Ken Stibler; Powered by Reyvism Analytics

How to Lead Through Fear

Your employees are terrified. The data is unambiguous: for the first time, more U.S. workers are struggling than thriving, according to Gallup’s Q4 2025 survey. Worker engagement is at a decade low, and just 28% of workers say now is a good time to find a quality job, down from 70% in mid-2022. Globally, only 22% of workers feel their job is safe from elimination, per ADP’s survey of 39,000 workers. The workforce is restless but stuck, a combination that creates quiet deterioration.

• An example: 30-year-old CEO of $11 billion Harvey earned the backing of OpenAI and Sam Altman. He says you have to ‘re-earn’ your role every 6 months. (Fortune)

When workers cannot leave, discontent accumulates. The most engaged employees leave first. The ones who stay are increasingly those who feel they have no choice. Gallup finds that workers who are not thriving miss 53% more days due to health problems and are 32% more likely to be actively job seeking.

Leaders who treat this fear as information will win. It is a signal about clarity and fairness. The data shows that workers who feel secure are more productive and engaged. Creating that security, where warranted, costs almost nothing. Communicating it clearly costs even less. The organizations that do this well will find themselves with a captive audience that is actually paying attention.

Protecting your top performers

In an environment of widespread cost-cutting, leaders think they are protecting their top performers. The data shows the opposite is happening. The employees who drive the most value are the most exposed when development budgets are slashed, a mistake that costs organizations a 36% drag on share price growth over two years.

The mechanism is simple: top performers are the first to feel the loss of growth opportunities and the most likely to burn out from new administrative burdens. Protecting them is not about retention bonuses; it is about protecting the conditions under which they do their best work.

Quote of the Week: Work itself is changing

"57% of U.S. work hours are now automatable using technology that already exists today. Two years ago, that number was 30%. The gap is no longer about technology. It's about knowing where and how to start."

—McKinsey Global Institute, November 2025

Reading List:

White collar employees increasingly getting pay cuts

Among white-collar workers who changed jobs at the end of last year, 40% took salary cuts of more than 10%, the highest share in a decade, per Revelio Labs. With long-term unemployment nearly doubling in three years, employers are requiring more experience for open roles. For workers who accept a pay cut, the consequences compound, as future raises and offers are anchored to a lower base.

Performance reviews are shifting from awkward ritual to continuous conversation

Deloitte eliminated annual appraisals a decade ago, saving two million hours annually. Yet a Gallup poll finds 56% of employees still get a formal review once a year or less, and only 2% of CHROs say their systems work. The gap between research and reality is a change management problem, and it is costing organizations the engagement of their best people.

Why are we so relieved when meetings cancel?

A Rutgers University study finds that unexpectedly gaining time alters our perception of how that time passes, leading people to choose longer, more ambitious activities. The finding has a practical implication for leaders: over-scheduled teams are less capable of the deep, intentional work that moves the needle. Looks like the humble calendar is actually a leadership tool.

Data Point:

22%

The number of US employees that feel safe from layoffs, lower than Egypt, Nigeria, and most of the developing world according to an ADP survey of 39,000 workers across 36 markets.

In Other News

• Toxic managers dehumanize employees, leading to extreme burnout. (HR Dive)

• JPMorgan monitoring keystrokes and video calls of junior bankers. (Fortune)

• Leaders report a ‘growing gap’ between what’s expected of them and the support they receive. (HR Dive)

• How compensation teams can become strategic finance partners. (HR Dive)

• Highly skilled workers have been training AI — that comes at a cost. (Financial Times)

Sent this by a friend? Sign up here to receive HCI in your inbox every week.

By Ken Stibler; Powered by Reyvism Analytics

Accountability Is Leadership's Greatest Weakness

There is a 20-point gap between how leaders rate their own ability to create accountability and how their managers rate them. That is a performance problem. A recent Gallup study of seven core leadership competencies found that “create accountability” was the lowest-rated skill for both leaders and managers—and the one with the largest gap between leaders’ self-perception and the reality their teams experience.

This is the quiet crisis of accountability in most organizations, and it can only be addressed top. Beyond the implications for execution, this accountability gap is a primary driver of disengagement. Gallup finds that managers who believe their leaders are accountable are three times more likely to be engaged at work. The mechanism is simple: accountability drives clarity. When leaders fail to set clear expectations and hold the organization to them, the most common result is a quiet drift.

The takeaway is that accountability is a design choice. It is built into the systems that connect what you say matters to what you actually measure. It is reinforced in the weekly one-on-one, not just the annual review. And it starts with closing that 20-point gap by asking your own leadership team what they see, and really listening.

Your talent development budget’s been slashed. Now what?

AI budgets are soaring while talent development budgets are shrinking across the middle market. On paper, this promises efficiency, scalability, and a clear path to future-proofing the business. Investing in people, by contrast, can feel like a softer, less measurable bet.

The paradox is that the more powerful AI becomes, the more critical human skills like judgment, collaboration, and adaptability are to realizing its value. AI can automate tasks, but it cannot build trust, navigate ambiguity, or lead a team through change.

When organizations cut training, coaching, and leadership development, they are not just trimming a budget line; they are hollowing out the very capabilities they need to make their AI investments pay off. The result is a workforce that is stressed, disengaged, and unprepared to manage the complexity that AI introduces.

Quote of the Week: Valid or not, why broadcast this?

"The best leaders don't just hold their people accountable. They hold themselves accountable for their people's success."

—Jim Harter, Chief Scientist, Gallup

Reading List:

Why leaders lose the room in high-stakes meetings

Most advice on leadership communication focuses on presentation skills. But the most consequential communication happens in meetings where tough issues are being discussed. An MIT Sloan analysis finds that under pressure, leaders tend to lean too hard on their natural thinking process, inadvertently making it harder for the audience to follow, contribute, and align. The key is not to change your style, but to recognize how your style is experienced by others and build in safeguards to protect shared understanding.

Women are avoiding the technology that threatens them most

The jobs women hold are three times more likely to be automated by AI, yet women are using AI at a rate 25% lower than men on average. This is not a competence gap; it is a confidence and trust gap. A Fortune analysis warns that if this trend continues, we are at risk of creating a two-tiered AI economy, where one group reaps the benefits of augmentation while the other is left behind. The solution is not to push for blind adoption, but to address the underlying issues of bias, psychological safety, and equitable design.

Why talent lifecycle alignment quietly breaks after hiring

Organizations have invested heavily in improving hiring accuracy. Yet for many, the talent lifecycle quietly breaks down in the first year. A Talent Culture analysis argues the issue is rarely flawed hiring science. It is a measurement gap between what organizations hire for and what they reward. When performance evaluation systems reward different signals than those used during selection, the accuracy of hiring science stops mattering. This is a governance issue, not just an HR program.

Data Point: “Performance” reviews

14%

Number of employees that strongly agree performance reviews they receive inspire them to improve.

In Other News

• Toxic managers dehumanize employees, leading to extreme burnout. (HR Dive)

• JPMorgan monitoring keystrokes and video calls of junior bankers. (Fortune)

• Leaders report a ‘growing gap’ between what’s expected of them and the support they receive. (HR Dive)

• How compensation teams can become strategic finance partners. (HR Dive)

• Highly skilled workers have been training AI — that comes at a cost. (Financial Times)

Sent this by a friend? Sign up here to receive HCI in your inbox every week.

By Ken Stibler; Powered by Reyvism Analytics

Intelligence offers keys to win in an accelerating world

The world is moving faster than ever, but most companies…aren't. The rise of AI, shifting market structures, and a flood of information create a fog of uncertainty that leaves many leaders paralyzed. Winners in this new environment are those with the clearest and most compressed ‘informational supply chain.’ Accurate and complete information, delivered faster, means decision makers can avoid noise and act decisively while competitors are still trying to figure out what’s going on.

In most companies, intelligence is scattered. Market research lives in marketing, competitive analysis in strategy, and financial forecasting in finance. Each function provides a partial view, but nobody owns the full picture. This leads to rework, thin accountability, and a chronic inability to see the whole board. A true intelligence capability centralizes this function, giving leaders a single, unvarnished view of the competitive landscape.

Building this capability is a leadership imperative. It requires a relentless focus on what matters, a willingness to challenge your own assumptions, and the courage to make bets with incomplete information. The alternative is to watch from the sidelines as others build the future.

The key to making AI work? ‘Old school’ leadership

The hardest part of AI adoption isn’t the technology; it’s the people. The tools are here and they work (some better than others, granted). The bottleneck is the messy, human work of getting your team to actually use them. The companies that are seeing real ROI have better managers, not better models. They understand that AI adoption is a change management problem, not a technology problem.

This isn’t about hype or cash prizes for “innovation.” It’s about the unglamorous, day-to-day work of leadership: setting clear expectations, providing the right training, and holding people accountable. It’s the reason Accenture’s CEO has made AI skills required for promotion. It’s what Gartner is getting at when they say managers, not HR, are the key to company-wide adoption. And it’s about recognizing that employee resistance isn’t irrational; it’s a predictable response to a poorly managed change process.

Quote of the Week: Valid or not, why broadcast this?

“Part of working hard is sending emails to the team on a Saturday. And if I don’t get a response on Saturday, sending them an email on Sunday with a question mark. What’s going on?”

—Dara Khosrowshahi, CEO of Uber

Reading List:

Employees and executives drift further apart on AI

The disconnect between the C-suite and the rest of the organization on AI is getting wider. A recent survey found that while 86% of executives believe AI use is mandatory, only 49% of middle managers agree. The C-suite is selling a vision of AI as a transformative teammate, while employees are experiencing it as a helpful but limited tool. The result is a stalemate. The companies that have narrowed the gap find that empowered managers are key to translate C-suite vision into day-to-day reality.

Most companies lack real plans for change communications

61% of companies have no formal approach to change communication, according to a recent Gallagher survey. During ongoing disruption, communicating change effectively is a core competency. Without it, every new initiative is dead on arrival. The fact that most companies have six or fewer people in a communications role, regardless of size, shows how undervalued this function is. If you don’t have a real plan for communicating change, you don’t have a real plan for executing it.

Ask not what your COO can do for you…

The COO is no longer just an operator; they are the CEO’s strategic partner in execution. As CEOs spend more time focused externally, the COO is the one who has to translate vision into reality. Yet the COO’s success increasingly depends on their ability to build strong relationships with their C-suite peers more than abstract “operational excellence”. They are the connective tissue of the organization, but if they lack the time and space to “grab a beer” across the organization, they can quickly go from effective partner to inefficient enforcer.

Data Point: Mandatory to use, option to learn?

35%

Number of businesses that report having data and AI upskilling programs available to all of their employees.

In Other News

• Mastercard bots target C-suite roles: Card giant offers SMEs a virtual chief financial officer through artificial intelligence technology, with other C-suite roles to follow. (Computer Weekly)

• Workers who are receptive to ‘corporate BS’ may struggle with analytical thinking. (HR Dive)

• How AI Is Accelerating Skills-Based Hiring and Upskilling. (Talent Culture)

  US companies say they plan to accelerate global hiring despite hurdles. (HR Dive)

• Shadow AI rises as leaders choose speed over governance. (CIO Dive)

• AI Job Loss Is Breaking the Psyche of Workers, Psychiatrist Warns. (Futurism)

• Washington state wants to keep employers from microchipping workers, before anyone even gets the idea. (Fortune)

Sent this by a friend? Sign up here to receive HCI in your inbox every week.

By Ken Stibler; Powered by Reyvism Analytics

What skills does the modern workflows actually need?

An important note for hiring managers - there is not really as an “AI skill.” The rush to find people with this discrete, magical new competency misunderstand both the tech and the skills that can make it work. The ability to effectively use and even build generative AI tools are the same ones that have always mattered, just magnified: clarity of thought, precision of language, curiosity, and the bravery to change yourself. These are human skills. A-players already have them. The challenge isn’t finding new people; it’s supporting your people as they learn to apply their existing talents to a new class of tools.

The ManpowerGroup report that found “AI skills” are the hardest to find is better understood as a shortage of adaptability, not a shortage of coders. This is not just a philosophical point; it’s a practical one with huge ROI implications. A recent DataCamp report found that organizations with mature data and AI upskilling programs see double the return on their AI investments. That return isn’t coming from hiring a few expensive prompt engineers. It’s coming from a workforce that is empowered to think critically and experiment.

Look at Walmart. They are training 1.6 million employees not to become AI experts, but to use AI to be better at their jobs. The CEO takeaway is this: stop chasing a mythical beast. Your best people already have what it takes. Your job is to give them the tools, the permission, and the support to amplify their innate curiosity and judgment. The bottleneck isn’t talent; it’s a failure of leadership to trust the people you already have.

Managing change and attention budgets as real resources

The current volume of change organizations are facing is spurring a lot of calls to change everything—key functions, org charts, training. But the “budget” of leaders and employees for change and the intentional work it requires is being tapped out. Every new tool, process, or pivot draws down from a finite organizational capacity for change, and that budget is now deep in the red.

This a leadership mandate masquerading as a tech problem. The shift to new operating models isn’t free; it consumes a finite budget of attention and energy. That requires deep, disruptive change that consumes the very attention your team needs to do their actual jobs.

If you treat your team’s attention and their capacity to adapt as free and infinite resources, you will burn them out and your most important initiatives will fail. You have to budget for change as you budget capital. It’s a real asset, and it’s nearly depleted.

Quote of the Week: Failure as an absence of effort

"The worst thing is not to take a decision, because then nothing happens.”

Andreas Schierenbeck, CEO of Hitachi Energy, on why he pays his team to make decisions, not to wait for permission.

Reading List:

A HCI foray into parenting advice

Advice on dealing with kids is like managing with higher stakes and lower pay, which is why we normally avoid the subject. But a WSJ piece on how tech execs are raising their kids shows how much today’s kids won’t be educated by curriculums or schools. From leaders at Anthropic to Microsoft to Wharton, parents “in the know” are taking control of their education and emphasizing empathy, adaptability, critical thinking, and the ability to be in rooms with other humans (not GenZ/A’s natural strong-suits) as technical skills become table stakes.

Don’t plug legally questionable things into ChatGPT

If you or your team are plugging confidential information into a public AI, you’re committing malpractice. A federal court just made it clear in U.S. v. Heppner: your conversations with AI are not confidential. A CEO used Claude to research his own fraud case, and the court ruled those chats were not privileged and were fully discoverable. While a silly example, multiple studies have found that executives are the most likely group in organizations to break AI policies. Consider every AI prompt as if it will be read aloud in a deposition, because it just might.

Workplace gossip has an unappreciated upside

Your team is probably gossiping, and it might be holding them together. New research in the Journal of Business Ethics found that while employees avoid their boss after gossiping, they also report a greater sense of belonging and collaboration with their peers. This informal channel can be a powerful, if risky, tool for building team cohesion. The challenge is to foster an environment of psychological safety where the energy spent on negative gossip can be channeled into open, constructive feedback. If your team is gossiping, it's a signal they don't feel safe talking to you.

Data Point: An indicator of financial stress

6%

The share of workers in 401(k) plans who took a hardship withdrawal in 2025—a record and from 4.8% in 2024.

In Other News

• RIP résumés: Slop is killing the résumé. Job hunters are scrambling for new ways to stand out. (Business Insider)

• Why pay-for-performance programs don’t always work. (HR Dive)

• Women Show Stronger Employee Engagement Amid Higher Burnout. (Gallup)

• Australian state to give legal right to work from home 2 days a week. (Financial Times)

• What if AI just makes us work harder? Employees have reported increased momentum, but also a feeling of having more to do. (Financial Times)

• Frictionless AI comes at a human cost to learning, growth and connection. (AAAS)

Sent this by a friend? Sign up here to receive HCI in your inbox every week.

By Ken Stibler; Powered by Reyvism Analytics

We’re talking about AI…because work is now tools + people

Many of our readers are in the middle market, where AI is an idea, a promise, or a nuisance more than a reality. And yet… the most seductive narrative in American work culture right now isn’t that AI will take your job. It’s that AI will save you from it. That’s the version the industry has spent the last three years selling to millions of nervous people who are eager to buy it.

A new study published in Harvard Business Review follows that argument to its actual conclusion, and what it finds that AI supercharges the intensity of work, rather than reducing it.

In companies with strong AI adoption, nobody was told to hit new targets, people just started doing more because the tools made more feel doable. But because they could do these things, work began bleeding into lunch breaks and late evenings. The employees’ to-do lists expanded to fill every hour that AI freed up, and then kept going.

The CEO takeaway: your best people are at the highest risk. The research shows that the first signs of burnout are coming from the people who embrace AI the most. The productivity gains are real, but the company captures them, not the employee, breeding resentment.

This a utilization problem. You’re burning out your most valuable asset—human judgment—on low-value review tasks. The companies that get this right will not be the ones with the most tools. They will be the ones that figured out how to make people and tools work together without burning both out.

Critical markets are rapidly breaking down, that’s a leadership problem

We hate saying things that make it feel like there’s more on the to do list. But in this case, three markets that every business depends on are deteriorating at the same time. Digital attention costs are soaring as platform saturation drives down engagement and drives up CPM.

Cost-per-hire climbed sharply in 2025 despite 1.8 million Americans searching for jobs for over 6 months and AI-d applications flood job platforms. Meanwhile, 74% of employers now call pharmacy costs unsustainable, with GLP-1 drugs alone reshaping benefits strategy from an HR decision into a board-level conversation.

Treating these as separate functional problems—a marketing problem, an HR problem, a finance problem—is the mistake. The rising costs and declining effectiveness across these domains demand a unified strategic response. The CEO takeaway: every dollar spent on employee retention is also a marketing dollar.

Every decision about benefits is also a decision about your cost of talent acquisition. Leaders who continue to manage these in silos are being be picked apart by converging crises, while those who see the connections and make the trade-offs will build a structural advantage their competitors won’t understand, and can’t, replicate.

Quote of the Week: Low hire, low dynamism

“The fact that it is low-hire, low-fire is actually not a great state to be in. The churn is important to the productivity growth.

You want to see the most talented go to the places where that talent is the most rewarded. And if we are in this really stable period, that means that talent is not being repositioned to its best use.”

— Nela Richardson, chief economist at ADP

Reading List:

CFO turnover reaches new high as flux extends across the C-Suite

CFO turnover hit a seven-year high last year, with one in nine CEOs at top public companies also being replaced. The churn is being driven by a combination of burnout, heavier workloads, and the need for a different kind of leader in a rapidly changing world. Boards are more impatient, and the playbooks of the past no longer apply. The new class of leaders is younger and less experienced, a sign that companies are prioritizing adaptability over tenure. The message is clear: the C-suite is in flux, and the pressure to perform has never been higher.

A white-collar labor shortage is quietly brewing

Headlines are sending high schoolers away from college on mass, with computer science enrollment plummeting and 60% of Gen Z reportedly pursuing skilled trade work. As white-collar workers contemplate a future where their skills are devalued, many are looking to trades that can’t be automated. This migration is overdue but could potentially create gaps in some area of white collar talent like finance and data analysis.

Nobody is prepared for retirement, here’s how to make that work for you

Americans aren’t ready for retirement. The average person thinks they need $2.1 million to retire comfortably, but 62% have less than $150,000 saved. As Gen X, the first generation primarily dependent on 401(k)s, begins to retire, the crisis will only get “harder and nastier.” For employers, this presents both a challenge and an opportunity. With so many people unprepared for retirement, there is a growing pool of experienced workers who are willing and able to keep working.

Data Point: HR turns to AI

82%

The percentage of HR leaders who say they’re comfortable using AI to perform some parts of their jobs, according to the Hartford Business Journal.

In Other News

• Why the Smartest Leaders Respond to Crisis By Saying Less. (Entrepreneur)

• JPMorgan analysis finds Trump’s tariffs are working on China—at a huge cost to American small business. (Fortune)

• People Trust Websites More When They Know a Human Is on Standby. (Wall Street Journal)

• What CEOs Mean When They Say Leading Is Complex. (WSJ/Mercer)

• The U.S. spent $30 billion to ditch textbooks for laptops and tablets: The result is the first generation less cognitively capable than their parents. (Fortune)

• SHRM: Demand for HR workers is down amid AI adoption. (HR Dive)

Sent this by a friend? Sign up here to receive HCI in your inbox every week.

By Ken Stibler; Powered by Reyvism Analytics

Leadership lessons from software: What got you here won’t get you there

The recent software industry meltdown offers an important lesson for today’s leaders. For anyone not familiar (after watching their 401ks drop) the stock market has wiped billions of value off after Claude maker Anthropic released a tool that can automate coding tasks like cloning the entire salesforce platform.

But the real story isn’t about software. It’s about what happens when the advantages you’ve spent decades building start rapidly eroding. Companies that built empires on recurring revenue watched their value proposition evaporate in a single trading session.

This is the new reality across industries, including in middle market businesses that you’d never suspect are being disrupted by AI and the broader pace of general change alike. The skills that made you successful, the business models that seemed unassailable, the competitive advantages you’ve cultivated can become liabilities faster than your planning cycle.

The companies surviving this transition aren’t the ones with the best technology. They’re the ones willing to abandon what worked yesterday. Leaders who wait for clarity before acting will find themselves managing decline rather than growth. Your next competitor isn’t improving on your model…they’re making it irrelevant.

Trust and skills are the growth engine leaders keep stalling

The gap between employer optimism and employee reality is offering a map to how growth plans are break down. While 96% of employers forecast growth in 2026, only 51% of workers agree. The disconnect is more about investment priorities than anything ephemeral. Companies historically reinvest productivity gains into more technology rather than the people who must use it, then wonder why workers don’t share their confidence.

High performers offer a lesson of how to approach this differently. They convert saved time into strategic capital for upskilling, collaboration, and judgment work, achieving double the ROI as a result. The pattern repeats in reorganizations: 88% of leaders believe their new structure will succeed, but only 36% of employees agree because only 22% receive adequate support to adapt.

Leaders overemphasize design while underinvesting in the transition itself. This isn’t a communication gap. It’s a trust deficit created by resource allocation choices that tell employees they’re secondary to the technology meant to help them.

Quote of the Week: Change is the beginning, not the end

"The announcement of a redesign isn't the finish line, it's the starting gun. Leaders who plan for how people will actually work in the new model, and who support them through that transition, are the ones who unlock results others never reach."

— Tracy Thurkow, partner at Bain & Co.

Reading List:

Gen Z’s “admin nights” reveal what’s missing at work

Finally a positive story about Gen Z! The FT reports how 20 somethings are turning tedious logistics tasks into social events, gathering with friends to collectively tackle bills and budgets. The trend works because of “body doubling,” where shared accountability makes hard tasks easier. But the deeper insight is what it reveals about work: people crave connection around difficult challenges, not just efficiency. Mixed-age groups add life experience that transforms admin into mentorship. When someone says the best part was “knowing I’m not alone,” they’re describing what’s absent in most workplace transformation efforts.

Deloitte's job title overhaul signals strategic intent

Deloitte is changing job titles for nearly 182,000 US employees by June to reflect its AI transformation priorities. The firm is "modernizing our talent architecture to provide a more tailored experience reflective of our professionals' broad range of skills and the work they do," a spokesperson told Business Insider. Experts say clear job titles can benefit employees by creating status and clarifying advancement paths, but warn that major changes imposed without consultation breed resentment. "Too often, senior leaders make these changes without inviting employees into the conversation," said Joe Mull, founder of Boss Hero School.

The HR-C-Suite divide on AI is a strategy failure

64% of execs agree AI is essential for competitive talent pools but nearly half say HR and C-Suite aren't aligned on its use. CHROs are simultaneously the most enthusiastic about AI's potential and the most concerned about job security impacts. This isn't contradiction, it's realism about managing a transition that leadership hasn't funded properly. The division means organizations will fall behind not because they lack AI tools, but because they lack agreement on how humans and AI work together.

Data Point: Think twice about the ROI of bye bye

45k

The average cost of turnover for a single worker.

In Other News

• Have you considered hiring a chief bullshit officer? (Financial Times)

• Learning through tiny bits: Why microlearning is the future of employee development. (London Loves Business)

• Employees say compliance training is ‘disconnected’ from real life. (HR Dive)

• Private-Sector Job Growth Cooled in January: America’s private sector added 22,000 jobs last month, according to human-resources firm ADP, well below estimates. (Wall Street Journal)

• What HR needs to know about hiring in the wake of a layoff: A reminder of the dos and don’ts when reorganizing your workforce. (HR Brew)

• AI is breaking the job application process — and forcing recruiters to rethink hiring and building the bench of talent. (Business Insider)

Sent this by a friend? Sign up here to receive HCI in your inbox every week.

By Ken Stibler; Powered by Reyvism Analytics

Focus and intentional decision making become scarce resources in the “AI-ed” organization

AI’s rapid advancement has ignited enthusiasm about its potential to revolutionize corporate decision-making by substituting for expensive, fallible humans. But it’s naïve to believe that by gathering ever more data and feeding it to ever more powerful algorithms alone, businesses can uncover the truth.

This false belief, what researchers call “dataism,” overlooks the nuanced human elements that remain irreplaceable. Workers now report getting only 2-3 hours of daily focus time, and Gartner predicts that overreliance on AI will cause worse decision-making in 30% of organizations by 2030.

Decisions are not simple exercises in data aggregation though. They involve selecting trustworthy sources, employing imagination to envision possibilities, and judging feasibility. These are areas where humans have innate advantages.

As AI automates routine tasks, it creates a vacuum in experience-building for early-career professionals. Without on-the-job learning, critical judgment cannot develop. Organizations must now explicitly cultivate human decision-making by rejecting simplistic “dataism”, ensuring leaders stay grounded in real-world phenomena, and making skills like intuition and imagination an explicit part of development. The future isn’t about choosing between humans and AI, but building hybrid systems where each plays to its strengths.

Breakdown of traditional organizational structures increase dependence on HR and middle management

The traditional organizational chart is dying. In its place, a new structure is emerging, one inspired by the octopus. An octopus operates according to what needs to be done, with a distributed intelligence system where work, not hierarchy, determines action. This is precisely the approach organizations need as AI reshapes work.

For decades, we’ve relied on hierarchical boxes and lines. But those charts are from an era when authority mattered more than agility. AI is obliterating these assumptions. Companies clinging to org-chart thinking are trying to fit AI into existing structures rather than reimagining how work gets done.

As companies flatten and AI automates administrative work, middle management and HR are being reinvented. Middle managers now oversee an average of 12.1 direct reports, up from 10.9 in 2024. Their effectiveness depends less on control and more on acting as translator-coaches.

Meanwhile, HR is undergoing what Josh Bersin calls “the great reinvention,” shifting from compliance to strategic work focused on talent architecture, culture, and AI orchestration. With AI expected to automate 30-40% of existing HR jobs, the profession is transforming, not shrinking.

Quote of the Week:

“Many of my students are concerned that the convenience of tech will stop them from developing the nuanced judgment they aspire to have. A little bit like a controlling parent, it makes life easier for you, then you don’t know how to manage life on your own.”

—Gianpiero Petriglieri, an associate professor of organisational behaviour on the risk of “cognitive atrophy” from over-relying on AI.

Reading List:

Workers vs companies on AI

As large public companies signal that AI will drive future efficiency and workforce reductions, some workers are pushing back by “friction-maxxing” (a newly popular GenZ-ism). This is the intentional choice to do things the harder way: opting for in-person meetings, reading full documents instead of AI summaries, and learning skills from scratch. It is a quiet rebellion against the “tyranny of convenience,” born from a desire to cultivate deep thinking and protect the human qualities that frictionless tech threatens to erode.

Automated applications creating hiring stress for talent acquisition

The hiring market is under “unprecedented strain,” with 90% of U.S. companies missing their 2025 hiring goals. While recruiters spend nearly 40% of their time on scheduling, the rise of AI-assisted and fraudulent applications has become the most anticipated challenge for 2026. This creates a paradox: while AI is seen as a solution for efficiency, it is also fueling a crisis of trust and a deluge of low-quality applications, forcing a reevaluation of how to find the best candidates in a sea of automated noise.

How top companies are bucking the engagement decline

While overall employee engagement continues its downward spiral, particularly among younger workers, a few top companies are bucking the trend via transparent leadership, meaningful recognition, and clear communication. With burnout’s influence on engagement growing, these companies prove that strong leadership can break the cycle. The small sliver of engagement winners show that a well-defined culture and a clear path for growth are the simply effective engagement tools in a world of increasingly complex problems.

Data Point: The Disappearing (Deep) Work Day

2-3 hours

The average amount of daily focus time a worker gets, defined as uninterrupted work periods without meetings, messages or tool switching, according to the Hubstaff 2026 Global Benchmarks Report.

In Other News

• The Trade Shortage Crisis: How Data Centers Are Exposing America’s Skills Gap. (Forbes)

• Highly educated but under pressure: The paradox facing L&D pros. (HR Executive)

• The US is headed for mass unemployment, and no one is prepared. (The Hill)

• Layoffs are piling up, heightening worker anxiety. Here are some of the biggest recent job cuts. (AP)

• Job seekers optimize resumes amid ATS ‘anxiety’. (HR Dive)

• Teaching employees to use AI could add up to $6.6T to US economy. (HR Dive)

• The Rise of Workslop — and 4 Ways to Counter the Negative Effects of AI. (HR Morning)

• Quantifying the Productivity Gains from AI. (Apollo)

Sent this by a friend? Sign up here to receive HCI in your inbox every week.

By Ken Stibler; Powered by Reyvism Analytics

‘Sink or swim’ engagement is back, but leadership still determines who survives

The labor market has shifted decisively back toward employers, and with it, a harder-edged management philosophy is re-emerging. As hiring slows, layoffs linger, and AI reshapes cost structures, many organizations are quietly abandoning the softer engagement strategies that defined the post-pandemic years. Performance expectations are rising, perks are disappearing, and loyalty is no longer assumed or rewarded.

This is not simply a return to pre-2020 norms. What makes the current moment distinct is that companies are tightening expectations while markets remain profitable and equity values strong. Employees are being asked to do more, with less leverage, in an environment where quitting is riskier and internal mobility is less visible. “Sink or swim” is becoming an implicit “engagement” strategy, even when leaders do not label it as such.

The organizations that will separate themselves are not those that squeeze hardest though. In a down labor market, employees are not asking for indulgence, but for predictability, fairness, and a credible path forward. Firms that invest in manager capability, transparent expectations, and real development will retain commitment even as power shifts back to employers. Those that do not may find that compliance replaces engagement, and that erosion is far harder to reverse.

Lack of career development changes employee loyalty

Even amidst the squeeze, employee loyalty has not disappeared, but it has become conditional on clarity. Workers may stay put in a weak job market, yet their attachment to employers depends on whether they see forward motion in skills, scope, or opportunity. When career paths are unclear, loyalty does not deepen. It simply pauses.

This creates a hidden retention risk. Employees hedge by taking on side projects, building portable skills, or mentally detaching, even if they are not actively job hunting. Employers that provide career clarity without promotions or pay increases can retain talent through the cycle. Those that delay will face attrition the moment conditions improve.

Quote of the Week: Little Changes, Big Difference

“You don’t need grand, expensive programs to make a real difference. Sometimes the most impactful benefits come from listening closely to employees and removing friction from their lives.”

—Eric Stark, cofounder and president at Slate, which added home cleaning services as an employee benefit after one worker requested it on LinkedIn

Reading List:

CEO confidence in short-term company growth has declined sharply

AI becomes the defining leadership topic as CEO confidence hits covid-low

CEO confidence in growth and execution has fallen to levels last seen during the pandemic, even as investment in AI accelerates. The tension is no longer about whether to adopt AI, but whether leadership teams can convert spending into durable performance gains. For many executives, the anxiety is not technological but organizational, stemming from uncertainty over skills, structure, and accountability.

Employee training is the investment that pays off twice

New research suggests that the return on training investments extends beyond frontline productivity. Better-trained employees reduce dependency, rework, and escalation, freeing managerial time and attention for higher-value decisions. Nearly half of training’s payoff may come indirectly through improved managerial leverage, a benefit most ROI models fail to capture.

AI’s hidden management tax becomes a drag on efficiency

While AI promises time savings, many organizations are losing a meaningful share of those gains to verification, correction, and oversight. Without clearer role design and stronger baseline skills, managers absorb the burden of monitoring AI-assisted work. In practice, this shifts cognitive load upward, limiting productivity improvements and increasing leadership strain.

Data Point: Not too confident

40%

Percentage. of productivity gains in the workplace due to artificial intelligence are being lost to rework and low-quality output, according to new research from Workday.

In Other News

• Trust has become the crisis CEOs can’t ignore at Davos, as new data show 70% of people turning more ‘insular’. (Fortune)

• Front-line supervisors are often promoted without leadership skills, Gallup says. (HR Dive)

• Thinking about HR succession? Expect to appoint a first-timer. (HR Brew)

• Policies Aren’t Enough to Retain Top Talent. You Need Systems. (HBR)

• The AI perception gap: How to ensure employers and workers are ready for imminent transformation. (World Economic Forum)

• As organizations race to adopt AI in 2026, Marsh’s Mercer says empower talent and redesign work to achieve meaningful gains. (Mercer)

• Measuring US workers’ capacity to adapt to AI-driven job displacement. (Brookings)

Sent this by a friend? Sign up here to receive HCI in your inbox every week.

By Ken Stibler; Powered by Reyvism Analytics

Skills create the organizational speed limit for AI success

AI adoption is accelerating, but capability gaps are starting to dictate the pace. Companies are realizing that infrastructure, security, and model access are no longer the primary bottlenecks. Execution now depends on how quickly teams can learn, adapt, and apply AI in real workflows.

That shift has exposed a silent constraint: skill mismatches buried inside functions and roles. Early adopter teams hit a wall when employees can’t bridge the gap between tool and task. Training is often generic, adoption is uneven, and leaders assume that basic AI literacy will scale into measurable returns. But without high-slope learners who can map use cases, test edge cases, and teach others, AI slows down rather than speeds up.

Productivity will be defined not by how much AI a company uses, but by how much its people can handle. Systems can be bought. Skills have to be built.

Adapt or build, the 2026 mandate for leadership

Nearly half of all executives report their businesses were highly disrupted over the past year. While pressures from regulation and supply chains have moderated, relentless challenges from energy prices, geopolitics, and cybersecurity persist. In this environment, AI has become the great divider, with 80% of executives expressing optimism.

The fastest-growing companies are converting this disruption into an advantage, yet it is their leaders who feel the most anxiety, making the corner office both the command center and the hot seat. 45% of executives considered quitting last year, amid a growing gap between the pace of change and leader’s ability to keep up.

CEOs now feel twice as likely to feel they are personally falling behind in knowledge and skills. In an era where disruption has eclipsed economic cycles as the primary driver of change, the burden of navigation falls squarely on their shoulders.

Quote of the Week: Adjusting to ongoing change

“The tweaks or changes [companies] are making now are just to adjust and to be more flexible and more agile given the changes to the global order. But they don’t see a reason to wholesale upend everything.”

— Dana M. Peterson chief economist at the Conference Board

Reading List:

Decline in early career jobs creates a talent cliff

Entry-level roles are quietly disappearing as automation, AI, and leaner org models shrink the number of true development positions. Without early reps, fewer workers build the experience and judgment needed to move into mid-level and leadership roles. The result is a growing talent cliff that will hit harder as internal pipelines dry up.

Middle management is being reinvented as more critical than ever

While job postings for middle managers have declined, the role itself is not disappearing but rather being reinvented. As organizations flatten, the need for middle managers to act as the connective tissue between strategy and execution has intensified. They are uniquely positioned to translate high-level directives into actionable steps, manage cross-functional collaboration, and serve as guardians of institutional knowledge.

Burnout begins to rise the ranks of human capital problems?

Burnout has become an operational concern, not an individual issue. Many organizations treat it with wellness apps and resilience workshops, but these are reactive measures that fail to address the root causes: challenging stakeholders, toxic leadership, and inefficient workflows. This “carewashing” shifts the burden to employees while absolving leadership of its responsibility to fix the systemic problems.

Data Point: Employees are too tired to switch

43%

Number of US workers say they’re planning to look for a new job—93% of workers said the same in 2025 according to Monster

In Other News

• Lockheed Martin CIO Says AI Is Remaking Her Role: ‘It’s got to come from a central place,’ Maria Demaree says. ‘And they’re looking to the CIO.’ (Wall Street Journal)

• Recruiters are doing more ‘legwork’ to find candidates, Glassdoor finds. (HR Dive)

• Meta is changing its performance review to reward output over effort, taking a page from Amazon and X. (Fortune)

• Approaching AI risk as the staffing industry evolves. (Staffing Industry Analysts)

• EY Study: Curious how AI will change HR? These Big Tech HR leaders have some thoughts about what to expect. (HR Brew)

• McKinsey CEO Bob Sternfels says the firm now has 60,000 employees: 25,000 of them are AI agents. (Business Insider)

• Is Your Lunch Break Now Run by AI? How Corporate-Mandated Wellness Is a Slippery Slope to Mandatory Meal Plans. (Entrepreneur)

Sent this by a friend? Sign up here to receive HCI in your inbox every week.

By Ken Stibler; Powered by Reyvism Analytics

Productivity without culture is a recipe for disaster

Many companies are dialing up productivity demands without fixing the systems that make productivity possible. Amazon’s new policy requiring weekly manager impact reports reflects a wider shift toward visible output tracking. But when organizations lack consistent expectations and working trust, documentation turns into defense, and accountability loses its edge.

Meanwhile, the old social fabric is fraying. Fewer people linger after hours. Fewer friendships form on the job. For younger employees, the absence of these informal cues leaves the workplace harder to read and harder to navigate. Culture has quietly become an operational dependency. When it is missing, performance tools lose traction, and even high performers pull back.

That’s where a sudden rise of culture coaches fits. Businesses are bringing in outside help to improve how teams make decisions, resolve conflict, and hold one another to clear standards. Culture is becoming a fixed cost of performance. Without strong norms, even the best systems break down under pressure.

Skill resilience requires pushing back against the theft of our attention (aka reading)

Our lives are increasingly flooded with tools that promise speed while quietly eroding our focus. Auto-summaries, feed algorithms, and AI assistants make it easy to consume more while understanding less. Over time, that shift is reshaping the cognitive habits behind good work. People scan, react, and move on. What they lose is the ability to stay with a hard problem and think deeply enough to solve it.

• Read more: LinkedIn Data show people are scrolling longer on the site. (WSJ)

Reading (something an increasing number of Americans don’t bother with) offers a way back. Long-form fiction and nonfiction force the brain to process complexity without shortcuts. They train attention span, narrative memory, and the ability to hold ambiguity…all essential for navigating strategic work and leadership roles. But reading for pleasure continues to fall, especially among younger men, and the muscle of sustained focus is weakening across the board.

Quote of the Week: Distance Responsibility

“You can’t explain licensing or franchising to a customer.”

— Jim Fielding, former CEO of Claire’s Stores, on why brand blowback lands even when a location is independently operated.

Reading List:

2026 ushers in a wave of new labor laws

New labor rules taking effect this month mark a broader regulatory shift. Nineteen states raised minimum wages, led by Washington at $17.13 an hour, and more workers now fall under $15-plus state floors than the federal baseline. At the same time, states are extending oversight beyond pay. Illinois expanded its Human Rights Act to cover algorithmic bias in hiring, Colorado and Texas added limits on AI use in employment decisions, and Oregon introduced stricter scheduling notice rules. The message for employers is clear. Labor compliance is now as much about systems and processes as it is about wages.

Hilton, ICE, and the new corporate crisis playbook

A Hampton Inn franchise in Minnesota became the center of a political firestorm after screenshots alleged it refused rooms to ICE agents. Hilton removed the property from its system within a day. The move was quick and decisive, but the incident revealed an ongoing vulnerability: customers do not care whether a location is franchised or company-owned. Brand accountability is absolute. In a social media environment where reputational damage can spread in hours, the margin for inaction is gone.

Even small businesses are getting CEOs security

Security spending for executives is rising, with the average disclosed off-the-job executive protection reached $112,000 in 2024, nearly double what it was four years ago. Behind the number is a structural change: event logistics are tighter. Spouses and children are briefed. Personal information is scrubbed or managed more actively. The pattern reflects a broader reality: visibility is risk, and even mid-market firms are reconsidering their posture.

Data Point: Kids Aren’t Alright

41%

Underemployment rate for recent college graduates according to New York Fed data

In Other News

• Forget an MBA: Hasbro forces workers to sit through a Monopoly-style board game to see if they’re fit for the C-suite—and it’s a tactic approved by Reid Hoffman. (Fortune)

• Fewer layoff announcements may be masking a deeper slowdown as white-collar and manufacturing hiring continues to fall. (Quartz)

• Why AI Boosts Creativity for Some Employees but Not Others. (Harvard Business Review)

• Recruiters are increasing their AI usage as pressure to hire intensifies. (HR Dive)

• An analogue native’s guide to digital success: If employers want AI to transform work, they should pay attention to history’s technological flops. (Financial Times)

Sent this by a friend? Sign up here to receive HCI in your inbox every week.

By Ken Stibler; Powered by Reyvism Analytics

Preparing for the wave of employees as retirement becomes out of reach for millions

Retirement is no longer a predictable endpoint for a growing share of the workforce. Rising living costs, uneven savings, and the erosion of pensions are pushing more Americans to work into their late seventies and beyond, not out of preference but necessity. What once looked like a fringe trend is becoming a durable labor market feature.

For employers, the challenge is not accommodation but design. Older workers often remain productive and engaged, but they bring different constraints around stamina, health, and scheduling. Firms that rethink roles, task intensity, and hours are retaining experience that would otherwise be lost, while reducing turnover costs in tightening labor markets.

The strategic implication is straightforward. As labor force growth increasingly comes from older cohorts, companies that fail to adapt will face higher hiring friction and knowledge loss. Those that redesign work for longevity, rather than speed alone, will gain a quiet advantage over the next decade.

How to train when employees’ tech moves faster than HR

AI is scaling faster than organizations’ ability to train the people expected to use it. Employees consistently say learning and development improves retention and confidence, yet heavy workloads and fragmented ownership have left training behind the technology curve. The result is a widening gap between adoption and actual capability.

“When organizations don’t set people up to use AI reliably, employees won’t trust it and won’t adopt it…That’s why HR leaders need to create space for safe learning and experimentation with AI’s uses and limits, starting with their own teams.”

—Ted F. Tschang, an associate professor of strategic management at Singapore Management University, on the AI adoption challenges facing HR

That gap carries operational risk. When training lags, employees rely on informal workarounds, overuse a small group of AI-fluent peers, or disengage from tools they do not trust. Productivity gains look strong on paper, but performance becomes uneven and fragile in practice.

Until companies treat AI literacy as core infrastructure rather than a benefit, returns on AI investment will remain uncertain. Technology adoption can move quickly, but capability only compounds when organizations create space to learn.

Quote of the Week: Retention as a Competitive Advantage

“Retention is going to be one of the most important competitive differentiators in 2026. Investing in our people isn’t just the right thing to do, it delivers real returns. High attrition, burnout and disengagement cost far more than initiatives that support employees and provide meaningful experiences.”

—Anna Lundström, CHRO at Spotify, on the company’s 2026 retention strategy

Reading List:

Is the labor market shrinking? Fed admits that we don’t know

Federal Reserve officials now acknowledge that headline job numbers may be seriously overstating employment growth due to modeling limits and data lags. If true, the labor market may be weaker than it appears, complicating hiring, wage planning, and policy decisions. For employers, confidence in workforce forecasts is becoming harder to justify.

“De-bossing” leaves employees increasingly burned out

Efforts to flatten hierarchies and remove managers are eroding employee autonomy rather than increasing it. Research shows that when workers lack clear ownership, burnout rises even in flexible environments. Autonomy without structure is proving as damaging as over-control.

Is there a right way for executives to exit?

Boards are discovering that succession planning often fails not for lack of process, but because leaders struggle to step aside. Poorly managed exits disrupt morale, delay internal advancement, and amplify uncertainty. The strongest organizations treat succession as a continuous discipline, not a last-minute negotiation.

Data Point: Modern Motivations

85%

The number of employees who prioritize remote work over compensation when considering a new job.

In Other News

• AI Is Powering Trump’s Economy, But American Voters Are Getting Worried. (Bloomberg)

• More workers say they will job hunt in early 2026, but competition is tight. (HR Dive)

• Will skills still matter in 2026? (HR Executive)

• Retail job cuts up nearly 140% from last year. (Retail Dive)

• Evolving economic conditions — not AI — will drive cautious 2026 hiring. (HR Dive)

Sent this by a friend? Sign up here to receive HCI in your inbox every week.

By Ken Stibler; Powered by Reyvism Analytics

As we wind down the year, mentally prepare for a strong start in the next

The past two years have both opened the same way: January 1 arrives, everyone hopes for a clean slate, and instead the year starts with a tired slog. The combination of layoffs, restructuring, and nonstop change meant most teams entered 2024 and 2025 depleted rather than energized. This December is no different. The rest is necessary and well deserved, but it also makes it easy to tune out the reality that the pressures shaping this past year will show up again the moment people return to work.

Peculiar Problem Preview:

• Wealthy Americans head to dollar stores as affordability pinches consumers: (Financial Times)

• The ‘forever layoffs’ era hits a recession trigger as corporates sack 1.1 million workers through November. (Fortune)

• Top consultancies freeze starting salaries as AI threatens ‘pyramid’ model. (Financial Times)

• Agents, robots, and us: Skill partnerships in the age of AI. (Mckinsey)

• Companies likely have ‘lowered their tolerance for change’. (HR Dive)

What’s waiting for leaders next year isn’t a new set of problems but the sharper version of the ones we already feel. Consumers are stretched. Companies are squeezing productivity out of AI while talent systems fall behind. Pay structures and early-career pathways are shifting while tolerance for constant transformation is falling. The pattern is familiar: expectations rise, capacity doesn’t, and the gap creates friction everywhere from hiring to retention to performance.

That’s why leaders can’t assume a reset will fix anything. The world we’re entering will demand clarity, better solutions, and a willingness to confront the issues we avoided when fatigue set in. Turning off old problems has never made them disappear, and 2026 won’t be an exception. Starting well next year depends on entering it with open eyes, not optimistic amnesia.

Leading successfully requires an increasingly odd mix of skills

Leadership has always required range, but the range required now is getting wider. New research from Fortune shows that leaders are expected to operate in two modes at once: steady enough to hold a culture together, bold enough to push it somewhere new. Leaders who once succeeded through deep expertise now succeed through adaptability and a willingness to grow at pace.

The emotional load is equally real. Leaders sit in the middle of pressures they often can’t share, and the resulting isolation can make judgment foggy and pace harder to sustain. The antidotes they describe are practical: build a portfolio of relationships you can rely on, keep a clear view of what you still need to learn, stay humble enough to keep growing, and confident enough to make the hard calls. Leaders who handle this moment well are not the ones with perfect answers; they are the ones who expand their capacity to handle uncertainty without losing clarity.

Quote of the Week: Not a good sign for SMBs

“[W]hile November’s slowdown [in hiring] was broad-based, it was led by a pullback among small businesses. Companies with fewer than 50 employees shed 120,000 jobs, the largest one-month decline since May 2020.”

— Nela Richardson, chief economist at ADP and a contributor to Bloomberg Television on how small business caution is showing up in cuts.

Reading List:

AI is ‘de-skilling’ employees

AI is allowing employees to move faster, but it is also eroding the very learning process that creates competence. Workers who depend on the tool too early skip the hard thinking that builds judgment, and the result is a widening gap between output and understanding. People across functions now default to AI for decisions they once reasoned through themselves, weakening their ability to assess, verify, or challenge the answers they receive. Leaders who treat AI as a simple productivity gain risk building teams that can execute quickly but struggle the moment independent thought is required.

Are managers responsible for “parenting” employees?

Managers are now being asked to intervene in problems as fundamental as handwashing, a sign of how far workplace norms have slipped. When employees look to leadership to correct behavior that belongs squarely within basic adult responsibility, it signals a deeper reluctance to address simple issues directly. This upward escalation turns managers into custodians of everyday conduct and diverts attention from the real work of performance and culture.

Remembering how to do the office holiday well

From companies HCI has spoken with recently, it anecdotally seems like the company Christmas party is back in a major way this year. As fun as it is, it also brings back risks many have forgotten as alcohol, fatigue, and looser social boundaries mix. Basic courtesy and genuine appreciation build trust quickly, while careless behavior can undermine it in moments. The season offers rare chances for authentic connection, but those moments go to people who show restraint, awareness, and an understanding that professionalism does not take the night off.

Data Point: Efficiency trumps risk

65%

Percentage of talent acquisition leaders who say they’re implementing AI in the hiring process (despite ongoing concerns of bias and liability)

In Other News

• Learning to lead in a world of spiralling complexity. (Financial Times)

• Talent development pros want more training, too, research shows. (HR Dive)

• The New, In-Demand Job Skill: Being a TikTok Influencer for Your Company. (Wall Street Journal)

• Employees Call Workplace Nepotism Widespread and Damaging to Morale. (Inc)

• Does working from home really kill company culture? (The Economist)

• SHRM gets sued: When litigation raises tough questions about culture. (HR Executive)

• How tech broke the job market: Applying to a job in 2025 is the statistical equivalent of hurling your resume into a black hole. (Business Insider)

Sent this by a friend? Sign up here to receive HCI in your inbox every week.

By Ken Stibler; Powered by Reyvism Analytics

What does putting people at the center of modern organizations look like?

Most companies talk about being people centered, but very few operate that way when real decisions are on the line. As many CEOs push back against the incessant drag of “AI-ifying” everything, several conversations lately have centered around what people-focused organizations look like at this point.

BCG has done good work here: their research finds that people-centered orgs starts by placing their people lead at the center of strategy, instead of treating HR as the cleanup crew for decisions already made. When the CPO helps design how AI is introduced, how jobs are restructured, and how trust is protected, people become the starting point for transformation rather than an afterthought.

In practice, this means managing change with clarity and consistency. Employees need to understand why new tech is being used, what its guardrails are, and how their roles will evolve. Organizations that communicate this clearly and build real capability around new tools generate enthusiasm instead of anxiety. The result is a workforce that can adapt quickly because people know how they fit into the future.

True people centricity also requires cultures that can sense and respond to change without waiting for disruption. Cross-functional collaboration, protected learning time, and bottom-up problem solving create the conditions for continuous adaptation. Leaders who build these systems show that people are not a risk to be contained but an asset to be developed, and that is what makes the organization modern.

Adapting to continuous change is driving more leaders to call it quits

CEO departures are rising sharply regardless of company success, the causes are many but the underlying driver is that the job is increasingly defined by nonstop reinvention. After years of managing through the pandemic, supply shocks, political volatility, and the rapid arrival of AI, many long-serving CEOs have exhausted the runway. Many now see uncertainty as permanent, and are turning over leadership to execs better suited to handle continuous change.

• Continuous adaptation: Why organizations must think beyond ‘resilience’ and ‘agility’. (World Economic Forum)

For many CEOs, the personal signals that their hearts aren’t in it arrive before the formal ones. Leaders find themselves avoiding new technologies, feeling detached from the work, or dreading the weekly reset that used to energize them. When the role demands constant adaptation and the prospect of stability never returns, stepping aside becomes a rational choice rather than a retreat.

Quote of the Week: Transformation is more than change

“Business transformation is about changing how we all as humans are doing our work, and therefore HR is an incredibly important enabler to create the flexibility to learn and evolve, but also to chart the course.”

—Katy George, VP of workforce transformation at Microsoft, on the evolving partnership between IT and HR amid the AI transformation of business

Reading List:

The math of why you can’t focus

Your workday is defined by three factors: how often you are interrupted, how long it takes to recover, and how much uninterrupted time your work requires, new research finds. Even small increases in interruptions or recovery time can collapse your capacity for deep work. In most workplaces, this math is stacked against employees. Focus is not a matter of discipline. It is a function of system design, and many environments are engineered to destroy it.

Leadership and employees are diverging on AI, that matters for all employee’ engagement

Executives assume their people are excited about AI, but employee sentiment tells a different story, Harvard Business Review. Surveys show 76% of leaders believe workers are enthusiastic about AI adoption, while only 31% of employees agree. This gap matters because trust drives adoption. Workers embrace AI when it makes their jobs more secure and more capable, not when it feels like a replacement strategy. Transparent communication about how AI is designed, governed, and used is now a prerequisite for engagement.

A free tool for a leadership boost: appreciation

One of the most effective leadership tools costs nothing. Genuine appreciation increases engagement, strengthens trust, and improves performance far more reliably than incentives or perks. People interpret appreciation as evidence that their work is seen and valued. In environments overloaded with change, attention, recognition, and small acknowledgments have disproportionate impact. Leaders who practice consistent appreciation build teams that stay motivated when the pace intensifies.

Data Point: 40 hours a week?

53%

The number of employees working more than the standard 40 hours a week, while 40% work less than that.

In Other News

• Blended teams: From stopgap to strategic advantage. (WorkLife)

• Big law firms risk losing talented staff over ‘unmanageable’ stress: Two in five plan to leave jobs within five years. (Financial Times)

• Work-life balance finally outranks pay as a top motivator for job seekers, but CEOs aren’t sold. (Fortune)

• Slack cofounder says workers and CEOs can get stuck doing ‘fake’ work like pre-meetings and slide shows. (Fortune)

• MIT study finds AI can already replace 11.7% of U.S. workforce. (CNBC)

• AI Is Writing Performance Reviews. What Could Go Wrong? JPMorgan Chase & Co. has blessed the practice. (Bloomberg)

Sent this by a friend? Sign up here to receive HCI in your inbox every week.

By Ken Stibler; Powered by Reyvism Analytics

Tired and skeptical, employees stand still as leaders push change

Change fatigue is setting in. Nearly two-thirds of U.S. workers experienced at least one organizational change in the past year, yet a third say their companies changes weren’t worth the effort, according to Eagle Hill Consulting. Employees see benefits in efficiency and collaboration but feel burdened by execution: only one in four believe their organization manages change effectively. Workloads and stress rose for nearly half of respondents, and most said managers failed to remove existing responsibilities to make room for transition.

The data reveal what many leaders overlook: employees can accept new tools or structures, but they reject poorly timed or ill-communicated shifts that feel detached from purpose. Employees are twice as likely to view product launches or technology upgrades as positive compared with culture shifts or return-to-office mandates. The best-received changes are those that stay within the “9-to-5” boundary rather than spill into personal life.

Eagle Hill’s CEO Melissa Jezior calls the problem one of method, not motivation. “The key to successful change is not just what you change but how you change.” Companies that pace transitions, tie them clearly to purpose, and equip mid-level managers as change leaders are likelier to sustain adoption. Without that, fatigue compounds and transformation stalls.

Recruiters get more efficient, but talent quality is still declining

Recruiters are handling record applicant volumes yet finding fewer candidates worth hiring. Nearly two-thirds say applications have surged this year, but much of that increase reflects desperation rather than depth. Employers report a flood of low-fit résumés and candidates leaning on automation tools to mass-apply.

The strain is prompting recruiters to rethink their funnel rather than simply widen it. Many are rebuilding sourcing pipelines, re-evaluating job criteria, and upgrading systems to filter better rather than faster. Yet the underlying issue runs deeper: too many candidates lack the adaptability and judgment modern roles require. The efficiency gains of recent years have only exposed how fragile the connection has become between hiring velocity and hiring quality.

Quote of the Week: Yesterday’s Success

“There’s nothing more dangerous than yesterday’s success. You can leverage it and learn from it, but I focus on the future and how to drive success for our employees and our workmates and our customers.”

— Workday CEO Carl Eschenbach

Reading List:

Why don’t we measure trust?

Executives consistently rank trust among the top qualities of effective leadership, yet few measure it with any rigor. While diagnostic tools now exist, from neuroscience-based organizational trust indices to leadership behavior surveys, most firms still treat trust as a feeling rather than a metric, the Harvard Business Review reports. Unmeasured trust leaves leaders blind to early signals of disengagement and reputational risk. The organizations now building trust dashboards and embedding behavioral measurement into performance systems are turning trust from a virtue into a competitive advantage.

Performance management suffers from a lack of clarity

Nearly half of organizations say performance management could lift productivity, but only one in five believes managers deliver feedback effectively. Research shows that inflated ratings, unclear goals, and inconsistent coaching continue to weaken these systems. Many firms are experimenting with AI to streamline reviews and goal setting, but the real differentiator remains human clarity that defines what excellence looks. Simplified scales, skills-based evaluation, and feedback training can restore credibility to a process most employees distrust.

How to manage perfectionists

Some employees undermine productivity not through neglect but overcommitment. The problem stems from workers applying luxury-level standards to mass-market work, redoing tasks, rejecting adequate output, and driving up costs, Inc reports. When excellence becomes inefficiency, leaders must intervene with absolute clarity about expectations and consequences. The lesson is not to reward indifference but to realign ambition with purpose. Quality matters only when it serves the right standard at the right scale.

Data Point: Spiraling

45%

The number of workers feel in control of their careers right now, as uncertainty from layoffs, a cooling job market, and AI transformation permeate their work lives.

In Other News

• How the U.S. Economy Has Defied Doomsday Predictions on Tariffs. (Wall Street Journal)

• Walmart CEO said paying its star managers upwards of $620,000 yearly empowered them to ‘feel like owners’. (Fortune)

• The future of work is still human: Why we may be investing too much importance in the role of technology. (Financial Times)

• The practice of ‘labor hoarding’—holding on to employees for fear of not being able to get them back later—has reached its end. (Wall Street Journal)

• Over one-third of companies plan to replace entry roles with AI, survey says. (HR Dive)

• Citi’s Ryan: Employee buy-in on AI will yield ‘innovation dividend’. (CIO Dive)

• AI could save employees a full day of work per week — if they get training. (HR Dive)

• To boost AI adoption, CIOs lean on training, guardrails. (CIO Dive)

Sent this by a friend? Sign up here to receive HCI in your inbox every week.

By Ken Stibler; Powered by Reyvism Analytics

Three better ways to think about the recent AI layoffs

I’m tired of those two letters and you’re probably even more tired of it. We’ve covered what Fortune is pleasantly terming “mega AI layoffs” several times this fall, and it’s gotten to the point where it just feels like background noise. Add in the contradictions between amazing claims of what the tech can do and regular studies showing most companies are seeing no results and it’s easy to want to put your head in the sand.

Yet the instinct to wait for the dust to settle is a dangerous mistake if the tech is even 50% as disruptive as powerful as claimed. So instead of recapping all of this week’s AI-layoff stories and the resultant HR freakout that its generating (which might have something to do with the fact IBM claimed its automated 94% of all HR tasks), here are three less hype-driven frames to keep yourself engaged with the topic:

1. Competitiveness. Instead of fixating on AI, focus on the competitive reality it creates. Clients are already demanding that the cost savings from automation be passed through to them. Deloitte and others are seeing that pressure firsthand, and companies that can’t deliver will lose business to those that can.

2. Technological maturity. The question isn’t whether AI works—it’s whether your organization is ready for it. Do you have the data, people, and strategic clarity to use it effectively? Many of these layoffs are more about Wall Street signaling than operational need, an effort to prove adoption before the foundations are even in place. That’s a fast path to failure.

3. Culture and key person dependency. When leaders link job cuts to AI, they might win short-term investor applause but lose long-term loyalty. The employees who remain become more vital and less trusting. Amazon’s billion-dollar training plan may not be enough to rebuild morale after celebrating automation so loudly, and even cautious leaders now face teams that are already anxious about what comes next.

Bottom line: engage with the real market shifts - as leaders - rather than worrying your way to inaction thinking about the tech itself.

Successful AI adoption is a people problem

For all the talk about AI transforming business, the real challenge lies with the people expected to use it. Across industries, most employees still haven’t received the training needed to apply AI in their work. Leaders talk about integration and productivity, but many workers are still waiting for clear direction. That disconnect between ambition and ability will determine whether AI drives progress or frustration.

The companies making headway are the ones involving employees directly in the process. They create opportunities for hands-on learning instead of treating AI like an abstract system to be adopted later. People learn faster when they experiment, share what works, and see results in their own roles. When learning becomes part of daily work, AI adoption starts to feel natural rather than forced.

Clear leadership is equally important. Employees don’t need motivational speeches about the potential of AI. They need honesty about what is changing, what will stay the same, and how they will be supported. Straightforward communication and visible investment build trust, and trust encourages participation. The real measure of success with AI won’t be the speed of automation but how deeply leaders engage their people in shaping what comes next.

Quote of the Week: Tool abuse

“These things are tools. They’re neither good or bad, inherently—it’s what we do with them. Overuse is an issue. I don’t think the phone is a problem. I think the amount of time we stare at a phone is a problem.”

— Airbnb Founder Brian Chesky on employees overuse of phones during meetings

Reading List:

Chiefs of Staff quietly rise to prominence in corporate structures

Once reserved for politics or the military, the chief of staff role has become a cornerstone of corporate leadership, with nearly two-thirds of Fortune 500 CEOs employing one. Chiefs of staff act as filters, strategists, and confidants—trusted to manage priorities and absorb daily pressure so executives can focus on long-term goals. As AI takes over routine work, their blend of emotional intelligence, discretion, and influence behind the scenes makes them indispensable to modern executive teams.

CEOs struggle with ever growing generational friction

Despite a brutal job market, younger employees are still pushing back against corporate norms, and annoying executives in the process. Many are refusing to treat every project like a life-or-death sprint, questioning why office jobs run on constant adrenaline when so little of it is “truly urgent”. The shift amid a rapid replacement of younger workers shows either ignorance to their true vulnerability, or a deeper divided by work-life balance vs decades of management habits built on speed, pressure, and visible grind.

Surge of state AI rules feeds small business compliance concerns

A wave of state-level AI legislation is leaving small businesses anxious about compliance costs and legal risk. Nearly two-thirds of small business owners now say overlapping state rules threaten growth, prompting calls for a unified national AI framework. As the Trump administration weighs withholding federal funding from states with stricter laws, the patchwork of regulations risks stifling innovation before federal policy catches up.

Data Point:

49%

The share of workers who believe working in office is critical for promotion, regardless of RTO status.

In Other News

• Books, malls and cars: where the physical world still rules: Many consumers are resisting, even turning back the digital revolution. (Financial Times)

• Middle managers are getting exorcised from org charts. (HR Brew)

• A good employee leave experience can pay dividends in retention, report finds. (HR Dive)

• Massachusetts employers are now required to share salary ranges. (HR Brew)

• AI generates surge in expense fraud: Business software groups warn that top AI models are increasingly being used to create ultra-realistic fake receipts. (Financial Times)

• Job huggers’ are a new cybersecurity problem: Disengaged employees are more likely to fall for phishing emails and report security issues too late. (IT Brew)

• America’s flatlining income growth is hitting Gen Z the hardest, throttling their shot at homeownership, JPMorgan report warns. (Fortune)

Sent this by a friend? Sign up here to receive HCI in your inbox every week.

By Ken Stibler; Powered by Reyvism Analytics

Are we leaving our employees behind?

The pace of change has outstripped human wiring. Brené Brown warned last week that “people are not okay,” describing how workers’ brains simply aren’t built for nonstop disruption. Her comments echo new findings from Adecco and HR Dive: while most executives are confident about AI adoption, barely a third of individual contributors use AI at all, and even fewer understand how it affects their jobs.

The gap is growing. Executives say they are “future ready,” but 65% of front-line workers are unsure what that even means. Adecco found that only 37% of employees qualify as future, yet almost three in four say AI is already changing the skills they need. Perceptyx found that fewer than half of individual contributors trust their organizations’ AI decisions, and most report little training or communication about how automation will reshape their roles.

Brown’s point was simple: instability, political, technological, and economic, is testing the limits of mental resilience. Workers are looking for certainty in a world that no longer offers it. Research from i4cp and HR Executive shows that only a third of organizations view change as manageable, while another third describe it as threatening or overwhelming. The difference between low and high performers, said i4cp’s Kevin Oakes, is mindset: strong companies treat disruption as normal, not existential.

Agility is quickly becoming a key predictor of performance. But agility requires clarity, skill-building, and trust, three things in short supply. Leaders who ignore these gaps risk leaving their people behind in the very transformation they are trying to lead.

A jobs crisis is brewing

Automation is moving faster than policy or training can keep up. Amazon is now planning to replace more than half a million workers with robots by 2033, automating 75% of its operations and saving roughly $12.6 billion over two years. Tesla and PharmAGRI are already deploying 10,000 humanoid robots in manufacturing and pharmaceuticals, while Uber is paying drivers to train the AI models that may one day replace them.

Meanwhile, Gallup reports that only 4 in 10 American workers hold what it defines as a “quality job,” one offering fair pay, stable schedules, and a path for advancement. Those with quality jobs are twice as likely to report high satisfaction and better health, yet half of U.S. employees say they have received no training or development opportunities in the past year. The convergence of automation and underinvestment in skills is creating a quiet crisis: more technology, but fewer good jobs.

While this may sound like a problem for policymakers, everyone is going to bear the brunt as government toppling protests led by unemployed GenZ in Nepal, Madagascar, Peru and an increasing number of countries.

Quote of the Week: A new need for leaders

“People are emotionally dysregulated, distrustful, and disconnected. If you’re leading people, you probably know they’re not okay.”

— Brené Brown, speaking at Fortune’s Most Powerful Women Summit

Reading List:

Employees increasingly avoid taking vacation days

Eighty-two percent of U.S. workers have paid time off, but nearly one in four did not take a single vacation day last year. Surveys show heavy workloads and unsupportive managers are keeping people from resting. One in four say their manager discourages full weeks off, and many fear that unplugging signals a lack of commitment. Companies that treat PTO as a formality, rather than recovery, are seeing higher burnout and lower retention.

Active laziness as a management skill

Top executives are learning that real productivity requires intentional rest. The best leaders, says a Fortune coach, practice “active laziness,” short breaks, breath work, naps, and time outdoors that restore focus instead of draining it through mindless passive recovery. Learning to recover as deliberately as you work can raise energy, creativity, and resilience. Stress management, it turns out, is now a leadership skill.

Small businesses set to struggle with runup in healthcare costs

Obamacare subsidies are once again at the center of a political standoff in the current shutdown. If temporary pandemic-era expansions expire, premiums for small business owners and the self-employed could more than double. Roughly half of adults covered by the ACA are freelancers or small employers. KFF estimates that a 60-year-old couple earning $85,000 would see annual premiums rise by $22,600 in 2026. With margins already thin, many small firms say higher health costs could force layoffs or closures

Data Point:

37%

The share of workers considered “future ready” in 2025, up from just 11 percent last year, according to Adecco.

In Other News

• How can we avoid being scammed? As chief financial officer of a family business, I feel we are at risk. (Financial Times)

• Middle Managers Feel the Least Psychological Safety at Work. (Harvard Business Review)

• Trump immigration plan may wipe out 15M jobs by 2035, study claims. (Axios)

• How Americans are feeling about their chances on the job market, according to an AP-NORC poll. (AP)

• ‘My Employees Can’t Take Feedback Without Getting Defensive’. (The New Yorker)

• US Chamber sues White House to block ‘plainly unlawful’ H-1B visa fee. (HR Dive)

Sent this by a friend? Sign up here to receive HCI in your inbox every week.

By Ken Stibler; Powered by Reyvism Analytics

Humans (increasingly) no longer required

Corporate restructuring is accelerating as more companies move from pilot AI projects to full-scale adoption. Amazon is planning to replace 600,000 workers by 2027, Goldman Sachs has begun a full AI-driven reorganization, and similar stories are becoming a daily reality. Across sectors, the same pattern is emerging: efficiency gains from AI are actually replacing the need for large teams of people. Even in startups hiring is rapidly falling, leaving small and medium sized businesses the human-dependent businesses in an increasingly automated world.

Executives say the future workforce will look less like a triangle and more like a barbell, with more individual contributors, fewer middle managers, and a handful of leaders overseeing increasingly technical teams. Companies like Moderna are merging HR and IT functions entirely, while banks such as Citi and JPMorgan Chase are embedding AI into every process from client onboarding to code reviews. JPMorgan alone reports over one million AI-automated code reviews this year, freeing 100,000 developer hours each week.

But the human cost is real. Entry-level roles are disappearing, and organizations that skip retraining risk hollowing out their own talent pipelines. Surveys show nearly half of executives see AI primarily as a headcount-reduction tool rather than an enabler of skills development. As more companies turn to agentic AI systems to execute multistep tasks, the workforce itself is being rewritten: leaner, faster, and more dependent on machines.

The strategic question for leaders is starting to shift from how to add AI to how few humans are still needed to make it work. For smaller businesses: make sure you’re studying and stealing from the expensive and hard-won tactics of big companies’ AI efforts.

… yet companies struggle to land AI skills

Even as they cut staff, companies are racing to hire the few people who can make AI actually deliver. Former Apple CEO John Sculley admits the company’s failure to adopt AI has created its first competitive challenge in decades.

Ralph Lauren has elevated AI to the C-suite, and Citi now requires prompt training for most employees. Yet demand far outpaces supply: Indeed’s latest research finds 41% of all job skills are now exposed to AI transformation, but only 13% of organizations have mature governance and deployment standards in place.

Banks have led the way. Evident Insights reports AI headcounts at major financial institutions grew five times faster than total hiring last year. Capital One alone added over 2,000 AI professionals, while JPMorgan continues to recruit aggressively from Big Tech. Still, 35 percent of tech workers fear AI could replace their roles, and many say they’re not getting the training they need to adapt.

The result is a paradox: firms have the tools to automate, but not the talent to deploy them safely or effectively. AI can transform work, but without human fluency and governance, transformation is just turbulence.

Quote of the Week: Success with AI is dependent on people

“AI represents an enormous opportunity for businesses globally, but as they chase greater productivity and efficiency, we must not lose sight of the fact that it is ultimately people who power progress.”
— Susan Taylor Martin, CEO of the British Standards Institution

Reading List:

Pockets of shortages prompt teenager training pipelines

Labor shortages are prompting companies to look further down the age curve, the WSJ reports. Across the U.S. and Europe, manufacturers and logistics firms are launching high school apprenticeship programs to fill technical roles before they disappear entirely. Germany’s dual-education model is now being studied by U.S. policymakers as a template for bridging skill gaps in advanced manufacturing and robotics.

Simple fixes to be better at complex management

Complex management problems often have simple human fixes. A ten-year study of 200,000 employees and 30,000 managers found that the best leaders were those who placed people in roles that matched their strengths, not those who managed the most projects or meetings. Employees who worked under top managers were 40% more likely to move laterally within seven years, earned 13% more, and achieved 16% higher performance. These leaders spent more time in one-on-one meetings, spotting talent and coaching, while poor managers defaulted to micromanaging and drained morale.

Revisiting the value of culture hires and “glue” employees

As organizations flatten and automate, “glue people” who connect teams are becoming both rarer and more valuable, the Wall Street Journal reports. These employees (often informal communicators or cross-functional coordinators) carry much of the social load that keeps hybrid teams aligned. But they are also the first to be overlooked in data-driven talent reviews. Replacing them with tools erodes trust faster than leaders realize. The lesson: what AI optimizes, culture must still sustain.

Data Point: Pools of Reality Amid a Sea of Hype

52%

Number of survey respondents that reported worker reassignment due to AI adoption, while 26% said talent was laid off due to AI.

— Indeed 2025 survey on workforce transformation

In Other News

• The New Executive Challenge: Conquering White Space. (Arte Coach)

• Learning leaders need to know how to pick tech, report says: “If we don’t develop the adjacent IT skills to help make those decisions, someone else will make those decisions for us,” one learning officer said. (HR Dive)

• The hidden risks of AI in training. (HR Mag)

• Furloughed Federal Workers Turn to Side Hustles to Survive Shutdown. (Wall Street Journal)

• Nearly all workers believe in title inflation — and most say it’s on the rise. (HR Dive)

• Forcing employees to return to the office often backfires, research shows. In this video, learn four better approaches to bringing teams together. (Sloan MIT Review)

• 6 things HR leaders must know about agentic AI before investing. (HR Executive)

• Deloitte AI debacle seen as wake-up call for corporate finance. (CFO Dive)

Sent this by a friend? Sign up here to receive HCI in your inbox every week.

By Ken Stibler; Powered by Reyvism Analytics

Culture or skills? What’s the best antidote for uncertainty?

Leaders are discovering that resilience in a volatile environment is not built through skills alone. It depends on culture. Yet as technology and uncertainty reshape work, most organizations are struggling to balance the two. Brené Brown told HR leaders recently that “organizations have no core,” relying on the wrong “muscles” to manage disruption. Her point was simple: companies are trying to address systemic change with outdated behavioral foundations.

A strong corporate “core,” she says, is made up of emotional intelligence, accountability, and systems thinking, the traits that enable agility. But Gartner’s latest CHRO survey found that less than half believe their culture actually drives performance. Meanwhile, LinkedIn data shows that 71 percent of leaders would rather hire a less experienced candidate with AI skills than a seasoned one without. The result is a dangerous imbalance: culture without skill is soft, but skill without culture is brittle.

Skills-first hiring has major benefits. It expands candidate pools up to 20 times and improves hiring accuracy by 12 percent. But as HR leaders rush to automate screening and assessment, many risk hollowing out the “human” side of human resources. The next advantage will come from combining both. Teams that are technically adaptive and emotionally grounded will outperform those focused only on one side of the equation.

The tension between culture and skill will define the next decade of talent strategy. The organizations that succeed will not choose between them. They will fuse them.

The growing risk of AI “workslop”

A new problem is spreading through offices: “AI workslop.” The term, coined by Stanford’s Social Media Lab and BetterUp, describes work that looks polished but adds no value. Or worse in the case of Deloitte this week, which admitted AI hallucinations had ended up in a $290,000 report for the Australian government.

Forty percent of white-collar employees say they have encountered it in the past month, and more than half admit to producing it - your employees are very likely doing the same. For a 10,000-person company, that reportedly translates to about nine million dollars a year in lost productivity.

The research identifies two types of workers. “Pilots” use AI to enhance creativity and precision. “Passengers” use it to avoid work altogether. The more passengers an organization has, the greater the hidden cost in wasted time and frustration. Colleagues report annoyance, confusion, and loss of trust toward those sending low-quality content.

The solution is not banning AI but building a culture of thoughtful use. Managers should teach critical evaluation, define quality standards, and reward judgment and originality. If organizations fail to do that, automation will not bring efficiency but confusion.

Quote of the Week: Who’s responsibility is the “build”

“A majority of leaders surveyed said training is mostly the responsibility of workers, with 6 in 10 saying employers hold at least some responsibility. But while 80% of leaders said they offer adequate training the number of workers that agree is falling rapidly.”

— Research from training firm General Assembly

Reading List:

CEOs struggles prompt rethinks of the the role

CEO departures have hit the highest level ever recorded this year, and many boards are questioning whether a single person can handle the growing complexity of the role. Some firms are testing co-CEO structures, such as AlixPartners, whose leaders credit trust and “pre-planned forgiveness” for making shared authority work. Analysts say AI-driven transformation, board pressure, and constant disruption have made the job almost impossible to sustain alone. The CEO role is evolving from individual heroics to collective leadership, and that may be the only way forward.

The job market is teetering, but companies still struggle to hire key skills

Despite widespread layoffs, companies are still struggling to hire for critical skills. Eighty-four percent of hiring managers say they will pay premiums for expertise in AI, data, and analytics. Yet many roles remain unfilled as employers hold out for elite talent, widening the gap between specialists and everyone else. The lesson is clear: hire for learning, not perfection. Companies that prioritize adaptability and training will fill gaps faster than those chasing a shrinking pool of technical stars.

Maturing AI adoption comes with impressive output - and increased cognitive fatigue

AI adoption is producing both gains and strain. Productivity has improved, but so has exhaustion. KPMG found that “cognitive fatigue” has replaced “fear of automation” as the dominant workplace feeling. Some executives, like MasterClass founder David Rogier, say AI has given them back an entire workday each week. Others, however, are struggling to keep pace. For most employees, it has become another layer of complexity. The divide between empowered and overwhelmed workers is widening. Without clear communication, pacing, and training, leaders risk burning out their teams before realizing the benefits of transformation.

Data Point: Not exactly passing

8%

The number of HR managers in a recent survey that view GenZ as ready for the workplace

In Other News

• When Authentic Leadership Backfires. (Harvard Business Review)

• Without data centers, GDP growth was 0.1% in the first half of 2025, Harvard economist says. (Fortune)

• When You’re the Executive Everyone Relies On—and You’re Burning Out. (Harvard Business Review)

• Is prompt engineering dead? One expert describes what HR should focus on instead. (HR Executive)

• Most Work is Translation: And LLMs are the first universal translators for work. (ACD)

• Employers report tightened social media policies in wake of political upheaval. (HR Dive)

• 71% of Workers Untrained in AI as Adoption and Expectations Surge. (Stock Titan)

• From 0 to $1.25B: How Linear grew without over-hiring. (Rippling)

• SHRM: 15% of US jobs at heightened risk of automation. (HR Dive)

• ‘We are going to destroy jobs faster than we can replace them’: The CEO whose 80% stock plunge personified the dotcom bubble on AI’s impact. (Fortune)