The majority of C-suite and talent leaders (97%) agree that adopting technology has enhanced talent attraction, engagement, and retention, an eight-point increase since 2023, according to the latest Talent Trends Report by Randstad Enterprise.

Among all the technologies organisations invest in, AI search and match has grown the most year-over-year. Two-thirds (66%) of talent leaders report making such investments—an increase of 14% since 2023.

According to the report, employers now recognise the critical role of AI in reshaping human intelligence and its productivity across every aspect of the talent life cycle, from talent acquisition, where generating job descriptions with AI is commonplace, to advancing internal talent mobility and skills matching for talent already within the business.

Beyond technology, the two top challenges talent leaders expect to face moving forward are skills-based: increased competition for hard-to-find skills (34%) and growing scarcity of speciality skills (32%). This supports the increasing desire of most organisations (80%) to move to a skills-based hiring approach. This sees employers focus on pinpointing the essential skills needed for a position and selecting candidates based on their demonstrated competencies without prioritising formal educational qualifications.

When it comes to evaluating candidates, skills-based considerations also top the list. The top three for all candidates include the potential to learn to grow (83%), intellectual or personality traits (80%), and personal motivations and aspirations relevant to the position (80%). 

Critical thinking and emotional intelligence are also highly valued when hiring (82% for senior-level candidates and 80% for early-career candidates). These traits were more highly regarded than previous employment in the industry and college degrees, indicating that many companies are moving toward a skills-based workforce model.

Mike Smith, chief executive at Randstad Enterprise, said, "We are now in an age in which artificial and human intelligence can together achieve an optimised workforce unlike any before it. Innovation, ideation, and productivity have never been more accessible. But the questions business leaders are asking are: 'Can we unlock human potential further with AI empowerment? And, how?'. Our research underscores the urgency for businesses to adopt innovative strategies to harness human potential with AI as its co-pilot and ensure agility in a rapidly transforming global employment market."

The research also found that while talent leaders voice some concerns around AI, like a reduced human touch in the workplace (34%) and the risk of amplifying bias or using technology irresponsibly (32%), the benefits outweigh the risks. Overall, 78% say AI can effectively identify opportunities for internal mobility. In comparison, 78% also believe AI can find needs and gaps within their workforce.

Meanwhile, 72% of leaders report an increasing skills gap, substantially challenging organisational growth. Notably, this is the highest score since before the pandemic in 2019.

Randstad Enterprise noted that with 80% of companies moving towards a skills-based model, there's a clear focus on developing a more adaptable and resilient workforce.

The report included responses from more than 1,000 C-suite and human capital leaders across 21 markets globally.