As we look toward 2025, one thing is abundantly clear: employee experience has become a critical differentiator for companies aiming to thrive in the future of work. Businesses are no longer judged solely by their financial success or market share, but increasingly by the experiences they offer their employees—from the moment they apply for a role to the day they leave the company. 

Cecelia Herbert, Workplace Behavioural Scientist at Qualtrics, has spent years studying the nuances of employee engagement and experience. In an exclusive interview with People Matters, she offers a timely and data-driven perspective on the trends shaping employee experiences and what leaders need to prioritize in the coming year to stay ahead.

Australia’s Employee Experience Challenge

Australia’s employee experience has consistently ranked lower than global averages, and 2025 is proving to be no different. According to Herbert, a critical differentiator for Australian workers is their shorter horizon when it comes to staying with their current employers. “Australian employees report a much lower intent to stay with their employers for more than three years—52% in Australia compared to 64% globally,” she explains. This reluctance to commit long-term, paired with a general downward trend in most employee experience metrics, signals significant challenges for Australian companies.

One of the most concerning findings, according to Herbert, is the marked drop in inclusion scores. In 2024, this drop became the most significant shift in the data. “If this trend continues, the impact on both Australian employees and businesses could be disastrous,” she warns. Leaders in Australia need to dig deeper into the cultural factors contributing to these shifts and address them proactively. Simply benchmarking against global trends is not enough—organizations must focus on understanding and responding to the specific needs of their workforce.

Addressing Low Engagement and Retention

A perennial challenge for organizations worldwide is low employee engagement and retention rates, but Herbert advises leaders to focus on what really drives engagement rather than surface-level metrics. “Employee engagement is a powerful predictor of sustainable productivity. It shows how connected people feel to the organization’s goals and their capacity to strive towards them,” she explains.

In Australia, the top drivers of engagement have been remarkably consistent over the years, centering on employees’ access to effective systems and processes, as well as their ability to envision a positive future in terms of career growth and social impact. However, Herbert cautions against chasing global best practices blindly. “While it’s interesting to compare, it’s far more useful to focus on understanding what your teams need to feel more connected, engaged, and productive at work.”

One clear message that comes out of Qualtrics’ research is that employees are feeling overwhelmed by constant change in the workplace. Herbert puts it succinctly: “Employees are telling their bosses, ‘Stop bringing more change into the workplace and focus on helping me get my work done.’” Leaders must pay attention to this call and work to reduce complexity rather than introducing more change without considering its impact.

The Relentless Pace of Change

Despite technological advancements and refined work practices, change management continues to be a stumbling block for many organizations. The constant demand for more productivity in less time is taking a toll on workers. According to Herbert, “Nearly 40% of Australians say they feel under pressure to increase productivity, largely due to the relentless pace of change.”

One of the key issues Herbert highlights is the gap between human adaptability and the inflexible systems and processes that companies use. “People are excellent at adapting to change, but the systems they work with often aren’t. In fact, many of the quick-fixes intended to address productivity issues only end up increasing complexity and chaos,” she explains.

Heading into 2025, employers need to recognize that the rate of change is unlikely to slow down, particularly with the growing adoption of AI. “We’re seeing people begin to reach a breaking point. Organizations need to step up and support their employees, ensuring they have the tools, environments, and processes they need to thrive in this rapidly changing environment,” Herbert advises.

Engaging and Retaining Gen Z

While Gen Z workers are highly engaged and motivated, they continue to exhibit low intent to stay with their employers. However, Herbert is quick to clarify that low intent to stay doesn’t necessarily indicate dissatisfaction. “Younger workers today have different career aspirations and shorter career horizons compared to previous generations. Low intent to stay doesn’t mean they’re disengaged, unhappy, or lazy—it’s quite the contrary,” she says.

Rather than lamenting this generational shift, Herbert suggests that organizations focus on maximizing the time they have with younger employees. “The best organizations are finding ways to engage and enable their talent while they’re with the company. This means offering opportunities for growth, creativity, and skill development—creating an environment that captures their enthusiasm and nurtures their potential,” she explains.

Organizations that succeed in retaining Gen Z talent will be those that shift their approach from expecting long-term loyalty to fostering short-term engagement and maximizing the impact these younger employees can have while they’re part of the team.

The Broken Candidate Experience

While onboarding has typically been a focus for organizations looking to improve employee experiences, Qualtrics’ research shows that the candidate experience—applying for a role and interviewing—has emerged as one of the weakest links in the employee lifecycle. “It’s not the onboarding experience that’s broken; it’s the entry experience for candidates,” Herbert says. “Employees are often coming into organizations after a poor candidate experience, and that puts them at a disadvantage before they’ve even started.”

The negative effects of a subpar candidate experience can reverberate throughout an organization. “Candidates and former employees influence others’ opinions about the company. A poor candidate experience can damage your reputation, and candidates who join after a negative experience may already be disengaged from day one,” Herbert explains.

To address this issue, Herbert recommends that organizations take a more data-driven approach to understanding the candidate journey, analyzing feedback from employees to identify the factors that contribute to poor experiences. “By understanding the differences between those who stay and those who leave, and gaining a deeper understanding of the entire employee journey, organizations can make more informed decisions to improve engagement and productivity,” she advises.

Balancing Short-Term Productivity and Long-Term Trust

With the continued pressure to increase productivity, leaders need to be cautious about eroding long-term trust with their employees. “Going into 2025, it’s reasonable to expect the pressure to increase productivity will only continue. That’s why it’s crucial to take proactive steps to manage the impact this pressure has on the workforce,” says Herbert.

Building and maintaining trust in the workplace requires a deliberate focus on people, feedback, and decision-making grounded in employee experience data. Herbert outlines three key practices leaders can adopt to build trust:

• Prioritize people: “There’s no trade-off between people and profit—they are one and the same. Demonstrating trust and care for people is critical in building trust between leaders and their teams.”
• Ask for feedback and act on it: “Leaders who seek feedback from a diverse range of employees and act on it are more likely to succeed in building trust and creating a culture of openness.”
• Use employee experience insights: “Leaders need to make decisions based on more than just financial and operational data. Employee experience insights provide the context for making smarter, better decisions that ultimately build trust and enhance organizational outcomes.”

Read the full report here. 

Navigating AI Adoption

AI adoption is another critical trend heading into 2025, and employees are often ahead of their organizations in using these new tools. “Many workers are already using AI in their jobs, but they’re left to figure out how to use these tools on their own,” Herbert notes.

While AI can be a powerful tool for improving productivity, Herbert cautions that framing AI adoption solely as a way to increase output can create fear and uncertainty among employees. “It’s important for leaders to emphasize how AI can help employees produce higher-quality work in less time, rather than focusing on AI as a tool for efficiency gains,” she explains.

Organizations that provide proper AI training and enablement, while collecting feedback throughout the process, will be better positioned to integrate AI into the workplace in a way that empowers employees rather than alienating them.

Reducing Chaos and Enhancing Efficiency in 2025

As the pace of change continues to accelerate in 2025, the most successful organizations will be those that remain focused on employee-centered change management. “The organizations that exceed employee expectations and nurture high-performance cultures are those that invest in helping employees understand how changes will affect their work and support them in adapting to these changes,” Herbert says.

Success will depend on organizations’ ability to empower leaders at all levels to make decisions that improve employee experiences, backed by a commitment to helping employees get their work done with fewer obstacles. “Removing outdated processes and reducing the burden of inefficient systems will free up employees’ energy and focus for higher-value tasks,” Herbert advises.

Ultimately, businesses that prioritize understanding how everyday employee experiences impact productivity and engagement will be better equipped to thrive in the rapidly evolving landscape of 2025. By focusing on creating environments that support their workers, these organizations will set themselves apart in the race for talent and performance in the years to come.