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Mercer’s 2025 HR Tech Report Exposes Major Leadership Gap in the AI Era

AI may be reshaping how we work, but many employees say their leaders haven’t gotten the memo. According to Mercer’s 2025 HR Technology’s Impact on the Workforce Report, fewer than 20% of employees worldwide have heard from their direct managers about how AI will affect their jobs or the business — a startling communication gap in a world increasingly defined by automation and analytics.

The global study, surveying 8,500 employees across multiple industries, finds that as AI adoption surges, uncertainty is spreading faster than strategy.

“Effective leadership in the AI era requires more than announcements about the latest tool,” said Ravin Jesuthasan, Mercer’s Global Transformation Leader. “Leaders must engage visibly, communicate honestly, and model adaptability. To ease fears, they need to walk through change with their teams.”

Anxiety Rises Where AI Thrives

Mercer’s research shows a clear correlation between AI exposure and anxiety. In regions where AI usage is highest — such as the United Arab Emirates (85%) and Mexico (72%) — employee concerns about technology’s impact are also the most intense. By contrast, several European countries with lower workplace AI adoption report minimal unease, with fewer than 10% of workers expressing worry about job displacement.

The high-tech sector, perhaps ironically, reports the most resistance to new technology. Some 63% of tech employees say AI’s potential to alter or eliminate their roles makes them hesitant to adopt it, well above the 53% global average.

Even managers and executives aren’t immune: 59% of managers and 62% of executives fear their own roles could be reshaped by technology — higher than the rates among hourly or professional workers.

Managers: The Missing Link in AI Change Management

While C-suites debate AI ethics and IT departments pilot new models, employees are looking to their direct supervisors for clarity — and not getting it.

Globally, fewer than 25% of employees have heard from their CEO about how AI will impact business operations, and just 13% have heard anything from HR.

This silence, Mercer warns, erodes trust and hinders productivity. Managers, meanwhile, are stuck in the middle — responsible for culture and performance but often left without guidance or tools to explain how AI affects their teams.

“Managers are pivotal culture carriers,” Jesuthasan noted. “They translate corporate goals into real conversations about growth, upskilling, and change. Investing in their AI fluency and people leadership is no longer optional — it’s essential.”

Trust and Culture: The Secret to Reskilling

The study also finds that the motivation to reskill is tightly linked to trust and pride. Employees proud of their organizations are 5.5 times more likely to invest time in learning new skills.

Upskilling success, Mercer reports, depends less on access to e-learning or AI-powered training modules and more on manager support and belonging. Among workers who dedicate over 15% of their monthly time to skill development:

  • 54% say their manager supports their career advancement

  • 49% say they feel genuine belonging within their teams

That sense of safety and connection enables experimentation and knowledge sharing — two essential ingredients in an adaptive, AI-ready workforce.

“To capture AI’s full potential, companies must create cultures where learning feels safe, agility is rewarded, and employees feel they belong,” Jesuthasan emphasized.

The Big Picture: Tech-Enabled Humanity

Mercer’s report reinforces a recurring theme in 2025’s HR landscape — that technology adoption without communication is a recipe for disconnection. As AI tools multiply and job roles evolve, the companies that will thrive are those that use technology to amplify human connection, not replace it.

The report closes with a warning and an opportunity:

  • Warning: A lack of communication from leaders risks alienating the very people AI is meant to empower.

  • Opportunity: Empower managers with the right tools, training, and transparency to guide employees through digital transformation — and unlock the productivity and innovation AI promises.

In short: AI may be driving the next wave of workplace transformation, but leadership — not algorithms — will determine who rides it successfully.

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