The hiring landscape is evolving at a rapid pace, and 2025 is set to bring even more transformative changes. With advancements in AI, shifting workforce expectations, and an increasingly competitive job market, recruiters must stay ahead of the curve to attract and retain top talent. 

Here are the main factors that will impact hiring decisions and the recruitment industry in 2025. 

The Gig Economy 

The gig economy stands for a labour market where independent workers are hired for short-term jobs or ‘gigs’ instead of salaried positions. The global gig economy reached USD 556.7 billion in 2024, and is expected to exceed a trillion by 2032.  

As this flexible labor market continues to expand, businesses are increasingly adopting agile hiring strategies to remain competitive. One key shift is the rise of the ‘trial period’ approach, where companies use contract work to assess talent before making long-term hiring commitments. With remote work becoming more common, businesses are no longer restricted by geography and can tap into a global talent pool. 

Additionally, the flexibility of gig work is attracting more highly skilled professionals who are exploring contract or freelance roles—whether as a full-time career or a side gig. This shift expands the available talent pool providing recruiters with greater access to specialized skills, especially during times of economic uncertainty. When permanent hiring slows, being able to supply contractors ensures you remain relevant to your clients, preventing them from seeking other suppliers.   

New policies 

Presidential elections in the U.S. have always had an impact on hiring trends, as businesses and investors react to the uncertainty and potential policy shifts that come with changes in government leadership. With the new administration stepping into power in January 2025, businesses will need to adapt to expected changes in tax policies, labor laws, and business regulations that could impact the job market.  

For example, industries that received strong investment and government support under the previous administration, may experience shifts in priority. This can lead to fluctuations in talent demand and supply across industries, influencing the recruitment strategies businesses and staffing firms adopt. 

AI and Automation  

AI will continue to impact not only recruitment firms but also the way internal hiring teams work.  

Gen AI allows the automation of many tasks freeing up time for recruitment teams to focus on skills-based hiring, or growing the business. According to a recent LinkedIn report, adoption among recruiting teams is growing, with 37% of organizations now “actively integrating” or “experimenting” with Gen AI tools, up from 27% a year ago. An astonishing 73% of TA pros agree that AI will change the way organizations hire.  

According to recruitment professionals using AI, it can improve hiring efficiency, boost job post effectiveness, enhance the candidate experience, and expand talent pools. According to Bullhorn, agencies predict that the use of AI in the recruitment workflow could result in an extra 17 hours per week for each recruiter. The same report also shows that automation and AI can make it 75% more likely that time to place is under 20 days. 

Another way the adoption of AI will continue to impact recruitment is through the talent and skills it will demand for best adoption and integration. This will continue to create new roles and skillsets that those who hire will be required to source.  

Skills-based hiring 

Skills-based hiring is the practice of hiring based on candidates’ skills, rather than their degrees or their job history. Just in 2024, globally, 81% of companies use skills-based hiring, compared to 73% in 2023 and 56% in 2022. The key basis of these shifts in the recruitment models has always been the skill gap. The skill gap can be defined as the inconsistency between the skills that you would expect the employees to possess and the ones that they actually have. This was particularly influenced by COVID-19, and since recruitment has slowly been making a move towards a skill and competency-based hiring model. 

Since the cost of higher education may be unaffordable for some, eliminating degree requirements from certain job postings can help improve social mobility. According to ADP, 90% report fewer hiring mistakes, this makes it a preferred method for screening and selecting candidates by companies. It can also mean tapping into undiscovered talent groups including ex-forces and returners to work. For recruitment firms, this has potential to future-proof their talent pipeline.  

Ultimately, 2025 is the year of skill-based hiring, AI, and more flexibility. By focusing on candidates’ capabilities rather than just credentials, you’ll tap into a broader and more diverse talent pool. 

Want to stay ahead in 2025? Let’s connect and explore how we can help you navigate the evolving US job market.