HR leaders see clear benefits in AI-powered tools, but many admit they don’t have the skilled workforce to use them effectively.
Capterra’s 2025 HR Software Trends Survey, which gathered insights from over 3,200 HR professionals across 11 countries, reveals how rising recruitment costs, employee churn, and software complexity are pushing companies to lean more heavily on AI, even as they scramble to train staff to keep up.
Hiring Gets Pricier, AI Gets Smarter
With 59% of HR leaders anticipating growing recruiting costs and 44% naming talent acquisition as a top challenge this year, 49% of companies already using AI in their HR software say it’s improved their hiring outcomes.
AI is increasingly seen as a practical fix for overburdened recruitment teams as it handles repetitive admin and refines candidate matching.
Despite this, only 42% of HR leaders see recruiting software as a critical need, a surprising blind spot considering that 63% expect to grow their workforce in the coming year.
The Skills Crisis Moves In-House
Forty-five percent of HR leaders cite upskilling current staff as their biggest operational challenge, and 68% expect those costs to rise. The average company is juggling four different HR tools, and almost 50% say their main software concern is simply training new users.
Bruno Peláez, senior analyst at Capterra, said: “As workforce needs evolve, adopting the right HR technology is only the first step. Success depends on organisations keeping people at the centre of every technology decision, building AI skills to futureproof their workforce, and implementing strategies to engage and retain them.”
A further 43% identify a lack of AI skills as a significant hurdle to adoption. Many are now turning to integrated learning management systems and talent analytics to build internal capability before the AI gap grows any wider.
AI Is Helping Engagement
Contrary to fears that AI in HR would erode the human touch, the data tells a different story. Among HR software users, 43% who use AI features report better employee satisfaction, compared to just 27% of those not using them. Retention also improves 39% for AI users versus 25% for non-users.
However, about 50% of HR leaders say they’re unsure how to evaluate AI’s risks and benefits, particularly when it comes to data quality, AI literacy, and privacy.
With privacy and compliance under the microscope, 67% of HR leaders say security is a top consideration in software purchases, and 43% say it was the primary driver of new purchases last year.