isolved Study: HR Leads with AI as Strategic Expectations Outpace Capacity
HR’s Strategic Influence Grows as Leaders Navigate Economic Pressure, Skills Gaps and AI Adoption
Press Release Disclaimer: This is a press release distributed through the XPR Media network. It has not been independently verified by our newsroom.
CHARLOTTE, N.C., Oct. 14, 2026 (GLOBE NEWSWIRE) — isolved®, a Workforce Capital Management (WCM) company that helps organizations recruit, retain and elevate their workforce, today released its 2026 HR Leaders Report, The Workforce Decisions Defining HR. Based on a survey of 1,005 U.S. HR decision makers, the report illustrates how HR teams are balancing strategic expectations with limited capacity. While nearly all HR leaders say their teams are viewed as strategic, rising costs, skills gaps and repetitive work continue to pull focus from that strategic role.
HR Has Earned Strategic Influence. Now It Needs the Capacity to Use It.
Ninety-nine percent (99%) of HR leaders say their team is seen as strategic, up from 94% in 2025, and 88% are optimistic about the future of the profession. But repetitive work still limits the time available for broader priorities. Nearly half (47%) spend four or more hours a day answering repetitive employee questions. If they could get that time back, 70% of HR leaders would spend it on strategic initiatives.
Leaders recognize the gap and are open to outside support. Seventy-seven percent (77%) say outsourcing could benefit their teams, though only 45% plan to outsource this year.
“HR’s strategic influence is stronger than ever, but with that comes responsibility for a much wider set of decisions,” said Amy Mosher, Chief People Officer at isolved. “Between cost pressures, AI and changing workforce expectations, HR leaders are being asked to navigate decisions that look very different from even a few years ago. We don’t need to have all the answers, but we do need to understand our workforce, use the data we have and be thoughtful about where technology can help people do their best work.”
AI Use Climbs as CHROs Lead the Way
AI is now part of everyday HR operations, and adoption rises with seniority, from 70% of HR managers to 91% of Chief HR Officers. AI fluency is becoming a core leadership expectation, and HR teams are now deciding where AI should act, where human judgment matters most and how to build employee confidence with new tools.
Payroll leads AI adoption in HR (48%) and is the area where leaders see the most potential (50%). Payroll is also where mistakes remain common, as nearly two-thirds of HR leaders (65%) reported a payroll error in the past year.
“HR leaders got into this field to help people and grow the business,” said Michael Haske, CEO of isolved. “This report shows they see AI as the best way to get back to that work. They’re starting with payroll, where the stakes are highest, and the work consumes the most time. That’s the right place to start. AI that delivers outcomes, with humans always in the loop, gives HR its time back for the real work of HR.”
As AI adoption grows, HR leaders are reevaluating whether their current HCM technology can deliver meaningful results. Sixty-four percent (64%) are considering switching HCM solutions in the next 12 months, and among them, 47% cite stronger AI and innovation as the top reason.
Cost Pressures Push HR to Build Capacity in New Ways
Nearly nine in 10 HR leaders (89%) report at least one cost pressure shaping workforce decisions, forcing tougher decisions about hiring, staffing, technology and employee investments. Benefits and healthcare costs (51%) and wage inflation and compensation (50%) are the top pressures HR leaders say are driving those decisions.
As organizations explore different ways to meet workforce needs beyond traditional hiring, more than a third (34%) are increasing their investments in AI or automation instead of hiring, 28% are relying more on contractors or temporary workers and 26% are hiring only for select roles.
Skills Gaps Widen as Workforce Needs Change
Fifty-nine percent (59%) of HR leaders say their workforce has a skills gap, up from 48% in 2025. Over half (51%) describe the situation as a “talent crisis.” Among those who see a crisis, 67% point to a shortage of skilled workers.
Recruiting processes add to the challenge. Sixty percent (60%) say their recruiting strategies fall short on speed, and 45% cite weak candidate communication and feedback. Slow hiring and poor candidate experiences can make critical roles even harder to fill.
“The skills shortage is forcing employers to think differently about how they build their teams,” said Heidi Barnett, President of Talent Acquisition at isolved. “Hiring is still critical, but employers can’t rely on filling every gap with full-time hires alone. They need to understand the talent they already have, where the real gaps are and how faster, more transparent recruiting, internal development and AI can help them find the right fit for the work that needs to get done.”
To read all the key insights revealed in isolved’s 2026 HR Leaders Report, download a copy here. For HR leaders ready to turn these insights into action, book a demo of isolved People Cloud™ and see how it helps HR leaders boost retention, lift satisfaction and simplify daily work.
About the Report
The 2026 HR Leaders Report, The Workforce Decisions Defining HR, is based on a survey conducted by a third-party research firm in the second quarter of 2026 and includes responses from 1,005 U.S.-based HR decision makers in management roles or higher. Respondent demographics are broken down by industry, gender, seniority, company size and generation.
About isolved®
isolved® is a Workforce Capital Management company — the next evolution of HCM, where human workers and AI agents are governed together on a single system of record, with the same visibility, accountability and lifecycle management. isolved People Cloud™ is a connected platform of action that brings together HR, payroll, benefits, workforce management and talent management, with practical AI built to deliver outcomes. Built on 40 years of benefits-first HCM expertise and trusted by more than 200,000 employers and 9 million U.S. employees, isolved is the platform of action for the businesses that drive the American economy. Visit www.isolvedhcm.com.
Media Contact:
PAN Communications
isolved@pancomm.com
Media gallery
