Organizations are bankrupting their future by burning people out today, expert says
Most organizations are surviving and efficient — but many are not realizing that efficiency is coming at a cost to their long-term workforce.
One of those long-term effects includes organizations losing expertise and knowledge. Sixty-eight per cent of organizations report losing important skills or expertise without fully realizing it, while 73 per cent say those lost skills are making it harder to rebuild, according to the Dayforce 17th Annual Pulse of Talent report.
Amy Cappellanti-Wolf, chief people officer of Dayforce, says organizations have struggled with this issue in the past through restructuring of workforces — but the current state of the market is making it worse.
“The fact that we’ve got all this marketplace things happening, external market pressures around performance and top and bottom- line growth, doing more with less, AI everything, I think that’s just compounded the fact that people are probably working harder and they’re not seeing relief [on] how they’re going to be able to sustain this,” she says.
What organizations are not realizing, she says, is that employers are “bankrupting their own future” — especially through burning out people.
Some respondents agree — more than half (59 per cent) say that the strong workforce performance they are seeing today might not show vulnerabilities the come up in the near future, the report finds.
For HR leaders, the report is a reminder that strong performance today does not guarantee a strong workforce tomorrow.
The research findings came from 6,909 respondents who work at organizations with more than 100 employees across Australia, Canada, the United Kingdom, New Zealand, Germany, and the United States, in partnership with Hanover Research.
The lack of backups
One of the reasons the workforce is seeing only a few “go-to people” with the knowledge and expertise, Cappellanti-Wolf says, is partly due to whether the workforce is spreading work across effectively.
Organizations have always worked in a place of not having enough resources — which creates only a few people to hold the knowledge and expertise, she says. They become a single point of failure when organizations do not have their backup with other people with the same knowledge and talent when they leave.
“I think the problem is that we rely on the same people too often, and then when they go, what’s your backup plan?” she says.
This is more apparent, she adds, with 60 per cent of respondents reporting that understaffing has become normalized in today’s organizations. Furthermore, 85 per cent say that losing key employees would cause at least a moderate level of disruption to the workplace, with 55 per cent saying the disruption would be severe.
Cappellanti-Wolf points out it can also be due to the longevity of who is staying in the workforce that is not leaving room for new talent pipelines.
“‘60 is the new 40,’” she says. “Sometimes, you’ve got people that want to get up to the next level or want to take a role, but you’ve got people in those roles that are incumbents that know it. And why would you want to move them out to give that person opportunity experience?”
Losing the essential skills to AI
On the talent pipeline, AI is also having an effect — 49 per cent of respondents say the work that has helped them build experience is now being handled by AI, and 51 per cent say it is reducing early-career opportunities.
A 2025 study published in Business and Information Systems Engineering found that while generative AI (GenAI) can help entry-level workers develop new skills to improve creativity and innovation, it can also lead to skill stagnation and the loss of essential skills — particularly tasks that managers would have previously delegated to those workers but are now handled by GenAI instead.
Cappellanti-Wolf says she does not subscribe to the idea that organizations should stop hiring early-career workers.
“If you don’t hire innovation off campus, you’re not going to learn new things. And by the way, they are learning new things on campus every day that we aren’t learning because we’re not in the classroom or doing that work together,” she says.
What organizations can do now
The report highlights that to avoid a fragile workforce that could face disruption in the future, organizations need to be thinking about protecting capacity, expertise, and development of the workforce.
Cappellanti-Wolf says it first starts with organizations reevaluating their priorities and identifying friction points in the workforce.
“I think you have to start helping people think through, at a very granular level, — what are things that cause friction in the workplace in terms of too many touches, too many errors, too manual? And start to attack each of those types of workflows as you decide which are the priorities,” she says. “Remember, workflows just don’t sit within a function, they often sit across functions. So,how do you think more cross-organizationally and functionally versus just within my silo?”
When it comes to AI in the workforce that is also causing the fragility, Cappellanti-Wolf says organizations need to look at the bigger picture — especially with AI agents.
“I think we’re all going into — 'How do I use AI to just get into this process?’ As opposed to systemically — ‘How am I going to use AI to improve my organizational health, get people working on the right things from a productivity perspective, and also give people time back to learn this stuff,’” she says.
“You want to be able to give people time to do their jobs more effectively. They also need to learn. So, if you move right into here’s more stuff to go do, I think you’re missing the game.”
There is often not enough time for workers to learn skill gaps alongside their workload — the report finds that 55 per cent say they are expected to learn new skills while delivering the same workload, and only 27 per cent say they actually have the time to do so.
In addressing concerns of workforce fragility, Cappellanti-Wolf says HR should work to create the “connective tissue between functions” of the organization.
“HR leaders — how do you create conditions for that where you give people the necessary skills and tools and frameworks to use this work? And then you’re there to help make certain it’s connecting across the enterprise,” she says.
An example she points to is the employee onboarding process — a critical process that research has shown matters for whether employees stay in the long run. In this process, Cappellanti-Wolf says HR should make sure the hiring manager is prepared for the new hire, IT is helping with technology and equipment, and payroll is set up on time.
“I can’t go in and tell a software engineer what his workflow should be or how much should be agentic, how much shouldn’t,” she says. “But what I do need to do is give people common frameworks on how to think about this — common language, working with the IT organization around tooling, so, everybody has some access to be able to use this effort.”
