Most employers optimistic about company’s performance for new year: report
Most employers are entering 2025 with a cautiously optimistic outlook despite ongoing economic and operational challenges.
Overall, nearly half (49 per cent) of respondents report high confidence in their company’s performance, with an additional 33 per cent expressing cautious optimism, according to a HUB survey.
Growth projections are strong, with 68 per cent of companies expecting revenue increases of up to 10 per cent, and 36 per cent of upper-middle-market firms anticipating growth between 10 per cent and 50 per cent.
Also, many businesses are focusing on expansion strategies:
- 45 per cent are planning or implementing strategic partnerships
- 43 per cent are pursuing mergers and acquisitions (M&A)
- 35 per cent are exploring international markets.
Despite this, many employers cite the following key risks affecting profitability in 2025:
Artificial intelligence (AI) is identified as a key priority most likely to positively impact profitability in 2025 by 35 per cent of survey respondents, a nine per cent increase over 2023.
While awareness of the power of AI has increased year over year, readiness to move forward remains at 53 per cent among those who indicated it was a top priority, finds the HUB survey.
Canadian businesses are entering the final quarter of 2024 with mixed sentiments, as optimism about the year ahead balances against ongoing challenges related to costs and labour, according to a previous report from Statistics Canada (StatCan).
What are the top priorities for companies in 2025?
According to the HUB survey of 900 business leaders across the U.S. and Canada, employers’ top priorities for 2025 are:
Employee productivity is a critical focus for organizations in 2025 both for employers in the U.S. (66 per cent) and Canada (75 per cent). Employers are increasingly tying total rewards, including compensation, to productivity metrics such as revenue, sales growth, and performance ratings.
Rising healthcare costs are also a top concern. A majority of companies (67 per cent) are implementing measures to reduce the cost of medical benefits. While U.S. employers are focusing on HR policy adjustments – such as increased premiums for smokers or limiting spousal coverage – 40 per cent of Canadian firms plan significant changes to their health plans.
Prescription drug costs remain a major issue, with prices growing nearly twice as fast as overall health benefit costs. Specialty drugs, including gene therapies and weight-loss medications, are primary drivers.
Increasing health and benefit costs is the top people risk for employers in Canada, according to a previous report from Mercer Marsh.
How many companies use business analytics?
Analytics continues to play an essential role in guiding business decisions. The number of employers viewing analytics as "extremely important" has increased year-over-year, particularly in benefits planning and cost management, found the HUB survey.
However, a third of respondents still consider analytics only "slightly" or "moderately important," underscoring a divide between early adopters and less data-driven organizations.
As businesses prepare for a dynamic 2025, they are balancing immediate pressures with long-term strategies to build resilience, drive growth, and foster a thriving workforce.
“Siloed teams put businesses at risk. Organizations with integrated risk management and benefits best practices are better equipped to achieve sustained profitability, workforce vitality and resiliency,” says HUB in the report.
“The HUB 2025 Outlook Executive Survey highlights that while risk and disruption will continue, successful business leaders are making constant shifts to navigate an increasingly complex world. With the right partners and analytic insights, they can gain an edge and remain resilient amid unforeseen disruption.”
People analytics lay the groundwork for data-informed HR decisions, according to The Chang School.
