Workplace dynamics have evolved dramatically in recent years, and 2025 represents a major milestone in that journey. Artificial intelligence is not a far-fetched concept or just another trendy buzzword for marketing gurus. As companies are adapting hybrid work, the talent pool is getting extremely competitive, and AI is stepping.
AI is no longer a theoretical concept, or a buzzword confined to HRs when looking for new recruits, it is now the backbone of how organisations understand and support their staff. More and more companies are adapting to a hybrid work culture and we are seeing a rise of competition in the talent market. To keep up with these changes, AI is stepping up to build more responsive, personalised and efficient employment engagement strategies.
AI in Employee Engagement: From Static Surveys to Real-Time Connections
Gone are the days when employee engagement meant filling out long annual surveys that often led nowhere. Today’s employees expect ongoing conversations, tailored support, and a real sense that their feedback actually matters. This shift is both an opportunity and a challenge and an opportunity for HR teams to not only keep up, but stay ahead of the requirements of modern, distributed workforces.
That’s where AI in employee engagement comes in. The global AI in HR market size was estimated at USD 3.25 billion in 2023. It is expected to grow at a CAGR of 24.8% from 2024 to 2030.
What began as simple automation—chatbots answering FAQs or tools that tracked basic metrics now has quickly developed into sophisticated systems that can forecast employee burnout, flag drops in morale, and recommend steps to re-engage teams before problems snowball. The impact isn’t just technical—it’s a shift in mindset about how companies relate to their people.
Reading the Room: What AI Really Sees
One of the biggest assets of using AI in this space is its ability to process large volumes of data and extract insights that humans might miss. These systems can examine patterns in email communications, meeting schedules, collaboration tools, and even the emotional tone of internal messages to understand how teams are really feeling.
While gut instincts and intuition are important, managers now have a stronger and more reliable data-driven snapshot of what’s going on within their teams. For instance, AI might highlight that employees logging long hours with minimal interaction are at risk of disengagement. That kind of foresight allows companies to step in and support people before they burn out or consider leaving.
Making AI-Powered Employee Engagement Personal at Scale
What’s truly game-changing is AI’s ability to personalise engagement across an entire organisation. Everyone is different—some people are energised by public recognition and group projects, while others do their best work quietly and independently. Historically, HR strategies haven’t had the bandwidth to cater to these individual differences.
AI is being used to understand how people work, communicate and respond to various feedback, which is enabling HR teams to craft unique and bespoke engagement approaches that resonate with the audience. AI can suggest different recognition tactics or communication styles based on individual preferences, accounting for cultural factors. Proper consideration towards such cues can make engagement efforts feel more authentic, improving their efficiency.
Real-Time Feedback, Real-Time Impact
Instead of collecting feedback once or twice a year, many companies are now using AI tools to keep a constant pulse on how employees are feeling. Whether it’s through quick surveys, sentiment analysis from communication tools, or tracking participation in initiatives, these platforms offer a real-time view of engagement across the organisation.
This always-on approach means companies can adjust their strategies quickly. If a new policy is creating stress, for example, or if a team feels overlooked during a busy quarter, the system can alert leaders before things spiral. On the flip side, it also helps identify what’s working well—so successful strategies can be scaled and shared.
Starting Small: AI MVPs in HR
Building a full-fledged AI engagement system overnight isn’t practical—or necessary. That’s why many organisations are starting with focused pilot programmes, or Minimum Viable Products (MVPs), to test AI’s potential. AI MVP development services might center on one use case, like predicting attrition risk or customising how recognition is delivered.
This smaller-scale approach lets companies gather data, see results, and make tweaks before rolling out broader programmes.
A Bigger Picture: AI across HR Functions
While employee engagement is a key area, AI is also transforming how HR teams approach hiring, performance management, workforce planning, and even leadership development. The magic happens when all of these systems talk to each other, when engagement data informs recruitment strategies, or when performance insights help identify new ways to motivate teams.
Popular Artificial HR Tools for Different HR Functions:
Talent Acquisition and Recruitment
- HireVue – AI-powered video interviewing and candidate assessment.
- Eightfold AI – Talent intelligence platform that predicts career paths and matches talent to opportunities.
- Hiretual (HireEZ) – AI sourcing tool for finding and engaging top talent.
Performance Management
- Lattice – Performance management platform with AI-driven analytics.
- 15Five – Continuous performance management with real-time employee feedback and engagement insights.
- Betterworks – OKR-based performance tracking enhanced with predictive AI models.
Workforce Planning & Analytics
- Visier – Workforce analytics and planning tool that helps predict turnover, skills gaps, and more.
- OrgVue – Data-driven organisational design and workforce planning.
- ChartHop – Combines org charts with people analytics for smarter planning.
Employee Engagement & Retention
- Qualtrics EmployeeXM – AI-enabled platform for real-time employee feedback and sentiment analysis.
- Peakon (by Workday) – Continuous listening platform with predictive analytics.
- Culture Amp – Engagement surveys with action planning supported by AI insights.
Learning & Development
- Degreed – AI-powered learning experience platform that curates content based on skills and goals.
- EdCast – Personalised learning and upskilling through AI recommendations.
- Cornerstone OnDemand – L&D platform with AI-driven content and career pathing.
Leadership Development & Succession Planning
- Plum – Talent assessment for leadership potential and role fit using AI psychometrics.
- Fuel50 – Career pathing and talent marketplace with predictive talent mobility features.
- SHL – Talent assessment and development platform with AI-based potential analysis.
Challenges of Using AI Tools in Employee Engagement
As powerful as these tools are, they’re not without risks. Privacy is a major concern—employees need to know how their data is being used, and that it won’t be weaponised or misinterpreted. Transparent communication and ethical AI design are non-negotiable.
There’s also the danger of leaning too heavily on tech at the expense of human relationships. AI can highlight issues and suggest actions, but the follow-through still needs to come from real conversations and genuine leadership. And, of course, bias is always a risk in AI systems. Ensuring fairness and inclusivity means being proactive about testing, auditing, and improving how these tools are built and used.
Real World Case Study: Electrolux Group HR Process AI Digitisation
To tackle a global talent shortage, Electrolux Group were willing to question the way they approach hiring. They turned to an AI recruitment platform called the Phenom Intelligent Talent Experience.
The goal? To modernise and digitalise their recruitment process, open up more opportunities for internal growth, and make the entire candidate journey smoother, more engaging, and more human.
By focusing on people—both inside and outside the organisation—Electrolux set out to create a talent experience that feels less like a process and more like a connection.
By integrating AI-powered tools—like a dynamic career site, a candidate relationship management (CRM) system, video assessments, and automated interview scheduling—Electrolux was able to simplify and speed up the hiring process. These tools not only reduced manual tasks but also improved teamwork and communication across recruitment teams.
By introducing a Talent Marketplace and employee referral features, Electrolux made it easier for people to grow their careers from within and support each other along the way. Employees could discover new roles that matched their skills and interests, while also helping to bring great talent into the company.
Key Results:
- 84% increase in application conversion rate
- 51% decrease in incomplete applications
- 9% decrease in time-to-hire
- 20% reduction in recruitment time using video assessments
- 78% time saved with automated scheduling
Phenom empowered Electrolux to engage passive candidates, accelerate hiring, and deliver a seamless experience—both for candidates and internal teams.
Looking Forward
As we continue through 2025, the role of AI in employee engagement will only grow. These tools will become more predictive, more integrated with daily workflows, and even better at helping people grow in their careers. But the organisations that succeed won’t be the ones that automate everything—they’ll be the ones that use AI to support, not replace, the human side of work.
Companies are now better able to see their employees and understand their demands with more insight, empathy and intention. Those who get AI in employee management right, can build workplaces where people heard, understood and empowered to thrive.
Author: Albert Hilton – Content marketer
Photo credit: StockCake
