Ongoing AI integration, coupled with a fragile economy, is causing CHROs to re-evaluate their 2026 talent strategies, according to Gartner.
The research group has identified four trends that will shape talent management in 2026:
- The decline in entry-level roles will increase the demands on HR.
- HR will turn one-third of its recruiting capacity inward.
- Regrettable retention will emerge as the primary productivity barrier.
- Performance management will become less – and more – human.
“Faced with today’s uncertain market conditions, coupled with the AI revolution and a demand for fast changing skills, HR leaders must pivot to ensure their talent strategies are effective and drive growth,” says Tony Guadagni, director, Research in the Gartner HR practice.
Organisations must address the following four aspects of talent management in 2026:
As entry-level roles decline, the demands on HR increase
A 2Q25 Gartner survey of 919 employees aged 22 to 27 found that the Gen Z workforce value job mobility more than job security. While recent college graduates are leaving their organisations at an alarming rate, AI has emerged as a viable alternative for executing lower-value work. Because of this, entry-level hiring has declined, causing organisations to become more reliant on mid-level talent.
“When organisations need fewer early-career employees, it creates a fractured pathway to mid-level roles,” says Guadagni. “The organisation of the future requires a highly efficient entry-level talent pipeline – which places enormous pressure on HR to change the way they hire, train, and retain early career employees.”
Two actions that talent management leaders can take to retain entry-level talent are:
- Redesign early career development programmes, aimed at rapidly developing expertise.
- Build retention strategies for top talent that directly address the top attrition drivers: compensation and career development.
HR turns recruiting inward
The increased emphasis on closing skills gaps and employee engagement has led organisations to invest more in internal mobility. Despite this investment, internal mobility rates have remained flat.
“As new jobs are created, one in five employees will need to be redeployed by 2030 – and organisations aren’t prepared,” says Guadagni. “Organisations must leverage their recruiting teams to be more proactive in getting employees with critical skills and capabilities into the right roles.”
To help recruiters be more proactive when it comes to internal mobility, talent management leaders should ensure data about employees skills is up-to-date to determine where they fit in the ever-changing organisation. To successfully do this, recruiting teams need to know what to look for and where to find it.
Regrettable retention emerges as the primary productivity barrier
“About one-quarter of the workforce is at least 20% less productive than average,” says Guadagni. “Most organisations are remarkably tolerant of low performance and productivity, which is alarming at a time when it’s become increasingly important to executives.”
Talent management leaders in 2026 should work to reinvent performance improvement plans as most organisations are very ineffective at improving productivity of underperforming employees. They should focus on creating very prescriptive mechanisms for low-productivity employees that have very clear development goals that must be met by predetermined timelines.
Performance management becomes less (and more) human
Despite managers already experimenting with the use of AI in performance management, a majority of them report that they haven’t formally received any training about how to appropriately use AI in performance management. Talent management leaders should provide managers with approved AI tools, offer training on how to mitigate bias, as well as good uses and bad uses of AI in performance management.
“The future of performance management processes is automation, but the future of managing performance can’t be,” says Guadagni.