The Australian HR Institute (AHRI) has released a timely and insightful report titled Hybrid and Flexible Working Practices in Australian Workplaces in 2025 , based on responses from over 1,000 HR professionals and business leaders. The findings confirm what many in the profession have observed, hybrid work is not just a trend but a part of the how we work today.
According to the report, over 80% of employers expect hybrid work to either increase or remain stable over the next two years. The benefits include: 65% of respondents cited improved work-life balance, 44% noted better employee retention, and 41% highlighted enhanced wellbeing. These outcomes reinforce the value of flexibility as a strategic advantage in attracting and retaining talent, while also supporting employee engagement and productivity.
However, the report also identifies challenges. More than half of respondents reported that employees feel disconnected in hybrid environments, while 38% noted difficulties with collaboration and 35% pointed to challenges in performance monitoring. These findings underscore the importance of intentional leadership and structured support systems to make hybrid work sustainable.
A key theme emerging from the report is the critical role of manager capability. A factor in the success of flexible work arrangements is on how well managers can lead distributed teams, maintain cohesion, and ensure accountability. This is important in the Australian Public Service, where there is a growing emphasis on building the capability of middle managers to navigate evolving workplace expectations.
Middle managers are the linchpin between the strategic direction and operational delivery. As such, they must be equipped with essential skills such as project management, critical thinking, and adaptive leadership. These capabilities are vital for managing complexity, fostering innovation, and ensuring compliance in a rapidly changing environment. Investing in targeted development programs, coaching, and peer learning will be key to strengthening this layer of leadership.
Another area of growing focus for HR professionals is the integration of artificial intelligence (AI) and digital tools. The HR function is increasingly leading the charge in guiding the ethical and effective use of AI across the employee lifecycle—from recruitment and onboarding to learning and workforce planning. As AI becomes more embedded in workplace systems, HR must partner with business leaders to ensure that implementation is both responsible and inclusive.
Change management, education, and digital literacy will be essential to support this transition. By fostering a culture of curiosity and continuous learning, HR can help organisations unlock the full potential of AI while maintaining trust and transparency.
In summary, the AHRI report provides a valuable roadmap for navigating the future of work. It highlights the importance of flexible work models, the need to uplift managerial capability, and the strategic role HR plays in digital transformation. As we move further into 2025, these insights will be critical in shaping resilient, people-centred workplaces.