what to spend your hr budget on in 2025
Budget what budget? Because let’s address that first, times are tight for many businesses so whilst April is traditionally the month of renewed financial budgets, we understand that many HR professionals and businesses might be looking at a reduced budget and wondering how to spend it as effectively as possible.
In this blog, we’ll help you pick out the Top 5 priority areas for your 2025 HR budget.
1. Employee Wellbeing and Mental Health
First up for a reason, you can’t really put a price on this. There’s plenty you can do in this area which is low or no cost but if you are able to provide access to mental health resources then you should make this a priority, studies show that this type of investment correlates with improved employee satisfaction and retention, but it doesn’t take a genius to work out that if you look after your employee's wellbeing, the outcomes are better for everyone.
2. Upskilling and Reskilling
Technology is advancing fast and ensuring your team have the right skills is vital. Professional upskilling can be costly there’s no getting around that but what’s the impact on your budget if you don’t do it? Employees behind the curve or even employees who vote with their feet and take their skills elsewhere. Invest in development and professional growth and be rewarded with loyalty and reduced hiring costs as a result - simple!
3. Diversity, Equity, and Inclusion (DEI) Initiatives
Meta, Microsoft, Goldman Sachs, what do they all have in common? Yep! Rolling back their DEI initiatives - don’t join that club we implore you. A diverse and inclusive workplace is both morally and strategically the right thing to do. Allocate budget to DEI training, outreach and enhancing your policies. If this isn’t a line on your HR budget and you’re in danger of joining the aforementioned club, make it a priority to change that.
4. Advanced HR Technology
Make the role of HR simpler, streamline operations and reduce errors. HR Management systems and payroll solutions make a huge difference to organisations and teams whatever their size plus the wide range of analytic tools provide insight into teams and employees like never before. Of course, great tech rarely comes cheap so focusing on systems that provide measurable and visible impact is a good approach here.
5. Reward and Recognition
This might be the most contentious of our list because you’ll find no one more sceptical than us when it comes to free beers and forced fun as a form of rewarding employees. So our first port of call here would to be find out what your employees want. Everyone wants recognition but what’s the best reward? Maybe it’s an extra day's leave (which we appreciate has a cost to the business) or maybe it is a financial-based incentive. Explore your options and find out what works but don’t ignore employee recognition.