Workday Research: Millennials Lead AI Skills Transformation

Millennial leaders are emerging as the primary advocates for skills-based hiring strategies, with 92% viewing such approaches as critical for economic growth compared to 76% of Generation X leaders, according to new research from Workday.

The analysis, drawn from The Global State of Skills research and presented at Workday Elevate London, surveyed business leaders about workforce transformation priorities. The event attracted more than 1,000 participants examining how skills-based talent strategies and AI innovation are changing workplace dynamics.

The research reveals 60% of millennial leaders aged 28-43 express concern about skills shortages emerging within three years, whilst 47% of Generation X leaders aged 44-59 share similar concerns. However, the response strategies differ between the generations, with millennials taking more proactive positions on transformation initiatives.

Workday research exposes workforce strategy gaps

Both generational cohorts identify digital skills, including digital literacy and generative AI capabilities, as priorities for achieving organisational objectives over the next five years. The alignment ends there, with Generation X leaders emphasising operational and specialist skills such as project management and engineering, while millennial leaders prioritise human skills including leadership and communication.

The generational divide extends to specific workforce challenges. Millennial leaders see skills-based approaches as solutions for closing productivity gaps, with 89% supporting this view compared to 72% of Generation X leaders. Similarly, 74% of millennial leaders believe such strategies can reduce unemployment, whilst only 55% of Generation X leaders share this perspective.

Regarding diversity and inclusion, 82% of millennial leaders connect skills-based hiring to increased workplace diversity, compared to 67% of Generation X leaders. Access to opportunities shows a smaller gap, with 89% of millennial leaders and 78% of Generation X leaders seeing skills-based strategies as equalising factors.

Daniel Pell, Vice President and Country Manager, UKI, Workday, says: “The UK faces a pivotal challenge: our workforce models are lagging behind the pace of technological change. To compete in an AI-driven economy, businesses must rethink how they identify and develop skills.”

AI implementation creates uncertainty

Both generational groups recognise AI as an enabler for skills-based organisational transformation through task automation, data-driven decision support and future skills gap prediction. However, implementation clarity differs significantly between the groups.

Millennial leaders report greater uncertainty about AI deployment, with 34% stating their organisations lack clarity on using AI for talent challenges. In contrast, only 14% of Generation X leaders express similar uncertainty about AI implementation strategies.

Despite implementation challenges, adoption progress appears widespread. The research indicates 92% of millennial leaders and 86% of Generation X leaders believe their organisations are successfully transitioning to skills-based models. Additionally, 90% of millennial leaders and 83% of Generation X leaders support hiring based on validated skills profiles.

Workday recently announced new Illuminate Agents designed to accelerate hiring processes, improve frontline worker experiences, streamline financial processes, and enable rapid information access. These developments reflect the company's focus on practical AI applications for workforce challenges.

Salesforce and PwC leaders highlight workforce transformation requirements

The transformation requirements extend beyond individual organisations to entire industries. Paul O’Sullivan, SVP Solution Engineering and UKI CTO, Salesforce, says: “Agentic AI is ushering in a new world of digital labour, where you can scale and transform with autonomous agents whilst augmenting the workforce. This represents a unique opportunity to unlock new levels of productivity, autonomy, and speed only if leaders and workers reskill and upskill.”

Change management approaches also vary by generation. Millennial leaders are more likely to view change management as critical for accelerating skills-based transformation, whilst Generation X leaders prioritise clear communication of benefits and objectives.

The strategic implications extend to competitive positioning. Prasun Shah, Global CTO & AI Lead, Workforce Consulting, PwC, says: “Skills are now a strategic asset, not a side conversation. Successful AI adoption depends on an organisation's ability to reskill at scale, align workforce strategies with business goals, and design work where people and AI complement each other.”

The research suggests organisations must navigate generational differences whilst implementing skills-based strategies. As industries face AI-driven transformation, workforce evolution becomes a parallel requirement rather than a secondary consideration.

Daniel says: “This is not a question of technology alone, it is a question of leadership, agility and long-term competitiveness. The organisations that succeed will be those that treat workforce transformation as a strategic priority, ensuring both people and AI can work effectively together.”

Prasun says: “Leaders who approach AI and workforce transformation as a single, integrated journey will have an advantage in creating lasting competitive advantage.”

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