Recognition, purpose, and hybrid work are breaking down across Australian workplaces. HP’s latest study uncovers why 86% of knowledge workers feel their work relationship is unhealthy.
What’s happening: Australian workers’ relationship with their jobs has deteriorated sharply, with only 14% of knowledge workers reporting healthy work relationships, down 13 points from 2024.
Why this matters: With just 44% finding purpose in their work and only 39% feeling adequately recognised, Australian workplaces face a retention and engagement crisis that demands immediate action from leadership.
Australian workers are experiencing one of the most dramatic declines in job satisfaction globally, according to new research that paints a sobering picture of workplace relationships in 2025.
HP Inc.’s Work Relationship Index has revealed that only 14% of Australian knowledge workers report having a healthy relationship with their work, marking a 13-point plunge from the previous year and positioning Australia as the second-lowest performer among 14 countries surveyed.
The study, which surveyed 18,200 desk-based workers globally including 1,000 Australians, uses a five-point scale to diagnose healthy work relationships and categorises respondents into “Healthy,” “Watch-Out,” and “Critical” groups.
Loyalty eroding fast
The data reveals troubling trends in employee commitment. Fewer workers feel proud of their company, would recommend it as a great place to work, or see themselves staying for another two years. The decline spans leadership effectiveness and people-centricity, with employees reporting they feel less cared for and less connected to organisational purpose.
“The traditional employment model has fractured. Global disruption, economic pressures, and changing workplace expectations have created an environment that feels more demanding and less rewarding,” said Brad Pulford, HP’s Managing Director for Australia and New Zealand.
Workers across finance, professional services, manufacturing, and education all experienced double-digit drops in their Work Relationship Index scores. Even business leaders weren’t immune, suffering a sharp 15-point decrease that reflects the pressures of navigating a challenging business environment.
The erosion in workplace satisfaction stems from two critical weak spots: purpose and recognition. Only 44% of Australian knowledge workers say their work gives them a sense of purpose, whilst just 39% feel they receive adequate recognition for their contributions.
Pressure and change mounting
More than half of Australian workers experienced significant workplace changes over the past year, ranging from cost-cutting measures and redundancies to shifts in hybrid working arrangements. These transitions have taken their toll, with 58% of workers reporting that employer demands and expectations have increased.
The mounting pressure comes at a time when employees are already feeling disconnected from their work and questioning their long-term commitment to their organisations.
AI offers hope
Despite the gloomy outlook, technology and artificial intelligence emerge as bright spots in the research. The report shows that 77% of Australians now use AI at work, with 31% using it daily. This growth in AI adoption is increasingly being driven by older generations, with baby boomers catching up to their younger counterparts.
The impact of proper technology investment is significant. Employees who work for companies that invest in providing the right tools and AI are up to five times more likely to have a healthy relationship with work.
However, the research emphasises that technology alone isn’t a silver bullet. It’s most powerful when thoughtfully deployed as part of a broader package of consistent, human-centred workplace changes.
What employers must do
With many drivers of fulfilment sitting within an organisation’s control, leaders can take immediate action to reset workplace relationships. The research outlines a practical employer playbook for 2025 that extends beyond conversations about pay and conditions.
Key recommendations include elevating frequent, specific recognition linked to company values and outcomes, making hybrid collaboration more equitable by designing in-office time around collaboration rather than presenteeism, and protecting focus by cutting tool sprawl and context-switching to help meaningful work time grow.
On AI implementation, organisations should provide clear guardrails, training, and role-relevant use cases so artificial intelligence augments work rather than overwhelms it. Perhaps most critically, companies must equip managers to set clarity, balance workloads, and maintain regular, high-quality check-ins with their teams.
“This is a wake-up call for every employer in Australia. Despite the pressures around us, the drivers of fulfilment sit largely with employers: how we lead, how we recognise people, and how we put technology to work so it restores focus,” said Pulford. “That’s the future of work Australians deserve: equitable collaboration, time back for focus, and AI that helps and never overwhelms.”
The research suggests that whilst economic pressures and global disruption have created challenging conditions, Australian businesses have the power to reverse these trends through thoughtful leadership, meaningful recognition, and strategic technology deployment.
For organisations looking to retain talent and rebuild workplace relationships in 2025, the message is clear: the time to act is now, and the solutions are largely within their control.
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