2025 Year in Review (and What to Look for in 2026)
2025 was a year marked by change and uncertainty, which in turn made workforce planning especially difficult. Before we jump head-first into 2026, let’s look at some moments that defined (for better or worse) this past year. That way, you can learn from the good, bad, and ugly, and set yourself up for success in the new year.
Macroeconomic Trends
It’s no understatement to say that 2026 was a volatile year economically. Although interest rate reductions and slowing inflation in the latter half of the year helped boost investor confidence, confusing trade policies and regulatory environments made strategic planning particularly challenging.
Tariff Uncertainty Shook the Industry and Caused Workforce Strategies to Change
When we first wrote about trade policies back in May, the manufacturing sector was still reeling from the shock of the first rounds of tariffs and the ensuing market volatility. We dealt with rising input costs, supply chain disruptions, investment delays, and a renewed interest in reshoring and nearshoring.
From a workforce perspective, we saw clients direct their energies toward scenario planning, contingent labor models, and accelerated upskilling to hedge against unpredictable trade policies. Since then, the situation has become more complex; however, the core need for strategic workforce management from expert partners remains the same.
Reshoring 2.0: How It’s Transformed the Future of Manufacturing
One of the biggest topics of discussion in 2025 was the resurgence of onshore or nearshore manufacturing in response to both tariff uncertainty and the still-struggling supply chains. However, while reshoring promised greater resilience against these external pressures, it collided head-on with a severe and growing labor shortage.
Since we published this article, it’s become clear that the biggest constraint on bringing home production isn’t tariffs or financial incentives, but the availability of skilled labor and the inability to ramp talent fast enough to meet demands. As such, Reshoring 2.0 is less a supply chain problem and more a staffing problem, making workforce strategy the core factor of success.
AI Data Centers
When TIME Magazine named the “Architects of AI” to be the 2025 Person of the Year, they validated a reality people were already feeling: that AI was the story that overshadowed everything else last year. For industrial, technical, and engineering professionals, this trend hit home in a very specific way: data centers.
AI data centers were one of the biggest sources (if not the biggest source) of technical employment in 2025, a trend that will almost certainly continue for years to come. Here are two of the biggest stories we wrote about AI data centers last year.
Why Hyperscale Data Centers Fall Behind Schedule (and How to Prevent It)
When data centers fall behind schedule, it’s rarely due to a single point of failure. Usually, there are many structural constraints that collide, one of which is a shortage of specialized labor needed at each phase of the build. The result is not just slower timelines, but delayed revenue and a lost competitive advantage in a high-opportunity economy.
AI’s Next “Cold War”: How Data Center Cooling is Creating New Technical Job Opportunities
When it comes to the race to build AI data centers, things are heating up. Literally. One of the engineering challenges facing the market is the inefficiency of traditional cooling methods. This means that without an alternative to air-based cooling, AI chips will literally crash and burn under current data center workloads.
This technological arms race, or “cold war,” has resulted in numerous companies racing to deploy advanced cooling solutions like direct liquid cooling, immersion cooling, and on-chip microfluidics. However, as with most engineering challenges, there is a shortage of specialized mechanical, electrical, facilities, environmental, and IT talent to create and maintain them.
The Future of Work
The combination of economic constraints, talent scarcity, and the advancement of AI tools has resulted in a dramatic transformation of the nature of work, especially for engineering and technical professionals. Based on our experience with clients across the country, here are some of the biggest trends we spotted this past year.
Is the Future of Work Project-Based?
Last year, we noticed a major shift toward project-based work among our clients. In most cases, this change was driven not by ideology but by necessity: economic uncertainty (which, in turn, led to slimmer budgets) combined with a tight labor market for in-demand skills. Although we don’t foresee this model going away anytime soon, neither do we anticipate the end of full-time employment. Employers will almost certainly use each model to hedge against the challenges presented by the other.
The Rise of Flexible Staffing Models for IT
Right now, the technology landscape is changing faster than traditional hiring approaches can keep up. Advancements in AI, cloud, and cybersecurity are moving so quickly that skill needs can shift in a matter of months, not years. As such, many organizations are complementing their core full-time teams with contractors, project-based specialists, managed services, and other flexible staffing models to stay agile and maintain delivery performance.
Automation in Engineering: 5 Ethical Issues to Consider
Although automation is introducing major efficiency gains to engineering companies, there are also multiple ethical challenges that leaders can’t afford to ignore: job displacement, skill erosion, safety and accountability, and more. As companies consider where human insight and AI sit within the organization, this article identifies some areas where over-reliance on AI is not only wrong, but can be destructive to the business.
PEAK in 2025: A Year of Shared Success
Given the challenges and uncertainties 2025 has brought on our industry, we’re proud of several big wins from last year. Not just because of the hard work our team has put in, but because of the outcomes it has given all our clients, candidates, and partners.
Expanding Our Workforce Management Capabilities with New Acquisitions
At the beginning of the year, PEAK made a few strategic acquisitions that significantly expanded our scale, capabilities, and market reach. By joining forces with MegaForce, AdKore Staffing Group, and The Triple-I Corporation, we reinforced our commitment to creating greater value for candidates, clients, and employees through a more comprehensive set of workforce solutions.
How PEAK Built a Multi-Tiered Staffing Program for a Global Electronics Manufacturer
Additionally, we published a success story this past year about how we’ve helped a global electronics manufacturer successfully execute a major U.S. expansion by designing and managing a multi-tiered staffing program tailored to highly complex labor demands. Our end-to-end total staffing solution led to 120 successful placements across a range of roles over the past five years.
How PEAK Saved a Global Rail Company $2.4M While Increasing Fill Rates By 23%
We also wrote about our work with a global rail manufacturing company who we helped to overcome chronic talent shortages and escalating costs through a comprehensive Managed Staffing Program (MSP). As a result, PEAK saved the client $2.4 million in staffing costs (an 8% reduction) over 31 months.
Looking Ahead to 2026
Given the speed at which the industry moved in 2025, it’s safe to say that any predictions we make now will almost certainly be outdated by Q2. Still, here are a few things we anticipate happening:
- Uncertainty around trade policies, tariffs, and regulations will almost certainly continue into 2026, making strategic workforce planning an ongoing challenge
- Manufacturers and technology companies will continue expanding their domestic capacities, especially when it comes to AI data centers
- AI adoption will accelerate, causing some roles to fall out of favor but increasing demand for engineers who can design and govern automated systems safely and ethically
- Workforce strategies will continue to be flexible and multi-tiered, with an expansion of project-based and contingent staffing
If anything, staffing strategies will become more challenging in 2026, especially for niche or in-demand roles. As such, it’s always a great opportunity to have a staffing partner who has successfully navigated many similar shakeups and can position you for success going forward.