What We’re Seeing Right Now: Top HR Challenges for Growing Businesses

We recently had the opportunity to join Doug Grawe from The Grawe Group on his podcast to talk through the top HR challenges businesses are navigating right now and it felt very aligned with the conversations we’re having with clients every day.

If you want to hear the full discussion, you can listen here: Insights on Navigating the Top HR Challenges in Today’s Business Landscape

For those of you who prefer a quick read, here are a few of the biggest themes we’re continuing to see across growing organizations.

1. HR needs grow faster than most businesses expect

One of the biggest challenges for small and mid-sized businesses is how quickly HR complexity increases.

It often starts simple, hiring a few employees, managing day-to-day issues but then quickly turns into:

• Compliance questions

• Documentation needs

• Employee relations issues

• Process gaps

This is especially true for businesses under 100 employees, where there often isn’t a dedicated HR function yet.

2. Multi-state employment adds a layer of complexity

As more companies hire remotely or expand into new markets, multi-state employment has become one of the most common challenges we see.

Each state brings:

• Different labor laws

• Payroll requirements

• Leave policies

• Onboarding requirements

Even one out-of-state employee can create new compliance obligations and without a clear approach, it’s easy for risk to build quickly.

3. Compliance isn’t just about having policies

A big misconception is that compliance is “set it and forget it.”

In reality:

• Laws are constantly evolving

• Requirements differ by state

• Policies need to reflect real-world situations

We talked in the podcast about how important it is to stay ahead of changes, like newer state-level legislation (including paid leave requirements), because waiting until there’s an issue is often too late.

4. Businesses need continuity in HR support

Another theme we discussed is something that doesn’t get talked about enough:

What happens when HR support isn’t consistent?

Without clear processes or internal backups:

• Things fall through the cracks

• Transitions get messy

• Risk increases

Having some level of structure, or a partner to help support that, can make a significant difference in keeping things running smoothly.

5. AI is changing HR—whether businesses are ready or not

AI continues to come up in almost every conversation we’re having right now.

What we’re seeing:

• Companies are starting to explore AI tools

• There’s uncertainty around how to use them appropriately

• Policies and guidance often aren’t in place yet

The takeaway is not that businesses need to have it all figured out but that they need to start thinking about how AI fits into their HR practices and how to stay adaptable as things evolve.

Final thoughts

If there’s one common thread across all of these challenges, it’s this:

Most growing businesses aren’t lacking effort; they’re lacking clarity and consistent support.

HR doesn’t need to feel overwhelming, but it does need to be intentional.

If you’re navigating similar challenges in your business, you’re not alone, these are the exact situations we help clients work through every day.