With the latest innovations in AI beginning to deliver in the operational sphere, manufacturers are looking for what’s next. Increased competition, shifts in facility size or location, and growing external pressures are refocusing attention on talent. How can manufacturers find the right talent – the age-old question and issue that perplexed many during the last few years – and how can teams operate more efficiently to do so?

Human Resources (HR) leaders are asking what AI can do for their function. To explore how AI is expanding within HR functions, Manufacturers Alliance Foundation partnered with American Fidelity and surveyed 135 U.S.-based manufacturing companies and spoke directly with executives on where departments are deploying AI, how it’s making a difference, and near and long-term department expectations. 

There is natural reluctance to take the “H” out of HR when it’s already a challenge to attract, develop, and retain qualified talent. But top-level findings reveal that the AI journey is already well underway, as nearly all plan to use or currently use AI. 

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Most Teams Believe AI Can Enhance Workforce Strategies

Source: Manufacturers Alliance Foundation study, 2025

Recruiting is the number one focus for most companies due to the difficulty of sourcing the right talent and the substantial workflow involved. 

The notable cases of AI in recruiting are skill assessments, matching algorithms, and interview scheduling. But don’t trust them yet. HR leaders are wary that AI cannot be fully relied on without some human checks, nor can it measure important considerations like culture and personality.

Too often onboarding is a weak point in the workflow, delivering a mass of information and missing opportunities to check in with new employees. More than two-thirds of manufacturers say they are planning or currently use AI systems to create mentoring relationships during onboarding, and some have implemented chatbots and customized, yet automated, messages. AI’s role is clear, facilitating the goals of increased communication and access, but leaders believe companies must guard against losing human touch by relying too heavily on AI during onboarding.

Lastly, it’s all about keeping the right talent. In a tight labor market, small details matter. More than three-quarters of respondents believe that AI can assist in creating in-person touch points to increase employee awareness of benefits, aiding those with competition nearby. AI may also help teams increase action from employee surveys, capturing the needs of employees and tracking insight-driven engagement action plans.

Despite the benefits of AI, more than half of respondents were concerned that using AI for hiring and retention may result in the loss of a human touch. “I think there should be a combination of technology–which will be advancing–and accessibility of talking to a real person,” Irina Feldman, Vice President of HR for Metal Processing Group said. “And those real people need to know, by watching the data, that a person may need human interaction.”

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Manufacturers aren’t transforming their HR teams into robots anytime soon, rather layering AI enhancements into existing tools and continuing to learn what works, and what doesn’t, along the way. With limited budget for 47% of respondents, implementation and maintenance is a problem. Finding the balance between AI in HR and preserving the human touch will take considerable care.

About American Fidelity

American Fidelity can help extend the reach of your HR team to every employee, supporting a culture where employees feel secure and valued. We can help you leverage your benefits program to empower employees, enrich company culture and improve employee loyalty. For more than 60 years we’ve helped organizations elevate their benefits strategy, and we can help yours too. For more information, visit americanfidelity.com.