Talent and Leadership Trends in 2026: what business leaders must prepare for

At the start of 2026, the conversations I am having with business leaders feel different from those of previous years. Over the last 12 months, I’ve found myself having more open, honest conversations with board members and leadership teams than ever before.​

There is a sharper focus on risk, resilience, and long-term capability. The uncertainty that dominated decision-making post-pandemic has not disappeared, but it has matured. Leaders are no longer simply reacting to change. In fact, while the UK economy is expected to continue growing, some forecasts suggest a slowdown to 1% GDP growth in 2026, meaning strategic talent decisions are more vital than ever.

From my perspective, there are five key shifts that will define how organisations approach talent in 2026.

Greater investment in people

With less hiring and people being more risk-conscious when considering potential moves, companies will invest more in developing their own people through programmes around training, coaching, development and succession planning.

We’re already seeing this play out across sectors. Instead of relying on external hires to plug gaps, organisations are looking inward. The emphasis is shifting towards identifying leadership potential early, accelerating development, and building internal pipelines. This is not only a response to tighter markets but also a recognition that retention and growth are inseparable.

This focus on internal growth is reflected in market forecasts. Findings from Business Gateway in July 2025 reveal that the UK coaching sector alone is projected to grow by an annual rate of 7.29% between 2025 and 2029.

How AI will reshape leadership and talent decisions in 2026

More investment in effective and intelligent use of AI, rather than seeing it as a way to replace operational employees or processes. In 2026, the fastest growing companies will be those who use their experience and knowledge to get the best of AI.

The narrative around AI is also changing. The initial excitement focused on automation and replacement. What I am seeing now is a more thoughtful approach. Organisations are asking how AI can enhance decision-making, improve insight, and scale expertise without losing the human element that underpins strong leadership. In my conversations with clients, the most impressive leaders are not asking what AI can remove, but how it can support and drive growth.

Blurring of consulting and search.

Why executive search is merging with leadership consulting ​

Clients increasingly look to buy multi-service packages. This includes leadership assessment, coaching, development packages and onboarding support. More and more clients are moving away from standalone Executive Search, wanting to mitigate risk and accelerate success in key senior hires.

This is one of the most significant shifts in the market. Senior hires are too critical to leave to chance. Businesses want continuity of support before, during, and after the appointment. The lines are blurring between hiring, onboarding, development, and long-term performance. That integrated view is fast becoming the norm rather than the exception.

Talent intelligence becoming a core service line

Clients today want data-rich market maps, competitor talent analysis, remuneration surveys, role re-design, and benchmarking insights as part of every Search mandate. Today, data is no longer a nice-to-have. It’s central to decision-making. Clients want clarity on where talent sits in the market, what ‘good’ really looks like, and how competitive their propositions are. That level of intelligence is shaping not only hiring, but also how roles themselves are designed. 

The crunch on tech talent.

Tech talent shortages and the rise of interim leadership models

As digitisation continues apace, the top technologists remain hard to engage and expensive to employ. The dearth of talent in security, infrastructure modernisation, and edge computing means the need for a specialised partner with strong networks and market access is key, as is the need to have a strong marketing message. This also drives an increased need for more fractional and interim executive resource, especially for early-stage and scale-up tech.

This pressure is not easing. If anything, it will intensify. The organisations that succeed throughout 2026 will be those who combine strong networks, credible market messaging, and flexible models of engaging leadership talent.

My final thoughts

As we enter 2026, the organisations that will stand out are those that take a long-term view of people, leadership, and capability. Here at Morgan Philips, our role is to help clients move beyond transactional hiring and towards integrated, future-focused talent strategies that reduce risk, accelerate impact, and build resilience.