source: https://www.littler.com/sites/default/files/2026-02/2026_littler_wpi_survey_report.pdf

WASHINGTON — Diversity, equity and inclusion initiatives and immigration policy changes were the most significant workplace issues affecting U.S. employers in 2025, according to a survey released by the Littler Workplace Policy Institute in March 2026. The report found companies are adjusting hiring practices, workplace policies and compliance strategies amid regulatory changes and economic uncertainty, March 2026.

DEI and immigration policies dominate employer concerns

The survey of 306 legal, human resources, and business leaders across the United States found 71% of employers identified DEI policies as having the greatest impact on their workplaces during the first year of President Donald Trump’s second administration. Immigration policy followed at 65%, making the two issues significantly more influential than any other workplace regulatory area.

Other policy areas ranked lower:

• Employee health insurance: 30%
• Artificial intelligence in the workplace: 30%
• Wage and hour practices: 28%
• LGBTQ protections: 21%
• Labor relations or union activity: 15%

Large organizations reported experiencing stronger impacts than smaller employers.

Policy changes spark reassessment of DEI programs

Recent federal policy changes have created uncertainty around DEI programs. The report cited executive actions that ended DEI programs in government, reversed affirmative action requirements for federal contractors and increased scrutiny of private-sector DEI initiatives.

As a result, 55% of employers said they have considered scaling back DEI programs. Among large organizations, 60% reported concern about potential litigation related to DEI initiatives.

Legal challenges to some of the federal policy changes remain ongoing.

Immigration policy affects hiring and staffing

Immigration policy shifts also created significant workforce challenges. Sixty-three percent of employers reported staffing difficulties tied to immigration policy changes, increasing to 75% among large companies.

Some employers reported responding by:

• Hiring based on immigration eligibility
• Reducing immigration sponsorship
• Ending H-1B visa sponsorship

The impacts were especially pronounced in technology, retail and hospitality, where 81% of employers reported effects from immigration policy changes.

Employers adjust workforce strategies amid uncertainty

Economic uncertainty and regulatory changes also influenced employer decisions about staffing and compensation.

According to the survey:

• 35% reduced their workforce
• 30% paused or reduced hiring
• 18% reduced workplace perks
• 17% delayed promotions or pay increases
• 13% reduced bonuses

However, 40% of employers reported making no operational changes.

Manufacturing firms reported some of the strongest responses, with 41% reducing their workforce and 43% pausing hiring. The report attributed these decisions to economic uncertainty, trade policy changes and the adoption of artificial intelligence.

In contrast, sectors such as health care continue hiring because of ongoing labor shortages.

State and local laws create growing compliance challenges

The report found that state and local workplace laws are affecting nearly 90% of employers, highlighting the growing influence of state-level regulation.

Employers reported the following levels of impact:

• 17% said the impact was large
• 37% said it was moderate
• 35% said it was small
• 11% reported no impact

The most affected policy areas included:

• Paid leave policies (67%)
• Pay equity and pay transparency (51%)
• Data privacy (47%)
• Artificial intelligence in employment processes (41%)
• Minimum wage standards (40%)

The report noted that this expanding patchwork of state regulations has increased compliance complexity for employers operating across multiple jurisdictions.

Federal agencies to watch in 2026

The Littler Workplace Policy Institute identified several federal agencies likely to influence workplace policy developments in 2026.

Equal Employment Opportunity Commission (EEOC)
The agency may increase enforcement activity and litigation authority while focusing on LGBTQ protections, religious accommodations and the Pregnant Workers Fairness Act. The EEOC recently rescinded its harassment guidance.

National Labor Relations Board (NLRB)
Possible developments include new board appointments, renewed rulemaking activity and potential regulations addressing worker classification, union representation procedures and campaign speech rules.

Department of Labor (DOL)
The department is expected to address worker classification, joint employment standards and minimum wages for federal contractors.

Employers face complex policy landscape

Overall, the survey suggests employers are navigating a workplace environment shaped by regulatory shifts, economic uncertainty and evolving labor policies.

With federal policy changes, expanding state regulations and workforce challenges occurring simultaneously, many organizations are preparing for continued adjustments to workplace strategies throughout 2026.