World of HR: 69% of EU employers have or will rollback DEI because of the Trump administration

Employers in the European Union (EU) have a lot on the horizon when it comes to AI and DEI, thanks to new regulations both at home and across the Atlantic, according to the 2025 European Employer Survey Report from Littler.

New AI regulations. Certain provisions of the EU AI Act go into effect in August 2026, stipulating that employers in the region must use human oversight with AI. But many aren’t ready. One in five employers said they are “not at all” prepared to comply with the AI Act, unchanged from 2024, and 49% are at least “moderately prepared” for the changes, up from 44%. Regardless of readiness, 58% of employers expect AI-related regulatory changes next year.

AI is also influencing how companies in the EU build their talent strategy. The majority of employers (71%) are or are considering reassessing employee job responsibilities, while 28% said they have or will reduce hiring and 13% have already reduced their workforce due to AI.

The US effect. One in four of employers in the EU have reduced or canceled business travel to and operations in the US because of the Trump administration’s policy changes, the survey found. One in five employers have “paused or reduced” hiring in the US, and many pointed to the US immigration (32%) and DEI (36%) policy changes as the reason.

“US policies are creating significant hurdles for European employers with US operations, many of whom must reassess not only employee travel plans but US-based contracts, investments and growth opportunities,” Stephan C. Swinkels, partner and co-lead of global practice at Littler, said in the report.

But US policies aren’t just impacting how EU businesses operate in the US: 69% of EU employers with DEI policies said they have or will shift them because of “heightened scrutiny” from the Trump administration. Nearly half of organizations that operate in the US reported moderate to large challenges with multiple DEI approaches, influenced by the Trump administration’s position on DEI.

“Straddling the gap between US and European [DEI] policies makes a global approach almost impossible for today’s multinational employers,” the report said. “Employers must consider their current and planned DEI practices in light of the new political environment and upcoming legal requirements.”