AI in Human Resource Management: A Narrative Review of Balancing Opportunities and Risks for the Future of Work

Artificial Intelligence (AI) is significantly changing Human Resource Management (HRM) and is creating both opportunities and challenges for organizations. Although it is changing the way human resource managers perform their tasks, it is also creating a number of challenges that are of concern to managers. This study aims to provide a narrative review of the two-way impact of AI in HRM. It is highlighting its benefits to organizational effectiveness and also showing the key challenges that are of concern to managers. Based on recent literature (2021-2025), this narrative review is a synthesis of various ideas in various areas of human resource management, such as recruitment, training, performance management, and employee engagement. The results showed that AI is beneficial in that it increases organizational effectiveness and strategic decision-making. It is also creating inequalities, resistance from employees, and ethical challenges. The contribution of the paper is in offering a conceptual framework that places HR practices at the center of AI opportunities and risks, underlining the need for a balanced and hybrid approach to AI efficiency and human oversight. The contribution of the review to HRM theory is in linking AI adoption to sustainability and ethical governance. This is achieved by offering practical implications for managers and regulators. The study underlines that the future of HRM is not in automation but in developing responsible, inclusive, and sustainable AI-driven practices.