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Retention Oct 1, 2024 · 2 min read

Employee Retention is Shifting in Priority–But Still Critical

WorkBuzz
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Employee retention, once a top three priority for organizations has seen a surprising shift. According to our 2024 State of Employee Engagement report, retention has dropped eight places on the priority list compared to previous years. But here’s the kicker—data from the Society for Human Resource Management (SHRM) shows the cost of replacing an employee can be as high as six to nine months of their salary. So why the change? And what does it mean for businesses navigating the modern workforce?

While retention remains a critical challenge–both from a financial and cultural perspective–our data shows that HR leaders must adapt their strategies to align with a new workforce reality. 

Key Points:

  • A Shift in Priorities: Employees now have higher expectations for their work environment – work has become more than just a paycheck.
  • Prepare Yourself for the Future: The key to retaining today’s talent is to offer employees what they truly value.  

The New Rules of Retention: Why Priorities Have Shifted

The workforce of today isn’t the workforce of even a few years ago. Millennials and Gen Z—who now make up more than 50% of today’s employees according to Visual Capitalist—have vastly different expectations for their careers. The days of people staying in a job for decades with just a steady paycheck as motivation are over. Instead, these generations want more. Flexibility. Purpose. Career development. They're also looking for jobs that are closely aligned with their values. A prime example of this can be seen in a recent Deloitte study where they found 44% of Gen Zs and 37% of Millennials to have rejected job opportunities or assignments due to ethical concerns.

This is why traditional retention strategies have become less effective, and instead, organizations are having to turn to more individualized approaches to meet the unique needs of their employees. The solution? Rather than focusing on generic strategies businesses need to rethink how they engage and support their workforce across different generations and adhere to their needs.

A barista in a cafe prepares drinks behind the counter.

The Future of Retention Is Here: Ignore at Your Own Risk

Retention may have slipped down the priority list, but make no mistake—ignoring it is a gamble. Retaining talent is still crucial for the long-term success of any organization, and HR leaders need to respond to and understand the evolving needs of employees in a more human-centric way.

It’s not about quick fixes anymore. The key to mapping out the future of retention lies in offering employees what they truly value, creating a workplace that makes employees feel valued, supported, and motivated to stay.

Learn more about the evolving needs of employees and strategies to support them in our latest report, The State of Employee Engagement 2024/25.