With employee retention high, it’s critical to build from within
The second half of 2024 is expected to be a period of high employee retention according to trends across the Eagle Hill Consulting Employee Retention Index. The Employee Retention Index has trended upward and reached its highest level to date in Q2 2024. This signals that workers are increasingly likely to stay in their jobs. We expect this upward trend to continue through the end of the year.
This high retention environment offers organizations a respite from the challenges of the Great Resignation. However, it isn’t a time for rest. Far from it. This is a unique period that brings its own set of opportunities—and challenges.
Not surprisingly, there is a lot that is positive about a period of high employee retention. There is more workforce continuity and less knowledge drain. As such, organizations can expect better ROI in workforce development initiatives such as training and upskilling, knowledge transfer, and succession planning. They can also be proactive rather than reactive in how they plan for and target these initiatives.
This period of relative workforce stability is an excellent time to focus on strategic initiatives that get deprioritized during times of high turnover. This can include driving innovation, improving internal processes, increasing employee morale, and doubling down on achieving long-term goals. Organizations finally have the chance to implement changes that they hesitate to make during times of high turnover for fear of driving more attrition.
At the same time, higher retention means there is less talent in the market, which makes it harder for organizations to recruit and hire for open strategic positions. That’s why it’s so important to build from within, to engage and grow current employees, while being conscious of providing career paths for staff when attrition doesn’t provide natural opportunities for advancement. This means prioritizing internal mobility and upskilling while keeping a pulse on employee feedback. Even though employees are more likely to stay, organizations can’t get complacent. They have to be proactive to avoid issues like employee burnout, decreased engagement, and “quiet quitting.” This is crucial for maintaining job security and ensuring that the organization’s ability to retain employees remains strong.
“With employees staying put, organizations need to make the most of this quiet period to develop their people, drive innovation, and thrive in a tight talent market. This is the ideal time for leaders to strategically address their workforce.”
Jonathan Gove
Senior Human Capital Director, Eagle Hill Consulting
Key retention strategies to get ahead in a period of reduced turnover
Organizations should act now to approach the high retention environment differently. This is a time for an inward focus on foundational aspects of the business. Namely, the people and the strategy—and preparing both for the future. Start with these priorities:
1
Get serious about getting strategic
Use this time to undertake strategic initiatives such as return to office, restructuring, or productivity improvement. Explore and consider relaunching initiatives that have been postponed in anticipation of employee pushback or resistance to change. Determine if it makes strategic sense to move forward on less popular but valuable initiatives over the next six months. As much as possible, work in partnership with the workforce. Involve them in solutioning and implementing solutions to optimize engagement and build trust and confidence.
2
Create a foundation for the future
Focus on training, development, and upskilling for the future. Consider investing in hard-to-find skills that are in high demand, such as artificial intelligence and other technology skills. Take advantage of workforce stability to build technology skills and implement new, future-ready technology tools. Push forward on this even if the training curve may cause minor friction with some employees. Simultaneously invest in the organization’s future leaders, tackling barriers to career development and advancement presented by low attrition. Embrace internal mobility and develop solid succession plans. Remember that both upward and lateral mobility can contribute to employee satisfaction and skill building; lateral mobility can support innovation and help circulate fresh ideas across teams.
3
Work within today’s talent market
Adjust to a market in which talent and skills are less readily available. Prepare for longer lead timeframes for filling positions. Consider “building skills” over the next six months instead of “buying them,” taking an objective view of barriers to advancement that exist in the organization. Dive deep into how internal mobility works in the organization to address what’s constraining employee development. If buying skills is critical, look at non-traditional recruiting sources and prioritize the most strategic hires so that recruiting horsepower is focused on fewer, but more critical, roles.
4
Emphasize the human experience
Keep a pulse on employee satisfaction—burnout is real. Our research shows that 45% of the U.S. workforce reports feeling burnout. The good news? With the Culture Indicator high, employee views on connection, feeling valued and recognized, and overall company culture are improving. Find out what’s contributing to this in your organization and build on it to improve engagement. Conduct stay interviews (one-on-one conversations between employees and managers around what is and isn’t working) to motivate people to stay. Discover what parts of the culture employees like and where they see a need for improvement.
Building from within is a powerful way to drive an organization forward. It’s not always feasible, but in today’s high retention environment, it can be. Organizations that commit to doing this will do right by their people—and by the business. Learn how Eagle Hill’s talent strategy consulting services can assist.
Related services and insights
Talent strategyWhy Gen Z is a retention outlier—and what to do about it
