With more jobs available than there are workers to fill them and low U.S. unemployment rates holding steady, organizations are facing increasing complexity around compensating new hires versus current employees, according to Gartner, Inc.
The latest data from Gartner’s 4Q18 Global Talent Monitor report shows that compensation remains a top driver to attract and retain talent in the U.S. In an effort to win more of the critical talent they need, employers are offering higher salaries to lure these candidates away from their current organizations.
“Compensation has become tricky for many companies who are trying to both attract new talent, but also keep their best workers in-seat,” said Brian Kropp, group vice president of Gartner’s HR practice. “Globally, workers expect significant compensation increases of 15.5 percent to switch companies, and the annual wage increases that companies currently offer will never match that. The result is a new wage gap that is forming where new employees are paid more, sometimes significantly more, than tenured employees.”
Talent Retention Should Remain a Priority
Data from the 4Q18 Global Talent Monitor reflects that more U.S. employees plan to remain at their current organization, and they are doing more than is required in their jobs. Forty-four percent of U.S. workers intend to stay in their current roles, a 4 percent increase from last quarter and more than 11 percent higher than the global average. In addition, almost 19 percent of U.S. employees indicated a high willingness to go above and beyond at work, with 78 percent of these workers expressing a high or somewhat high intent to stay at their current organizations.
“With more employees planning to stay in current roles, and increasing their discretionary effort at work, employers should consider how best to engage and retain their current workforce,” said Mr. Kropp.
Strategies to Engage, Attract and Retain Talent
Acknowledgments of accomplishments and distribution of rewards play very significant roles in growing morale and retaining employees. When workers hear first-hand from management how important their workplace contributions are to the overall success of the company, they become more connected to the company and its culture.
Gartner recommends employers implement a robust Employee Value Proposition (EVP) that focuses on those key attributes which the labor market and employees perceive as valuable to the workforce, including career development opportunities, competitive wages and benefits packages, and work-life balance.
“The U.S. labor market remains at a hypercompetitive level, with companies looking to define their employment brand as superior over the competition,” Mr. Kropp added. “Through the establishment of an EVP which incorporates attributes workers find meaningful, companies can increase employee engagement levels, reduce attrition rates and attract much-needed talent. Gartner data illustrates organizations that effectively deliver on their EVP can decrease annual employee turnover by just under 70 percent and increase new hire commitment by nearly 30 percent – which has a direct impact on the company’s bottom line.”
Global Talent Monitor data is drawn from the larger Gartner Global Labor Market Survey that is sourced from more than 22,000 employees in 40 countries. The survey is conducted quarterly and is reflective of market conditions during the quarter preceding publication.