Compensation is the Key to Retention in a Competitive Market

In our 2024 Workforce Trends Report, we surveyed 500+ employees and job seekers to get their thoughts on several workplace-related topics, including what companies need to do to attract and retain top talent. One response was particularly interesting to us—and should be of some concern to employers:

63% of employees and job seekers surveyed are likely to consider taking another job opportunity in the next year and 36% are extremely likely to do this.

This response alone should raise red flags and set off alarm bells for U.S. employers who are already in a fierce competition to attract and retain top talent. What’s more, 67% of both employees and employers agreed that retaining and attracting talent over the next year will be challenging.

So, what can be done to ensure that more talent is walking in your doors than out? Well, it starts with offering the right compensation packages. In fact, in the same survey, 44% of employees and job seekers said that “increasing compensation” was most important to attracting and retaining talent. Additionally, 85% said that they expect their organization to offer salary increases in the next year.

Clearly, getting your compensation packages and salary offers right should be at the top of the list when developing your retention strategy, but let’s take a brief look beyond the paycheck to see what else you can do to round out your retention efforts.

Here’s what employees and job seekers said when we asked them “What steps would you want a company to take to attract and retain you?” (Note: “Increasing compensation” was the number one answer at 44%):

• 41% Offering better employer benefits
• 40% Allowing more flexibility (work location or schedule)
• 33% Offering new professional development opportunities

Additionally, here’s what employees and job seekers said when we asked them “Outside of compensation, what makes people want to work at an organization?”

• 39% Good workplace culture
• 34% Strong leadership team
• 32% Flexible/remote working options
• 31% Generous paid time off

Things like better benefits and generous PTO are staples of a successful retention strategy. However, don’t overlook flexible work options—for employees whose job can be performed on- and offsite—as a good perk to offer (35% of employees told us they are interested in hybrid work options). Additionally, take a good look at the leaders in your organization and ensure that they are trustworthy, supportive, and can articulate and execute a strong organizational vision. It's clear that top talent wants to work for and with top leaders.

The Right Salaries are Key to an Effective Retention Strategy

At LHH, we understand competitive compensation is the most critical component in your retention strategy. That’s why we take great care to source the most reliable and current salary data for you. However, because we know today’s top talent expects benefits beyond the paycheck, we can also help you develop a strong non-comp benefits package.

Get the salary info you need to improve your salary offers and retain your top talent—download your free copy of our 2024 Salary Guide now.