Employees caught in 'stay or go' paralysis, according to new report
The intent to stay among Australian employees dropped to its lowest point in three years amid financial instability, according to a new report.
Findings from Gartner's latest Global Talent Monitor have shown that Australian workers' intent to stay in their current workplace dropped to 32.9% in the first quarter of 2025.
This is a decrease from 45.1% in the second quarter of 2022, despite job availability confidence at 57.5% and the prospect of increased remuneration from changing employers at 8.3%.
The findings come in the wake of financial instability among employees, according to Gartner, which found that compensation is consistently in the top three drivers of attraction and attrition.
"Current financial instability is placing significant pressure on Australian employees, yet they're caught in a 'stay or go' paralysis based on achieving anticipated compensation gains," said Neal Woolrich, Director, Advisory in the Gartner HR practice, in a statement.
"This can create an unproductive and sometimes toxic environment, making it critical for organisations to focus on tackling potential workforce performance issues."
Another outcome from constrained pay is further attention to other aspects at work, according to Woolrich.
"When pay is constrained and organisations have limitations on what they can do to improve this, employees start focusing their attention on what else is going on in the workplace, such as the reputation of senior leadership, ethical culture and workplace integrity," he said.
Woolrich then said these factors become major influences on their decision on whether to stay or go.
In fact, Gartner's report found that work-life balance is the top driver of attraction in workplaces, surpassing compensation, in the wake of shifting policies in Australia.
The government recently implemented a Right to Disconnect for Australian employees, but a recent Rippling survey found that 26% of workplaces have yet to roll out a clear policy guaranteeing off-hours protection.
Office-return mandates in Australia are also on the rise, with 39% of business leaders already mandating in-office days and 40% more planning to do so, according to Robert Half.
"Many organisations are implementing or considering return-to-office mandates as a way to drive collaboration, productivity and a sense of connectedness. But what matters is not where work gets done, but how work gets done," Woolrich said.
"The most critical ingredient is a collaborative team culture."
Manager quality also emerged as the top driver for attrition, just above compensation, while senior leadership reputation went up four spots to land in the top 10 factors.
"A respected leader boosts morale and helps foster a culture of motivation and loyalty," Woolrich said. "During a time of great uncertainty, organisations that focus on providing this to their workforce are more likely to create an environment that is fair, with engaged and higher performing employees."
Global Talent Scouts, a global staffing service firm, said offering competitive compensation and benefits is one way to attract and retain top talent.
But it also outlined on LinkedIn other measures that employers can implement to reduce employee turnover this year. They are:
"By focusing on competitive compensation, career growth, positive culture, strong leadership, and feedback, organizations can significantly reduce turnover and build a more stable, engaged workforce," it said on LinkedIn.
