Four ways to sweeten the deal to attract and retain talent 

Yet our 2024 Global Talent Trends study shows that with an estimated turnover rate of 19%, the “leaky talent bucket” continues to be a hindrance.

For employees, the desire to leave is tied to career trajectory. The number-one reason talent heads out the door is that career advancement either isn’t available or takes too long. Although the need for a higher pay packet comes in second, a close third is a lack of learning and development. Employees know that “topping up” their skills unlocks higher salaries, and continuous learning is the bedrock of a fulfilling career.

However, many people feel they have yet to reach their full potential at work. Their career ambitions aren’t being satisfied, and, often, work still doesn’t flex to complement the priorities in their personal lives. It’s a recipe for a disengaged, unfulfilled workforce. In fact, the second biggest driver of engagement is people feeling they can reach their full potential.

It’s up to executives, HR and people managers to prioritize the career experience. Doing so will not only drive fulfilment, but it will also address the all-too-present challenges of employee turnover and low productivity while improving talent attraction in a tense labor market. 

To keep the employee deal sweet, leaders will need to zero in on four key areas to create a winning career experience:

1. Craft squiggly careers
2. Utilize the power of skills
3. Establish an enabling infrastructure
4. Champion choice through culture

Read on to discover why each of these areas is essential and, most important, how to focus on them.

Employees’ desire to be masters of their own destinies reflects what we at Mercer call the lifestyle contract, where employees want a healthy work life in exchange for their sustainable performance. In fact, employees who feel they’re thriving at work are 1.6 times as likely to feel they’re in control of their careers. As part of this, employees want flexibility so they can make work work for them, whatever their role or life stage. 

The lifestyle contract means that “squigglier” career paths have become the norm as the vertical career ladder increasingly becomes an artifact of the past. A career sidestep, rather than jumping through hoops to climb up an outdated business hierarchy, can feel more fulfilling. 

A varied career path holds tremendous potential for employees but can be overwhelming without clear guidance. Imagine the workplace equivalent of a customer walking into a candy store, seeing colorful treats piled up high but no signage and no shopkeeper to recommend the flavors that will suit their tastes. 

The rise of AI and automation has accelerated the shift to the lifestyle contract, with the World Economic Forum pointing to 44% of workers’ skills being disrupted within five years. Transparency about the value of certain skills in the future is crucial.

Becoming a skills-powered organization requires transformation and stakeholder buy-in before the potential can be realized. Roughly two in three employers are already integrating skills in career management, talent acquisition and performance management. Why? Because skills enable baked-in agility. Employers can quickly pivot strategies in response to market disruptions or shifts in demand. Having clear skills data is the first step on this journey.

Internal talent marketplaces are platforms many employers are exploring today, with more than one-third (35%) already benefiting from this approach. Platforms such as Gloat and Eightfold can enable skills-powered organizations by organizing and governing skills and uncovering gaps. These platforms are sometimes deployed for pilot job families or for specific types of talent (such as digital talent).

Talent marketplaces enable career mobility, helping employees understand the opportunities available, what skills they need and what skills they bring to the table. Think of it as each employee creating their own personal career pick ’n’ mix.  

As we’ve said, helping employees get a taste of what else is out there via an internal talent marketplace will benefit the wider business and make for more fulfilled teams. But despite implementing new tools to democratize opportunity, some managers have picked up a bad habit: They’re “hoarding” talent in their teams and struggling to empower people to pursue new internal opportunities. This is understandable — especially if the team is thriving and performing well. But in a skills-first model, sharing is caring.

Refining cultural values and incentivizing talent sharing will mean better employer–employee partnerships so talent can grow careers that work for both parties. 

At the heart of new ways of working are varied careers, skills data, mobility-driving infrastructure and an empowering culture — all of these work together to create a winning career experience. Making the switch to a skills-first model is a great way to create an experience that delights employees through championing individual agency and strengthening the employer–employee partnership.