Press release

Gartner Says Companies in the U.S. Are Overpaying To Attract New Talent

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While compensation remains a top driver to attract and retain talent in
the U.S., employees only expect about a 10% salary increase to switch
employers, while companies are offering average compensation increases
around 15%, according to a recent survey by Gartner, Inc.

The latest data from Gartner’s 1Q19 Global Talent Monitor shows that
while many U.S. employers continue to extend lucrative compensation
offers to persuade workers to switch companies, the premiums to attract
talent might not be as high as employers think.

“Not only are U.S. employers often paying too much to new workers, but
once tenured employees discover discrepancies between their salaries and
those of new colleagues, they may be more inclined to look for another
position elsewhere,” said Brian
, group vice president in the Gartner HR practice.

Coinciding with employers’ generous compensation offers to attract
talent is the rise in the number of U.S. employees actively seeking
other employment. Gartner’s 1Q19 Global Talent Monitor reflected that
almost 25% of U.S. workers were actively looking for another job, a 7.6%
increase from last quarter but still lower than the global average of
27%. The report also found that only 43% of U.S. workers expressed a
high intent to stay with their current employers, a slight decrease from
4Q18 but significantly higher than the global average of 33%.

Business Confidence Is Up, For Now

The 1Q19 Global Talent Monitor reflects a slight 2.6% increase in
business confidence among U.S. employees from 4Q18, while the global
average dropped 1% during the same period. While the recent tariff
discussions are not yet impacting business confidence, this is an area
for employers to watch.

“Employee perceptions of the economy are primarily driven by how their
company is financially performing, and what they gather from news
cycles, which can lead to gossip and uncertainty if the employer isn’t
actively taking part in this inevitable dialogue,” said Mr. Kropp.
“Companies need to proactively communicate with their employees about
the current business plan and what will keep the organization
successful. By leading these conversations, employers can help diffuse
any potential workplace issues that might lead valuable talent to go

Workplace Strategies to Attract and Retain Talent

As the U.S. labor market remains tight with unemployment near all-time
lows and more job openings than job seekers, employers need to ensure
they are engaging their workers, by acknowledging hard work and
accomplishments and delivering the rewards that are most prized.

To establish the best chances for workplace success, Gartner recommends
companies develop a strong Employee
Value Proposition
(EVP) that concentrates on key categories that
employees and the labor market identify as valuable when working for an
organization, including competitive benefits and compensation, career
and development opportunities, job-interest alignment and work-life

“When companies invest and deliver a strong EVP, engagement levels in
their workforce will likely see a boost — not only in the ability to
retain talent, but also in attracting sought-after talent,” Mr. Kropp
added. “In this hypercompetitive U.S. labor market, organizations with
attractive EVPs can reduce the compensation premium needed to attract
qualified candidates as well as potentially decrease annual employee
turnover by just under 70%, all of which helps the company’s bottom line
and brand reputation.”

Global Talent Monitor data is drawn from the larger Gartner Global Labor
Market Survey that is sourced from more than 40,000 employees in 40
countries. The survey is conducted quarterly and is reflective of market
conditions during the quarter preceding publication.

About Gartner ReimagineHR

Gartner experts will provide additional insight into the labor and
talent issues at the Gartner ReimagineHR Conference, taking place
October 28-30 in Florida.
Gartner ReimagineHR is the premier event for HR leaders around the
world. Join Gartner and senior HR executives to hear key insights and
learn actionable strategies necessary to support organizational
performance. Gartner ReimagineHR will also be held August 6-7 in Sydney,
and September 18-19 in London.
Follow news and updates from these events on Twitter using #GartnerHR.

About Gartner for HR Leaders

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