From Attraction to Retention: HR’s New Talent Challenge

By late 2022, many UK employers faced a tightening labour market that tested both recruitment capability and the staying power of top performers. Senior and skilled roles proved particularly challenging to fill, as competition for scarce talent intensified and employees exhibited higher expectations for development, recognition, and flexible working. In response, HR leaders began shifting focus from short-term attraction tactics to longer-term retention strategies, recognising that keeping great people is often more cost-effective than constant hiring.

Data and trends behind retention challenges in 2022

Understanding the retention landscape required a close look at workforce data. Turnover in high‑skill areas rose as job seekers weighed total rewards, work-life balance, and opportunities for meaningful progression. Engagement surveys highlighted a demand for clearer career pathways and more transparent communication from leadership. Meanwhile, external factors such as salary benchmarks, cost‑of‑living pressures, and industry competitiveness contributed to a more dynamic talent market. This combination of factors underscored the need for HR to act as a proactive partner in workforce planning, not just a reactive facilitator of hires.

Practical retention levers: flexibility, development, recognition, and pay

Flexibility emerged as a central retention lever. Flexible working arrangements, hybrid models, and outcome‑based performance measures helped organisations maintain productivity while supporting employee well‑being and personal commitments. Career development gained fresh importance; staff sought structured development plans, access to mentoring, and opportunities to upskill in line with evolving business needs. Recognition programmes—from formal high‑potential tracks to regular, meaningful feedback—became essential for reinforcing value and loyalty. Competitive and transparent pay structures, including merit-based progression and market-aligned salary bands, also played a critical role in reducing attrition and attracting new talent.

How HR can partner with leadership to build a compelling employee experience

Creating an engaging employee experience requires close alignment between HR, line managers, and senior leadership. HR can lead the design of an organisation-wide EVP (employee value proposition) that clearly communicates growth opportunities, culture, and rewards. Regular leadership communications reinforce strategic priorities and ensure that policies get translated into day‑to‑day practice. Cross‑functional collaboration helps identify friction points in the employee journey—recruitment, onboarding, performance management, promotion, and retention—and implement targeted improvements. By embedding a retention mindset into governance and planning, HR ensures that decisions support both immediate needs and long-term capability building.

Practical steps for organisations

• Map critical roles and existing succession pathways to identify gaps in coverage and development needs.

• Develop flexible working policies that balance business requirements with employee preferences, accompanied by clear performance expectations.

• Invest in targeted development programmes, including leadership coaching, technical upskilling, and mentorship.

• Create transparent recognition and progression frameworks that tie rewards to demonstrated impact and potential.

• Use people analytics to monitor turnover drivers, measure the effectiveness of retention initiatives, and adjust strategies in real time.

Partnerships that drive sustainable outcomes

A lasting retention strategy depends on strong collaboration between HR, executives, and managers. HR should act as a strategic adviser, helping leadership understand where retention risks lie and how to deploy resources effectively. Managers, equipped with the right coaching and tools, can foster daily engagement, provide meaningful feedback, and champion opportunities for professional growth. When retention becomes a shared priority across the leadership team, organisations gain a more resilient workforce capable of navigating change and sustaining performance.

The value of a robust employee experience

Retention is more than reducing turnover; it’s about building an organisation where employees feel valued, challenged, and connected to a meaningful purpose. By prioritising flexibility, development, recognition, and fair compensation, UK organisations can strengthen loyalty, reduce the costs and disruption of turnover, and maintain continuity in key roles. In a competitive market, retaining strategic talent supports faster growth, smoother transformation, and a more agile response to future challenges.

As the talent landscape continues to evolve, those organisations that embed retention into their people strategy will likely outperform peers. By aligning data-driven insights with practical actions and leadership partnership, HR can transform the challenge of talent scarcity into an opportunity for stronger, more engaged workforces.