Amidst a tough talent market, cultural markers of an organization including manager quality, respect and people management have become the biggest factors in retaining staff in Australia, according to Gartner, Inc.

The Gartner Global Labor Market Survey found manager quality is the top reason Australian employees cited for leaving their organization for the fifth consecutive quarter. Respect and people management have risen in importance for Australian workers, edging out compensation and work-life balance from the top three drivers of attrition (see Table 1).

Table 1: Top 10 Drivers of Employee Attraction and Attrition, Australia, Q1 2022

Source: Gartner Global Labor Market Survey, Q1 2022

The survey also shows that the job market still firmly favors job seekers. Employee confidence in job availability peaked at 56% in February, by far the highest it has been in more than five years. While overall business confidence fell by 9% in January as the Omicron variant took hold, it rose again during February and March. Business confidence for the quarter overall was down 6% from the last quarter of 2021.

The data collected in 1Q22 reveals that the proportion of employees showing high discretionary effort – willingness to go above and beyond at work – dropped within the quarter from 18.7% in February to 14.4% in March.

Additionally, the Gartner survey revealed that less than a third (29.6%) of Australian employees are highly engaged with their organization, and the proportion has steadily declined from the same time a year ago (37.2%).

Aaron McEwan, vice president in the Gartner HR practice, said the data shows Australian employers face an ultimatum: prioritize quality leadership and a positive work culture in your organization or risk losing staff to a highly competitive talent market.

“When it comes to staff retention, it’s not just how the individual experiences culture, it’s whether they see the right behavior and attitudes playing out around them, too,” said McEwan.

Location is key, but that doesn’t mean the office

Half of Australians surveyed by Gartner in the first quarter of 2022 ranked location in their top five reasons they would join an employer.

“Location has steadily risen in importance to Australians searching for a new job, but that doesn’t necessarily mean a swanky office in the heart of the city. Organizations must remember that workers are attracted to workplaces that embrace the ‘live and work anywhere’ philosophy, which we’ve seen increase over the pandemic,” said McEwan.

Flexibility and culture are not mutually exclusive

McEwan warns organizations that force a hard return to the office in an effort to restore culture risk losing their workforce. In fact, a 2021 Gartner survey revealed organizations that force their employees back to a fully on-site arrangement could lose 33% of their workforce.

“Organizational culture has changed irrevocably through the pandemic. It used to be marked by office banter, watercooler conversation and Friday drinks,” said McEwan. “If you take the office out of it, none of that matters much anymore. In a hybrid world, what’s left is behavior, attitudes, company values and the work itself.”

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