In today’s market, retention isn’t just a lingering concern — it’s a strategic imperative. Even as hiring cools in many sectors, 54% of CHROs still rank retention among their top concerns, up three points from 2023, according to the 2024-2025 HRO Today Annual North America and EMEA CHRO Survey, sponsored by Hudson Talent Solutions. For CEOs and CHROs, the stakes are clear: losing top talent can undercut long-term growth, innovation, and competitiveness.
Why Retention Remains a Top Concern
While global unemployment remains low by historical standards, economic uncertainty and market volatility are reshaping how employees view their options. In many industries, tight job markets actually reduce turnover risk, with employees reluctant to make moves. However, that’s no cause for complacency. A sudden rebound in hiring, or emerging competitors with compelling offers, can quickly change the dynamic. A fragile sense of security can quickly reverse, leaving organizations vulnerable when economic conditions shift.
The cost of turnover remains steep: from productivity disruptions to recruiting and onboarding expenses often total 50–200% of an employee’s annual salary. Poor retention strategies can undermine an employer brand and force companies to chase replacements instead of building long-term capability. Retention also impacts other boardroom priorities:
- Workforce planning and skills gaps: With 55% of CHROs citing internal training as their main strategy to close skills gaps, retaining employees long enough to benefit from these investments is non-negotiable. Yet only 41% believe their training capabilities are strong (HRO Today CHRO Survey).
- Leadership pipeline risks: Just 43% of senior leaders in North America (and 53% in EMEA) feel prepared to lead in tomorrow’s workplace, exposing organizations to deeper risks if attrition accelerates.
Gen Z and Millennials: Retention Hinges on Purpose, Flexibility, & Growth
Younger workers continue to reshape retention dynamics. Gen Z and Millennials want more than pay — they seek meaningful work, flexibility, and development opportunities. According to the survey, retention strategies that fail to address these expectations risk falling flat. Hudson Talent Solutions emphasizes this point in their blog Beyond the office walls: the power of flexible work models. These generations expect more and offer more we companies deliver new work models, and better upskilling. This echoes broader global studies showing that employees who see opportunities for professional growth are far more likely to stay.
Another important way to reach these generations for career pathing is through internal upskilling and reskilling programs. These programs don’t just close critical gaps — they build loyalty. In one manufacturing study, targeted upskilling drove significant gains in job satisfaction and opened new career paths, underscoring the retention power of investment in employee development.
How Forward-Looking Companies Are Responding
Faced with economic uncertainty and shifting workforce values, forward-thinking organizations are addressing pressures:
- Doubling down on internal training: 59% of North American CHROs see internal training as critical, well above their EMEA peers at 41%. Done right, these programs close skills gaps and strengthen retention by signaling a commitment to employee growth (HRO Today).
- Building culture through leadership: Hudson Talent Solutions’s leadership development resources stress that strong managers are pivotal in retaining talent, fostering trust, and ensuring daily engagement. leadership drives day-to-day engagement; many firms are investing heavily in manager coaching to strengthen culture and trust — key drivers of loyalty.
- Prioritizing employee wellbeing: With 45% of CHROs citing mental health and stress reduction as major concerns, organizations are embedding wellness into their retention strategies, knowing that burnout directly drives attrition.
The Bottom Line: Retention Is a Leadership Strategy
In this uncertain market, holding onto your best people isn’t just HR’s problem — it’s a boardroom agenda item. Retention strategies that truly integrate career development, leadership, wellbeing, and culture are proving most resilient. Even amid a slower hiring market, the risks tied to attrition haven’t disappeared — they’ve simply evolved. Holding onto talent now demands a sharper focus on aligning development, culture, and purpose with employee expectations.
As Hudson Talent Solutions puts it, “retention today is about meeting employees where they are, understanding what motivates them, and proactively building pathways for growth and purpose.”
For CEOs and CHROs, the question isn’t if retention deserves attention, but whether current strategies are truly built to withstand economic shifts and rising workforce demands. As the data makes clear, there’s little room for standing still.
Explore more insights from the latest HRO Today Annual CHRO Survey, sponsored by Hudson Talent Solutions, here.
Or contact us to discuss how we can help you strengthen your talent strategy in this market.
