According to a recent PE-CXO survey, 83% of executives are feeling the impact of increased pressure to provide competitive compensation to attract and retain talent on constrained budgets, and 34% selected employee compensation as the greatest threat to budgeting this year. Leaders are under pressure to allocate significant resources to compensation to avoid turnover while also trying to control their budgets.
Interestingly, a competitive talent market has remained in the face of an economic downturn. High interest rates, inflation, supply chain issues, and overall market uncertainty, coupled with long-term increased labor costs are likely to pose persistent challenges to talent acquisition and retention strategies even as economic conditions change.
“The continued focus on people is reflected in budget planning, as indicated by both finance and HR leaders. In December, 49% of CFOs and finance leaders said they expected to increase spending on HR in 2023, while only 25% expected to decrease it.”
— Gartner report
Why Talent is a Strategic Value Creation Lever
77% of talent leaders say their talent acquisition strategies are more about total value creation for the company than about achieving cost savings, jumping 32 points in 2023 from just 45% the previous year. 80% of leaders say the goal of their company’s talent strategy is to have a measurable impact on business performance.
— Randstad Enterprise’s