In today’s workplace, the pressure to attract and retain top talent is more intense than ever. Organizations are navigating a landscape shaped by shifting employee expectations, evolving skill demands and a growing disconnect between leadership perception and employee reality.
Yet many companies are still relying on outdated playbooks, investing heavily in recruitment strategies, compensation packages and workplace perks. Unknowingly, they are overlooking the deeper drivers of long-term engagement.
This is one of many critical insights from the first global report in Right Management’s 2025 The State of Careers series: “The Career Equation: What Attracts Talent Isn’t What Keeps Them.”
As a global talent development leader for over 45 years, Right Management partnered with Reputation Leaders to conduct independently commissioned, proprietary research across eight countries and four major regions, including North America, Latin America, Europe and Asia-Pacific. The study gathered insights from 2,402 white-collar employees and 1,029 business leaders, revealing a critical misalignment in how engagement is understood and acted upon. This, in turn, necessitates new engagement strategies across North America and the world.
One of the most striking findings from the report is what Right Management calls the Engagement Illusion: a significant gap between how leaders perceive employee engagement and how employees actually feel.
This illusion isn’t just a matter of differing opinions. It’s a strategic blind spot that leads organizations to prioritize the wrong initiatives, invest in ineffective solutions and ultimately lose the very talent they worked so hard to attract.
The consequences are real. According to Gallup, only 31% of U.S. employees are engaged — the lowest level in over a decade — costing companies billions in lost productivity. This external data reinforces the urgency of the issue: engagement is not just a soft metric; it’s a business-critical one.
So where does the disconnect begin? Often, it starts with a fundamental misunderstanding: what attracts talent is not what keeps them. This is what we call the Talent Paradox.
When considering new job opportunities, employees prioritize pay and benefits (36%) and job logistics (19%). These are tangible, immediate incentives that help lure candidates in. But once inside the organization, these factors play a much smaller role in long-term engagement.
Instead, employees stay when they feel aligned with leadership and the culture, see a future for themselves and have opportunities to grow. The report shows that fit and career development are far more influential in driving engagement than compensation or perks.
Yet many leaders continue to rely on attraction levers — competitive salaries, flashy benefits and brand reputation — assuming they’ll translate into retention. This flawed assumption leads to short-term wins but long-term losses.
To build a truly engaged workforce, organizations must understand the deeper, more intrinsic drivers of employee engagement. The report identifies two key factors:
Meanwhile, leaders overemphasize compensation (21%) and job logistics (17%), which have far less impact on actual engagement.
This misalignment means organizations are investing in the wrong areas, focusing on what looks good on paper rather than what truly motivates people to stay and contribute.
While the Engagement Illusion is global, its manifestations vary by region. Understanding these nuances is essential for multinational companies, needing to tailor their talent strategies across continents.
Despite these differences, one theme remains consistent: employees want to feel connected to their organization’s purpose and confident in their ability to grow within it.
When leaders focus on the wrong engagement and retention levers, they risk:
This isn’t just a retention issue — it’s a business continuity challenge. Organizations that fail to address the Engagement Illusion are making decisions based on flawed assumptions, undermining their ability to evolve and compete.
The good news? These challenges are far from unfixable. The report offers a clear path forward for organizations willing to listen, learn, and lead differently.
To close the gap between perception and reality, leaders must:
These strategies aren’t just about improving engagement and retention — they’re about building a resilient, adaptable workforce that’s ready for the future.
As the “The Career Equation” makes clear, engagement isn’t a one-time fix or a line item in a budget. It’s a continuous journey rooted in connection, purpose and growth. Leaders who embrace this reality will build more loyal, productive teams and position their organizations for long-term success.
The Engagement Illusion is a turning point. New engagement strategies are essential to meet the needs of today’s evolving workforce. By shifting from assumptions to understanding, organizations can move from insight to impact — and from retention risk to workforce resilience.