Manager quality, respect and work-life balance are the top three drivers of attrition, finds new research. Here’s what HR can do to address it.

After a few years of ‘job-hugging’, where workers have tended to remain in roles post-COVID, new data shows the tide turning in Australia’s job market.

Employees are slowly becoming less cautious and more confident about leaving current roles, and increasingly optimistic about employment prospects.

Plus, their reasons for wanting to exit roles are diverging. So what does this mean for businesses and employees alike?

As we approach 2027, the picture for hiring and employee retention is changing.

Gartner’s latest Global Talent Monitor survey recorded 26.5 per cent of Australian employees actively seeking a new role in Q2 2026, up from 19.4 per cent at the end of 2025. 

The number of Australian employees intending to stay in their current organisation also decreased to 34 per cent in 2Q26, down from 38.1 per cent in 4Q25.

“There are a few considerations for the talent strategies of HR leaders in 2027,” says Jonathan Tabah, Director at Gartner Australia. 

“We need to be prepared for some potential disruption in the labour market. We might see a spike in attrition rates and turnover rates if the economy turns around and stabilises.”

The survey of 820 Australian employees, conducted between April and June 2026, shows confidence in the overall business environment rose to its highest level in the past four years at 48.8 in 2Q26, up from 47.4 in 4Q25. 

While job confidence remains below the highs seen in 2024, employees believe they have greater choice and mobility than they did six months ago. 

Job availability confidence in Australia rose to 56.3 in 2Q26, reflecting modest recovery in labour market sentiment, after reaching a three-year low of 55.7 at the end of 2025.

“We’re realising that we need something entirely new. While we’ve been investing in leadership and manager development, we’re realising that our needs for 2027 are very different from they were in 2025. It feels like a moving target for a lot of HR leaders.”  – Jonathan Tabah, Director, Gartner Australia

Top reasons why workers stay and leave 

Gartner’s research also shows that the reasons employees leave workplaces are not the same as those that motivate them to new jobs. 

Poor manager quality (32.8 per cent of survey respondents) and lack of respect (29.5 per cent) are the top two reasons Australian employees would leave their job, according to survey findings. 

“Factors like people leaders, manager quality, respect and people management tell us a lot. People are leaving because they don’t like the way that they’re being treated, for example, or because of decisions in people leadership,” says Tabah.

While compensation remains a top driver of attraction (41.2 per cent), pay is much less important when workers decide to leave their roles (21.3 per cent). 

“Pay is always more important as an attraction driver than an attrition driver,” says Tabah. “When you’re offered a job, you know what the pay is to be offered to you. But you don’t know what your manager will be like.”

Table 1: Top 10 Drivers of Employee Attraction and Attrition, Australia, Q2 2026

Source: Gartner Global Talent Monitor

Factors such as lack of recognition (18 per cent) and a desire to pursue more innovative work (16.4 per cent) are moving up the ranks as reasons to leave. 

“Employees are feeling pushed and they’re probably working harder, but recognition by their organisations has not actually kept up with that.”

Employees seeking more innovative work (9th reason employees leave) partly relates to AI advances, says Tabah. 

For example, as soon as people understand all the things AI can do, they “expect to be able to do it tomorrow”, says Tabah. That applies to employees and CEOs equally. 

“But in reality, change happens a lot slower than that.”

Poor manager quality and lack of respect

Retention strategies tailored to a constrained labour market may not be right for a more confident one, says Tabah.

The data shows employees prefer to take jobs at workplaces which display strong people management practices (15.9 per cent) and good managers (21.8 per cent). 

“People often go to a job for the money, but they often [leave] a job because of [factors] like leadership and managers.”

Overall, confidence in leaders remains “unfortunately low” in workplaces, because work environments are changing so fast, mainly due to technological advances. 

“We’re realising that we need something entirely new. While we’ve been investing in leadership and manager development, we’re realising that our needs for 2027 are very different from they were in 2025. It feels like a moving target for a lot of HR leaders.” 

HR’s action points:

• Offer stability through upskilling

Stability ranks sixth on drivers of attraction in the survey (20.6 per cent). Tabah says separate Gartner research shows highly skilled employees are 35 per cent more likely to stay at their current employer, even when they are given a better offer. 

• Train managers to specialise in tasks AI can’t do

As AI rolls out, managers should focus more on their people leadership responsibilities, says Tabah.

“That’s how they’re going to create value through their positions. This is an opportunity for managers and leaders to invest in building those skills.”

• Reward managers for low employee turnover rates

“A manager may get an award for having teams who hit targets each quarter, but do they get recognition for maintaining a low employee turnover rate or a high staff engagement score?”

Building social identity values and recognition around being a good leader creates a tremendous amount of value for both the enterprise and employees alike, he says.

• Audit your attraction promise against your retention reality 

Compare what you promote in job ads with what leavers say in exit interviews. Identify gaps, which will show where to invest.

Organisations can check their internal engagement survey data and segment that by different variables such as employees or performance, to identify drivers of disengagement, says Tabah.

• Treat respect as an operating standard

Improve culture where possible, define expected behaviours, act quickly on disrespectful conduct and pay particular attention during restructures and change.

When hiring, consider how you can improve the candidate experience. Respect is a top attraction driver, so consider giving candidates clear timelines, honest feedback and, where possible, a chance to meet their future manager.

Motivate leaders differently

Leader and manager effectiveness and skills development have been a top priority for Chief People Officers globally for the past three years, says Tabah. 

“They’ve gotten great budgets year-over-year to invest in that.”

However, confidence in leadership still languishes.

This could signal that a new approach to manager motivation is required, highlighting intrinsic rather than extrinsic motivators, he says.

Extrinsic recognition, such as financial rewards for hitting quarterly targets and meeting budgets, may not be enough on their own.

Culture is tightly aligned with intrinsic motivation and public recognition of good leadership is important. This could look like setting up a ‘manager of the year’ award or having the CEO sending a shout-out to an effective manager during a company meeting.

“We’ve been training managers until they’re blue in the face. But very few leadership and management strategies address the motivation barriers. I think that’s something for HR leaders to consider. Ultimately, the head of HR isn’t on the hook to deliver good leadership training. They’re on the hook to deliver good leaders.”

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