The Employee Retention Index from Eagle Hill Consulting rose 3.9 points to 102.5 in Q1 2025, indicating that employees are more likely to stay in their current positions over the next six months.
Key retention indicators
Despite this recent uptick, the index remains below its Q2 2024 peak, continuing a broader downward trend. Employee perception of external job opportunities has declined significantly, with the Job Market Opportunity Indicator dropping 2.4 points to 99.6.
Meanwhile, internal factors driving retention have improved:
- Compensation Indicator: +3.3 points (largest increase)
- Organizational Confidence: +2.7 points
- Culture Indicator: +2.6 points
Demographic variations
The most notable retention patterns by demographic include:
- Gen Z workers show remarkable loyalty with a record-high retention index of 112 (up 17.2 points), making them the generation most likely to remain in their positions.
- Millennials present the greatest retention risk with an index of 99.9 (down 8.8 points).
- Gender gap has widened to 19 points (women: 92.9, men: 111.9).
- The compensation perception gap between genders has reached 33.2 points.
Market implications
These trends align with Bureau of Labor Statistics data showing the U.S. employee quit rate rose to 2% in January and February, up from 1.9% in December. This suggests that while employees have become more hesitant about job opportunities, they may still be seeking changes in the first half of 2025.
This presents an opportunity to focus on Gen Z recruitment while developing targeted retention strategies for Millennials and women, who appear most dissatisfied with their current employment situations.
