- Companies that invested in talent in 2020 (in addition to cutting Q1 costs) bounced back with an average Q4 revenue increase of 8.2%, a Gartner study found. The July report is the result of Gartner's HR Practice research team reviewing earning calls transcripts from S&P 500 companies.
- The 8.2% uptick for these companies translated to more than a $500 million increase in revenue.
- Additionally, Gartner found that 48% of S&P 500 companies funded at least one talent investment opportunity through 2020, with an emphasis on employee benefits and well-being.
"The balance between cost savings and bold talent investment opportunities is vital for protecting an organization’s continued growth capabilities," Seyda Berger-Böcker, director analyst in the Gartner HR practice, said in a press release.
John Anderson, a managing director for Allegis Partners’ HR practice, has observed renewed gusto for talent, particularly in the executive search lane. "We have made more placements in the first six months of 2021 than we did all of last year," Anderson said in an email, adding that search velocity picked up at the end of 2020.
"We are seeing clients make decisions much quicker than they have in the past," Anderson said, echoing Berger-Böcker’s sentiment. "The economy is robust: there are a lot of emerging businesses, lots of venture capitalist and private equity money, and innovation. All of these factors drive the need for talent."
The employee well-being data from the 2021 report is noteworthy: Gartner’s report found that "employee benefits" were mentioned about five times more frequently in 2020 than in pre-pandemic earnings calls. Similarly, "employee well-being" was mentioned six times more frequently.
"As companies continue to work through the lingering effects of the pandemic, organizations must recognize supporting employee well-being is not just the right thing to do, but it’s also good for the overall business," Matthias Graf, a Gartner HR senior director analyst, said in the press release. Baking talent into strategic business priorities is "paramount," Anderson said, adding that investing in current employees "is at the core."
"This drives productivity, satisfaction and loyalty, without large recruitment investment costs," he continued. As outlined in Support for Well-Being in 2021 and Beyond, Gartner’s HR practice previously found that "holistic well-being support" can improve discretionary effort by 21% — twice as much, data shows, as companies offering solely physical and financial programs.
Still, for HR teams interested in bringing in fresh talent, good news: A study by networking platform Tallo suggests that easily accessible employee mental health resources are a draw for Gen Z talent. About 20% of respondents told Tallo they decided not to apply for a job because the employer lacked resources for neurodivergent employees. Likewise, 80% of respondents said they’d be more likely to apply to a company who had materials for employees identifying as neurodivergent.
Considering this insight, along with Gartner’s, investing in talent may be a boon to business.