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For years, HR leaders have celebrated low turnover. A stable workforce has been viewed as a sign of health. But that logic is breaking down.
Economic uncertainty, accelerated by AI adoption and geopolitical shocks, has fundamentally altered employee behaviour. Workers across all generations are prioritising job security over progression. They are staying – not because they are engaged, but because the perceived risk of leaving outweighs the reward.
The result is the stability paradox. Retention rises, but discretionary effort falls. The workforce looks healthy on paper, but beneath the surface, it is standing still.
The rise of 'job hugging'
Adrian Seligman
Chief Executive Officer, Top Employers Institute
The stereotype of Gen Z as restless job-hoppers has been overturned. Adrian Seligman, Chief Executive Officer at Top Employers Institute says, "Uncertainty has become a defining feature of the business landscape in recent years, as AI, trade policy shocks and geopolitical tensions continue to reshape the world of work. This precarious economic outlook paired with a tightening job market, is heightening employee desire for job security.”
Adding, “Due to this, a paradoxical outcome is occurring – higher staff retention paired with reduced employee engagement over time. Indeed, while Gen Z is often labelled the 'job-hopping generation', the latest research suggests they are aspiring for stability and instead prioritising job security over ambition or career growth. This contrasting trend has been defined as 'job hugging' and evidence indicates that it is here to stay, with 86% of workers across all generations admitting to job hugging at least once in their career - 65% expect the trend to become even more prominent in 2026."
Eighty-six per cent shows this is not a youth phenomenon.
Uncertainty has become a defining feature of the business landscape in recent years, as AI, trade policy shocks and geopolitical tensions continue to reshape the world of work. This precarious economic outlook paired with a tightening job market, is heightening employee desire for job security
Why retention is a lagging indicator
Richard Hunt
Director, Liquidation Centre
The danger is that HR teams mistake stillness for loyalty. Richard Hunt, Director at the Liquidation Centre says, "Periods of economic uncertainty tend to make employees more cautious in their career decisions, not because they lack ambition, but because the risk of change feels greater than the reward. In our work with businesses navigating financial pressure and restructuring, this shift in behaviour is becoming increasingly visible.”
He adds, “For HR leaders, this means traditional metrics like retention or turnover no longer tell the full story. A stable workforce is not always an engaged or high-performing one. Instead, organisations should focus more on behavioural signals of engagement, such as participation in learning opportunities, willingness to take on stretch roles, and cross-functional collaboration.” Supporting this requires a more intentional approach to workforce design. “This means creating clearer internal pathways, making it easier for people to move between roles, and ensuring career development is visible and consistently supported across the organisation."
If you only measure whether someone stays, you learn nothing about whether they contribute. A workforce that never leaves but never learns is not stable. It is in many ways fossilised.
For HR leaders, this means traditional metrics like retention or turnover no longer tell the full story. A stable workforce is not always an engaged or high-performing one. Instead, organisations should focus more on behavioural signals of engagement, such as participation in learning opportunities, willingness to take on stretch roles, and cross-functional collaboration
The real cost of disengagement
Gill Phillips
HR Consultant, Job Matters Consulting
What are the financial consequences? Gill Phillips, HR Consultant at Job Matters Consulting says, "Adrian Seligman reports that 86% of all workers across all generations are 'admitting to job hugging at least once in their career' whilst 'employees who use security as their main reason for staying in a role may no longer be motivated by the work itself. This results in a stable, yet disengaged workforce'. This seems like a problem across all ages as this lack of 'discretionary effort' is a real problem for productivity: the Gallup organisation has calculated that disengaged employees cost the global economy a massive $8.8 billion!"
Phillips has seen this play out operationally. "A few years back I worked for a global engineering organisation with a reputation for being THE place to work if you possessed a set of specific engineering skills. The age demographic was heavily skewed towards the 45 – 60 bracket, the engineers there 'hugging' their roles tightly whilst stacking up the years until retirement, pension or ill health retirement arrived, knowing they were unlikely to get the same pay and benefits anywhere else. Whilst it was a market leader, the firm experienced heavy competition globally and had already closed one factory and bought out a major rival.
Job hugging in current times really is a problem for any organisation and it's good to see that more recent clients are keen to upskill their staff with both supporting AI technology and the non-technical skills and behaviours necessary to cope with increasing change and the shifting performance demands this places on them
“On the bottom line margins on manufacturing remained too low with a UK base, and profit on maintenance was under pressure from small, local providers – we needed to operate more productively across all grades. Our HR team recognised this was a ticking workforce timebomb and we knew that longevity of service often over-rode any appetite for change across the engineering front line."
Long service correlates with resistance to change. In a competitive environment, that resistance becomes a liability.
