According to a recent Gartner survey, Australian employees’ perceptions of their organisation’s workplace culture have dropped to their lowest point in three years. In the fourth quarter of 2024, only 26.2% of employees viewed their workplace culture positively. Moreover, confidence in organisational agility and innovation hit record lows, with just 11.9% of employees seeing their workplace as adaptable and 16.3% viewing it as innovative.
The survey highlights an urgent need for Australian organisations to rebuild workplace confidence in 2025. Without intervention, businesses risk further declines in employee engagement and productivity. The report also highlighted a significant drop in the percentage of highly engaged employees, falling to 19.6% in Q4 2024—down 10% from early 2022.
“Delivering a great employee experience is increasingly difficult for Australian organizations due to weakened company culture, employee fatigue leading to disengagement, and shifting flexible work expectations. To turn this around, employers must focus on fulfilling employee value proposition (EVP) promises; building a culture that engages and retains employees; and driving talent and business outcomes,” said Neal Woolrich, director, advisory in the Gartner HR practice.
Investing in key talent groups
One of the more positive insights was the rise in high-potential employees with the ability and ambition to take on leadership roles. This group grew to 6.5% of the workforce in Q4 2024, nearly doubling over the past year. Woolrich emphasised the importance of nurturing these individuals, as they excel at networking, problem-solving, and shaping company culture.
Lack of leadership quality
In addition, the report found that fewer Australian employees planned to stay with their current employer, with retention dropping from 35.4% in Q3 2024 to 33.7% in Q4. Leadership quality emerged as a crucial factor in employees’ decisions to leave, ranking among the top three reasons for attrition for the second consecutive quarter.
As companies face declining workplace culture and engagement challenges, prioritising strong leadership, employee development, and a supportive work environment will be essential for long-term success.