Leveraging Purpose-Driven Work to Boost Employee Retention in 2025

Apr 01, 2025
Retaining top performers is more challenging than ever for emerging middle-market businesses. With turnover rates on the rise and employees increasingly seeking roles that align with their values, traditional retention strategies like competitive pay and benefits—while still essential—are no longer enough. A 2022 study by McKinsey found that 31% of employees who left their jobs cited a lack of meaningful work as a primary reason, a trend that’s only grown as Gen Z and Millennials, who prioritize purpose over pay, now make up the majority of the workforce. So, how can your business stand out and keep your best talent engaged for the long haul? The answer lies in leveraging purpose-driven work.
 
At Hoops, we understand that building championship teams means addressing the full talent lifecycle—from hiring to retention. In this blog, we’ll explore why purpose-driven work is a game-changer for employee retention in 2025, backed by the latest research, and share unique, strategic, and practical advice to help you create a workplace where employees feel connected to a larger mission. Let’s dive into how you can use purpose to transform your retention strategy and drive lasting success.

 

Why Purpose-Driven Work Matters for Employee Retention
 
Purpose-driven work isn’t just a buzzword—it’s a critical factor in keeping employees engaged and committed. According to a 2022 report by Benevity, employees who participate in corporate purpose programs are more likely to stay with their company, especially during their first 2.5 years—a critical window when turnover is often highest. The same report found that purpose continues to play a role in engagement even six years into an employee’s tenure, highlighting its long-term impact on retention.
 
For emerging middle-market businesses, where resources may be stretched thin, fostering a sense of purpose can be a cost-effective way to boost retention. According to Deloitte’s 2024 Gen Z and Millennial Survey, nearly nine in 10 Gen Zs (86%) and millennials (89%) say having a sense of purpose is important to their overall job satisfaction and well-being. This strong preference for meaningful work among younger generations—who make up a significant portion of today’s workforce—signals a clear message to leaders: employees want to feel their work matters, and they’re prepared to leave if it doesn’t align with their values.
 
Purpose-driven work also directly influences engagement, a key factor in retention. A 2024 Gallup survey revealed that 37% of employees who left their most recent job in the past 12 months cited a lack of engagement and poor company culture as their primary reason, outranking other factors like well-being and work-life balance (31%) and even pay and benefits at 16% (Gallup, 2024). This underscores that engagement, often fueled by a sense of purpose, is a critical driver of retention. Employees who feel connected to their organization’s mission are less likely to leave, more productive, and more likely to become advocates for your brand, making purpose a strategic lever for building a resilient workforce.

 

The Cost of Ignoring Purpose in Retention Strategies
 
Failing to prioritize purpose can be costly. The Integrated Benefits Institute reported in 2023 that the average cost of employee turnover is 1-2 times an employee’s annual salary, factoring in recruitment, hiring, and training expenses. For a middle-market company with tight margins, this can quickly add up. Moreover, high turnover erodes institutional knowledge and disrupts team morale, creating a ripple effect that impacts productivity and growth.
 
A 2022 study by MIT Sloan Management Review further underscored the stakes, finding that a toxic company culture—often marked by a lack of purpose or alignment with values—is 10 times more likely to drive employee attrition than compensation issues. For emerging middle-market businesses, where culture can be a key differentiator, neglecting purpose can lead to a revolving door of talent, making it harder to compete with larger firms that may offer higher salaries.
 
5 Strategic and Practical Ways to Leverage Purpose-Driven Work for Retention
To help your business harness the power of purpose, we’ve outlined five unique and actionable strategies that go beyond the basics. These tips are designed to resonate with your workforce, align with your company’s goals, and integrate seamlessly with tools like Hoops’ Talent Experience Platform (TXM).

1. Embed Purpose into Your Onboarding Process

The first 90 days are critical for setting the tone of an employee’s experience. A 2023 study by Paychex found that 80% of new hires who experience poor onboarding plan to leave, especially remote workers. To combat this, use onboarding to connect new hires to your company’s mission from day one.

💡 Actionable Tip: During onboarding, share stories of how your business has made a difference—whether it’s helping a client achieve a milestone or supporting a community initiative. Use Hoops’ TXM platform to automate workflows that introduce new hires to your mission, such as assigning a mentor who can share how their role contributes to the bigger picture. For example, a new sales rep could learn how their work directly impacts a client’s growth, tying their daily tasks to a larger purpose.

2. Activate Middle Managers as Purpose Champions

Middle managers are the bridge between leadership and frontline employees, making them key to embedding purpose into daily work. A 2022 Benevity report highlighted that leadership involvement and communication about purpose programs are two of the biggest predictors of employee participation and retention.

💡 Actionable Tip: Train your middle managers to champion purpose-driven initiatives. Encourage them to lead by example—whether by participating in volunteer programs, sharing how their team’s work aligns with company goals, or facilitating discussions about purpose during team meetings. With TXM, managers can use data-driven insights to identify which employees feel disconnected from the mission and tailor their approach, ensuring everyone feels included in the bigger picture.

3. Create Opportunities for Employees to Contribute to Social Impact

Employees want to feel their work has a broader impact beyond the bottom line. A 2023 Snappy study found that 76% of American workers believe retention would be higher if their company celebrated personal milestones and supported social impact initiatives.

💡 Actionable Tip: Launch a corporate purpose program that allows employees to contribute to causes they care about. For example, offer paid volunteer days or match employee donations to charities. Highlight these efforts on your website to show your commitment to social impact. Use TXM to track participation and gather feedback, ensuring your program resonates with your team and drives engagement.

4. Align Individual Roles with Organizational Purpose

Employees are more likely to stay when they see how their work contributes to the company’s mission. According to a 2024 Gallup analysis, employees who receive recognition for their contributions are 56% less likely to be looking for other job opportunities, highlighting the power of acknowledging their role in achieving the organization’s goals. 

💡 Actionable Tip: During performance reviews, help employees map their daily tasks to your company’s mission. For instance, a customer support rep might see how their quick response times help clients succeed, reinforcing their role in the bigger picture. TXM’s assistive AI can provide managers with prompts to facilitate these conversations, ensuring alignment is a consistent part of employee development.

5. Foster a Culture of Recognition Tied to Purpose

Recognition is a powerful retention tool, but it’s even more effective when tied to purpose. According to the Achievers Workforce Institute’s 2023 Engagement and Retention Report, only 21% of employees feel recognized for their contributions, revealing a significant gap that can lead to disengagement and turnover.

💡 Actionable Tip: Recognize employees for contributions that advance your company’s mission, not just for hitting sales targets. For example, celebrate an employee who mentors a new hire, helping them feel connected to the team’s purpose. Use TXM to automate recognition workflows, sending personalized messages that highlight how an employee’s actions align with your values, fostering a culture where purpose is celebrated.

 

How Hoops Can Help You Build a Purpose-Driven Retention Strategy

At Hoops, we’re committed to helping emerging middle-market businesses like yours turn your workforce into a strategic advantage. Our Talent Experience Platform (TXM) is designed to support every stage of the talent lifecycle, including retention. With TXM, you can:

  • Automate Purpose-Driven Onboarding: Streamline onboarding workflows to connect new hires with your mission from day one.
  • Gain Insights into Engagement: Use data-driven insights to identify employees who feel disconnected and take action to re-engage them.
  • Facilitate Meaningful Recognition: Automate recognition programs that celebrate purpose-driven contributions, boosting morale and retention.
Ready to see how TXM can transform your retention strategy? Visit hoopshr.com to learn more about our platform and how we can help you build a workplace where employees thrive.

The Future of Retention: Purpose as a Competitive Advantage

As we move further into 2025, purpose-driven work will become a non-negotiable for retaining top talent. Emerging middle-market businesses that prioritize purpose will not only reduce turnover but also attract the next generation of workers who value meaning over money. By embedding purpose into your culture, onboarding, and daily operations, you can create a workplace where employees feel valued, engaged, and committed to your mission.

Don’t let a lack of purpose drive your best talent away. Start implementing these strategies today, and partner with Hoops to build a retention strategy that works. Visit hoopshr.com to explore our full suite of talent solutions and take the first step toward a more engaged, purpose-driven workforce.

Simplify talent strategy. Amplify growth. Visit hoopshr.com or call 877-262-7358 to get started!

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Picture of Nicole Houston

Nicole Houston

With over 10 years of experience in recruiting and HR, Nicole Houston has been a pivotal part of Hoops HR since 2018. She has successfully worked with clients across diverse industries, helping businesses build high-performing teams. Nicole’s deep expertise in talent acquisition and HR strategy continues to drive results for clients.

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