Latest / Hiring & Firing with Fexingo: Recruitment, Performance, and Workforce Decisions / Why Quiet Hiring Is Your Best Retention Strategy
Transcript
- Lucas: There is a concept in hiring right now that everyone talks about but almost nobody executes well — quiet hiring. And I actually think it is the most underrated retention lever you have. Luna: Quiet hiring — you mean the opposite of quiet quitting, right? Where instead of employees doing the bare minimum, companies find hidden talent inside their own walls? Lucas: Exactly. And the data is pretty striking. LinkedIn's 2024 Global Talent Trends report found that companies with strong internal mobility retain employees for nearly two years longer on average — that's a 40 percent improvement in retention. But most companies still default to posting a job description and hoping a unicorn applies. Luna: So why is it that internal mobility is so effective? I mean, it makes sense intuitively — people want to grow — but what's the actual mechanism? Lucas: I think it comes down to three things. First, you already know the person's work style, values, and reliability — you're not taking a gamble. Second, the employee already knows the company's culture and politics, so they can hit the ground running. And third, and maybe most importantly, it signals to everyone else that there is a path forward here. When you see a colleague get a stretch assignment or a promotion, you think, 'That could be me.' Luna: Right, but there is a flip side. I've seen quiet hiring backfire. A friend worked at a midsize tech company where they asked their lead engineer to also run the new data team as a 'growth opportunity.' No extra pay, no reduced existing workload. She burned out in three months and quit. Lucas: That is the classic failure mode. Quiet hiring doesn't mean just piling more work on your best people. The whole point is that you are reallocating or adding resources intentionally. You're essentially creating internal gigs — temporary, project-based roles that have clear boundaries and compensation. Luna: Can you give me an example of a company that does this well? Lucas: Procter & Gamble has a formal 'internal gig' platform. Employees can browse short-term projects in other departments — marketing, supply chain, finance — and apply for them on top of their current role. The projects come with a budget and a timeline, and managers are required to approve a certain number of hours per week for gig work. It's structured so you don't burn out. Luna: So it's not just 'hey, do more work.' It's 'here is a real assignment with a beginning, middle, and end, and we've accounted for your time.' That is very different from what my friend experienced. Lucas: Exactly. And the return on investment is huge. P&G reported that employees who participated in internal gigs had a 50 percent higher retention rate over two years compared to those who didn't. Plus, they filled 30 percent of open roles internally without ever posting externally. Luna: Those numbers are hard to argue with. But I imagine some managers push back because they don't want to lose their best people to other teams. How do you handle that? Lucas: That is the single biggest barrier. And honestly, it's a short-sighted view. If you block someone from growing, they will leave the company entirely. But if you let them take a six-month project in another department, they might come back with new skills, or they might stay with the company in a new role. You keep the talent in the building. Luna: So you're saying the manager's job shifts from 'retain this person on my team' to 'retain this person in the company.' Lucas: That's the mental model. And smart companies tie manager incentives to overall retention, not just team retention. If a manager develops and places talent elsewhere in the organization, they get recognized for it. Luna: Let's talk about when quiet hiring is not the right answer. Because it can't be the only tool in the box. Lucas: Sure. Quiet hiring works best when you need a specific skill that exists somewhere in your organization, even if it's not in the department that needs it. But if you are entering a brand new market or building a capability you've never had — say a biotech company trying to build an AI lab — you probably need external expertise to bring in that knowledge. Luna: So the framework is: first look inside, but don't force it if the skill doesn't exist. Lucas: Yes. And even when you do hire externally, quiet hiring can complement that. You can pair an external hire with an internal 'buddy' who already knows the company — that's a form of quiet hiring too, because you're giving the internal employee a mentoring role that builds their leadership skills. Luna: I want to get practical. If a manager is listening right now and wants to try quiet hiring next week, what should they do? Lucas: Three steps. Step one: identify one person on your team who has shown curiosity or aptitude for something beyond their current role. It could be the analyst who always asks good questions about strategy, or the engineer who helps with design reviews. Step two: find one project — not a full-time role — that matches that stretch area. Something with a clear outcome and a deadline. Step three: sit down with that person and say, 'I have this project. I think you'd be great at it. It would take about five hours a week for the next two months. Are you interested?' Luna: And if they say yes, what about compensation? Do you adjust pay? Lucas: That's a great question. For a short-term gig, you don't necessarily need to adjust base salary. But you should acknowledge the additional contribution. It could be a one-time bonus, a training budget, or even just public recognition. The key is that it doesn't feel like exploitation. Luna: I've also seen companies use quiet hiring as a retention tool when someone has one foot out the door. They offer a project as a way to re-engage them. Lucas: That can work, but it's risky. If the person is already disengaged, a new project might feel like more work. Better to have a honest conversation first: 'What would make you want to stay?' If the answer is 'I want to do something different,' then quiet hiring is a perfect fit. Luna: So the real skill here is not just assigning projects — it's having the conversation. Knowing what your people actually want. Lucas: Absolutely. And that takes time. But if you're not having those career conversations regularly, you are flying blind. Quiet hiring is just the mechanism. The foundation is knowing your team. Luna: I want to talk about measurement. How do you know if quiet hiring is actually working? Lucas: Two metrics. First, retention of the employees who participated in internal gigs versus those who didn't. Second, time to fill for roles that were filled internally versus externally. If you see that internal roles are filled faster and those employees stay longer, you know it's working. Luna: And what about the quality of work? Do internal hires perform better than external? Lucas: On average, yes. A study from the Society for Human Resource Management found that internal hires have a 20 percent higher performance rating in their first year compared to external hires. Part of that is the cultural knowledge, part is the organizational trust that's already built. Luna: But again, external hires can bring fresh perspectives. So quiet hiring shouldn't replace external hiring entirely. Lucas: No, it's about balance. The best talent strategies I've seen use a mix: about 60 percent internal mobility, 40 percent external hiring. That way you get the stability of internal talent and the injection of new ideas from outside. Luna: It's fascinating how quiet hiring touches on so many other aspects of HR — retention, engagement, career development, even compensation. Lucas: It really is a lever that, when pulled correctly, strengthens the whole system. And it's one of those rare things that's good for the employee, good for the manager, and good for the bottom line. Luna: And if these conversations have moved your work forward in some small way, we do keep this podcast ad-free thanks to listeners like you who support us. Lucas: Yeah, it's a small way to help us keep digging into topics like this — internal mobility, retention strategy, all of it. If you've gotten value, you can find us at buy me a coffee dot com slash fexingo. Luna: And we really appreciate that. Now, back to quiet hiring — one last thought: what is the single biggest mistake companies make when trying to implement this? Lucas: They try to scale it before they have the culture for it. You can't just launch an internal gig platform and expect people to use it if managers hoard talent and there's no recognition for developing people. Start small. Prove it works on one team. Then expand. Luna: Start small, measure, and build trust. That sounds like a pretty solid plan. Lucas: It is. And the beauty is, you already have the talent — you just have to give it room to move.