Some 324 out of the 700 organisations surveyed worldwide last September said that difficulties in finding and keeping talent were most likely to jeopardise development, with many also citing problems around replacing key employees when they leave.
Within Europe, a third of respondents said they would begin – or continue – redundancies this year, with three out of five expecting greater restrictions on staff travel and two in five planning tighter bonus criteria or 'restructured' career ladders.
Many expressed their belief in a link between a 'high-performance culture' and growth and the role that effective performance management plays in helping shape such a culture.
A lack of employee engagement also surfaced as a key concern for employers, with 39% worldwide citing it as among their top three concerns.
Towers Watson’s senior consultant on talent and rewards, Joris Wonders, said: "Despite respondents’ cautious optimism about growth in the coming year, they recognise that an inability to attract new talent or hold on to key individuals could prove to be the difference between growing and remaining stagnant.
"In light of this concern, it is striking that the research found that many respondents aren’t truly prepared to address talent issues," he said.