Although employers are hiring more workers, employee engagement is down, according to Mercer's 2012 Attraction and Retention Survey.

In fact, more than 40 percent of respondents report that they are bringing in more employees in 2012 as opposed to 27 percent in 2010, and 16 percent of respondents are cutting staff compared to 25 percent in 2010. Still, 24 percent of respondents say they are seeing lower levels of employee engagements, a jump from 13 percent in 2010.

"Employee loyalty has been eroding the past few years due to companies' responses to the economic downturn," says Loree Griffith, principal with Mercer's rewards consulting business. "Actions like layoffs, pay freezes and limited training opportunities have created an evolving employment deal for employees due to uncertainty about what is expected and how employees will be rewarded. Meanwhile, firms are still aggressively managing people costs while finding ways to re-energize and re-motivate engaged employees."