As they wait for the economy to improve, business leaders are setting their priorities. The first thing many plan to do on that inevitable day when budgets open up again is hire more employees.

Asked to pick from a list of employee-related priorities, 31 percent of 150 senior executives told staffing firm Robert Half that new hiring is the area in which they're most likely to increase spending once they actually have money to spend. That's not surprising, considering that waves of layoffs have left many, if not most, U.S. companies operating with lean staffs. With a national unemployment rate of about 10 percent, there are more than enough bodies out there to fill those empty seats.

But what about those employees companies already have? You know, those staffers who have trudged through the recession like pack mules hauling an ever-growing load. The rest of the options Robert Half presented to the executives (who all work for companies among the 1,000 largest in the U.S.) were related to the staff they already have. Twenty-one percent picked salary increases as their top spending priority; 15 percent said increasing or reinstating bonuses; 9 percent said investing in employee training; and 5 percent opted for enhancing benefits.

If they're hoping to actually retain their staff, organizations may want to look for ways to reward existing employees before splurging on new ones. Building for the future will obviously mean bolstering your teams with new blood, but if companies aren't careful, they'll also be looking for replacements for their best employees.

Consulting firm Watson Wyatt and HR non-profit WorldatWork last week released their annual U.S. Strategic Rewards survey, and the results don't bode well for employee retention.  Employee engagement levels fell 9 percent from last year's survey; for "top performers," the decrease was about 25 percent. Among those top performers, there was a 26 percent dip from last year in satisfaction with opportunities for advancement -- and a 14 percent increase in employees ready to look for greener pastures.

Not surprisingly, 41 percent of the 1,300 employees surveyed by Watson Wyatt and WorldatWork said that the pay and benefit changes their company has made in the past year have had a negative effect on work quality and customer service. And 43 percent of top performers said that over the last year the expectations placed on their performance has increased.

"The fallout from the actions employers have taken in response to the recession is now coming to light, and it is significant," said Laura Sejen , Watson Wyatt's global director of strategic rewards. 

To start new growth initiatives and pick up projects that have been put on hold, companies are going to have to add some staff, there's no question. But they will also have to do something to appease employees who are planning to run for the door at the job market's first sign of life.

Convincing those employees to stay may require a little creativity. "If financial incentives are not an option, firms should look for other ways to recognize staff, such as providing flexible work schedules or granting additional vacation days," said Max Messmer, chairman and CEO of Robert Half, in a statement.