St George Illawarra coach Paul McGregor will take a step away from recruitment and retention next year after admitting instability around player contracts was a huge factor in the Dragons' disappointing 2016 season.

The Dragons dropped seven of their last nine games to limp to an 11th place finish amid uncertainty around the future of off-contract stars Benji Marshall and Mitch Rein, with both ultimately moving on at season's end.

Off-contract: Josh Dugan. Credit:Getty Images

With almost half the Dragons playing group off-contract in 2017 – including the likes of Josh Dugan, Gareth Widdop, Jack de Belin and Euan Aitken – McGregor said he won't let contract talks derail the club's fortunes again in 2017.

"I've been involved [in recruitment] the last two seasons but, after reviewing 2016, [stepping back] was something that needed to happen," McGregor said. "There was a lot of external pressure applied, and that's something I can't control, but there were times where I let it control me a little bit.