Fewer than 1 in 4 employees are engaged at work. More than half are open to changing jobs.
But all is not lost for companies worried about losing talent.
Gallup’s annual State of the Global Workplace survey suggests that the impact of employee engagement on employee retention may be underappreciated, presenting an opportunity for determined leaders.
Even in an employment environment in which more than half of employees surveyed are at least on the lookout for new job opportunities, engaged employees are significantly less likely than actively disengaged employees to be window shopping.
And with the majority of employees in a category between engaged and actively disengaged, there’s reason to believe that companies can create a culture that demonstrably improves engagement and, as a result, retention.
“Looking at the big picture, low-engagement workers represent an immense opportunity for economic growth,” Gallup wrote in the report’s executive summary, which estimated that low engagement cost the global economy $8.8 trillion in 2022 — about 9% of global GDP. “Leadership and management directly influence workplace engagement, and there is much that organisations can do to help their employees thrive at work.”
Gallup polled more than 122,000 employees worldwide between April 2022 and May 2023, finding that 51% were “watching for or actively seeking a new job.” But while 61% of actively disengaged employees were open to the possibility of a job change, just 43% of engaged employees were.
The annual Gallup poll labels survey respondents as either engaged, not engaged, or actively disengaged using a scale based on responses to 12 statements, such as “The mission or purpose of my company makes me feel my job is important” and “This last year, I have had opportunities at work to learn and grow.”
The latest survey labelled 23% of the world’s workforce as engaged, which actually was a record high since the survey debuted in 2009. Eighteen per cent were actively disengaged, partially defined as employees who “take actions that directly harm the organisation”.
While that adds up to a roughly 1-to-1 ratio of engaged to actively disengaged employees, the latest Gallup Exceptional Workplace Award featured companies that on average had an 18-to-1 ratio in favour of engaged employees.
That’s where the largest group in the survey, those defined as not engaged (59%), can play a pivotal role in employers’ efforts to retain talent. The survey report offers some advice on how to turn that “low-hanging fruit” into employees that are engaged and therefore are more likely to remain with the company:
Recognise the potential impact of engagement. Among not-engaged employees, a survey-high 41% mentioned an engagement or culture-related change when asked for one change that would make their workplace better. And while many companies are pouring resources into managing the impact of work location (remote vs. on-site vs. hybrid), the survey found that when it comes to stress in the workplace, employees’ level of engagement is 3.8 times more impactful than work location.
Focus on engaging managers first. Thirty-one per cent of managers surveyed were labelled as engaged. While that’s higher than the 20% of individual contributors who were engaged, that still means that the large majority of managers weren’t engaged. Why does that matter? Because the survey found that 70% of team engagement is attributable to the manager.
Seek ‘true engagement’ for your employees. Factors such as reduced stress level and increased pay are important to employees, but general satisfaction doesn’t have the same impact as engagement, which leads to employees reaching their potential and choosing to stay put as a result.
“True engagement means your people are psychologically present to do their work,” the report said. “They understand what to do; they have what they need; and they have a supportive manager and a supportive team. They know why their work matters. They are work ready.”
— To comment on this article or to suggest an idea for another article, contact Bryan Strickland at Bryan.Strickland@aicpa-cima.com.