41 Stats on the Importance of Employee Engagement

June 20, 2019
Updated: August 16, 2019
Written by Bailey Reiners

Sure, you may be able to hire exceptional employees, but can you keep them engaged with their work month after month, year after year? There are countless factors that contribute to an employee’s engagement with their work, and those factors vary by individual. Unfortunately, many employees who become disengaged at work will leave for better, more interesting opportunities. Worse than that, disengaged employees may stay at your company, becoming real life Peter Gibbons’ from Office Space.

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In order to build a prosperous work environment and company, you need to prioritize your employees and how they engage with their work. Doing so will benefit both your employees and business in more ways than one. We’re going to delve into the importance of employee engagement with some cold hard facts.

 

Employee Engagement Overview

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Less than 25% of U.S. employees are engaged with their work

Who’s engaged at work? Well, just about no one. As of 2018, less than one quarter of the workforce identifies as feeling engaged with their work. If you do a little math, that means there are roughly 120 million unengaged employees in the United States workforce. That’s pretty grim. 

Even worse, 85% of GLOBAL employees worldwide are not engaged at work

Employers seriously need to get to work if they want to make a dent in the 85% of the world’s employment population that is not engaged at work. If we continue to ignore employees not engaged with their work, they may disengage completely.

Worst of all, 17% of employees are straight up disengaged at work 

Instead of leaving their job for something more enticing, 17% of employees stay at their jobs and continue to do minimal work for the same paycheck, even though they're actively disengaged. How much could disengagement really be costing the workforce, you might ask?

Disengaged employees cost us half a TRILLION dollars Every year

This is no joke. Employees who are disengaged and continue to work at their company cost between $450 and $550 billion in lost productivity annually. Imagine how much growth the economy would see if only companies kept their employees engaged and satisfied in their jobs. 

Unfortunately those disengaged employees aren’t going anywhere.

With so many disengaged employees, you’d think people would be dusting off their resumes and looking for a new gig, but as it turns out, most of them plan to stay put. 65% of all employees, including all those disengaged folks, have no current plans to change jobs.  

You can engage employees before they even start on the job

19% of employees said joining an employee communications app before their first day helped them feel connected with the company’s culture immediately. Allowing new hires to join communications apps, like Slack, provides them with the opportunity to get to know their team, what they're working on and how people communicate in general. 

When the onboarding process is great, so is EMPLOYEE engagement

53% of HR professionals note that when onboarding processes improve, so too does employee engagement. Improving the employee onboarding process is a task unto itself, but the work will pay dividends in myriad ways, so don't skip it.

Why then are nearly a third of employers not catching on?

Even though the effects of having a positive onboarding process are significant, only 31% of employers find their recruitment process to be very satisfactory. Seriously, just ask your employees for feedback and implement change. 

It’s not just the onboarding process, it’s the company’s culture

Culture, whether good or bad, is apparent to even the newest hires. 32% of employees leave their current job within 90 days of starting because of the culture.

Great company culture only boosts employee engagement 

When looking at the job market as a whole, 77% of employees state that working among a strong company culture helps them do their best work. And when employees do their best work, they remain actively engaged It's win-win.

Bad managers have a lot to do with employe engagement

Direct managers have a significant amount of influence on an employee's growth and career path, which is why 68% of employees who don't feel supported by senior leaders consider quitting in order to find a mentor who will support them. If your employee engagement levels are low, start by touching base with your managers.  

fortunately, so do good managers 

Just as a bad manager can cause employee engagement to nosedive, a good manager can cause it to skyrocket. 67% of employees report heightened engagement when they feel they have the right manager in place, a little leadership goes a long way. 

only a small minority of employees see leadership as committed to culture

While employees believe managers play a key role in building company culture, only 9% view leadership as a whole as being committed to improving company culture.

Most men and half of women do feel supported by management 

Among a list of gender differences in the workplace, 70% of men and 55% of women feel supported by their managers in their career goals. Companies need to identify pain points between managers and direct reports in order to help employees feel supported and engage in their roles.

Is a simple ‘thank you’ really all it takes?

Companies that have value-based recognition strategies notice a 90% positive impact on employee engagement. There are a variety of ways to recognize employees, and there’s no wrong way to do it. However, people may prefer different methods — such as public or private recognition — so just ask. 

It May Be Simple, but it It's Not Standard

Even though recognizing employees for their hard work and achievements is a simple gesture of appreciation, only 23% of employers have recognition programs in place. 

 

 

Employee Engagement and productivity

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Higher employee engagement = higher productivity

Companies that take care of their employees and ensure they are constantly engaged and satisfied in their work reap the benefits of a 17% increase in productivity

Higher productivity = high profitability

And when employees are more productive, it’s a no brainer that they are earning the company more money. Companies with highly engaged employees see a 21% increase in profits

Engaging employees can be as simple as providing clear instructions

One of the easiest things a manager can do to set employees up for success is simply making sure they understand their role. Two-thirds of employees are 33% less productive simply because they aren’t sure what they should be doing in their role. 

Errors are significantly more common among disengaged employees

A recent study found that disengaged employees make 60% more general errors than engaged employees. While mistakes aren't the end of the world, all those avoidable errors add up over time.   

For high performers, recognition is even more important

72% of respondents in a study noticed a significant improvement in employee engagement among high performers that are recognized for their work. Which of course begs the question, if your employees are exceptional performers, why wouldn’t you recognize them?

incentives goes a long way 

When employees have little to no incentive to perform well, they probably won’t. Around 70% of employees feel disengaged at work because their companies don’t offer adequate incentives. 

Engaged employees are less likely to play hooky 

When employees are highly engaged, they tend to have 3.5 fewer absentee days each year compared with employees who are not engaged in their work. Think about it: if you’re unhappy and not engaged at work, you can probably think of better ways to spend your day than at a job you don’t enjoy.

Then again, maybe it’s better for those bad eggs to stay home

Even one or two underperforming employees can have a negative impact on the success of an entire team. It’s best to identify these under-performers and check in to see how you can help them better engage in their work, or find another job so they aren’t weighing down your other team members. It’s better for the business and the individual.

 

 

employee Engagement and Profitability

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How would you like to see a 21% increase in profits

Companies that prioritize employee engagement are rewarded with a 21% increase in profitability. Instead of spending your time and money in other areas of your business, you should always prioritize your employees. When you prioritize them, they’ll return the favor. 

shareholder returns Also rise alongside employee engagement

In addition to elevated profits, highly engaged companies see a 9% increase in shareholder returns each year. When employees are happy and engaged, so are employers, shareholders and stakeholders. 

Top performers yield $5,000 more in profits each year 

A single employee in the top 1% of productivity creates an additional $5,000 each year for the company. If only all of your employees could be top performers...oh wait, they could be!

Toxic employees cost their company up to $12,000 in profits each year

If you weren’t impressed by how much top performers can add to your bottom line, maybe the fact that disengaged employees can cost you up to $12,000 each year will kick your employee engagement plan into action. 

Diversity and inclusion are ALSO essential to employee engagement

A Gallup study found that companies with high gender diversity and employee engagement saw a 46%-58% increase in financial performance. 

Even customers notice an astronomical difference when employees are engaged

Believe it or not, customers are 233% more loyal to companies with engaged employees. Relationships are critical for the success of any business, and if your employees are engaged in their work, your customers will notice. 

Companies can actually save money by engaging their employees

Employees care so much about working for a company they feel engaged with that they’re willing to sacrifice as much as 29% of their salary. Hopefully this isn’t your biggest incentive to start an employee engagement program, but it should definitely pique your interest.

All you need is a 10% increase in employee engagement investment

A study by Talent Culture found that companies can increase profits by $2,400 per employee each year by simply investing 10% more into employee engagement. If you need some help convincing leadership of the benefit of boosting employee engagement, just show them some of the statistics in this article.

 

employee Engagement and retention

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Employee turnover costs the United States $11 Billion each year

True story: $11 billion dollars is lost to employee turnover every year. Think about all the time and money it takes to recruit, hire, onboard and train a new hire. If you're only investing in employees for the short term, they're not going to stay for the long term.

Employees also care about engagement

According to 14% of employees, the top reason why they change employers is because they want to work somewhere they feel engaged. Feeling engaged at work can be very rewarding, and those that recognize the difference know when they have it and when they don’t. 

One third of employees are bored at their job

Turns out, being bored with your job is enough motivation for 33% of employees to want to leave their current jobs. 

It’s hard to be engaged once you've burned out

More than 60% of employees report being burned out at their current job, and once you’ve burned out, it’s hard to reengage with your work no matter how much the company changes. Offer burnouts new challenges and opportunities to change roles within the company or even to leave the company and boomerang back later down the road. 

Great Company culture significantly improves retention rates 

Companies with great culture boast an employee turnover rate of just 13.9%. It shouldn’t be surprising that if people are surrounded by a great culture they're more likely to enjoy work and their colleagues, giving them fewer reasons to consider other employment opportunities. 

Poor company culture significantly decreases retention rates 

Companies with poor culture have a staggering turnover rate of 48.4%. Especially with unemployment at a record low, it’s no wonder employees are quick to change jobs for a company that has better culture. They have plenty of options.  

Employees also expect companies to support work-life balance

Work-life balance is deeply rooted in a company’s culture and a manager's willingness to foster an environment that allows employees to coordinate their work and personal lives. 87% of employees expect to be supported in balancing their work-life balance by their employer. 

Yet roughly a quarter of people quit because their company doesn’t 

27% of people leave their job because the company and culture don’t support an individual’s personal life beyond work. Employees are no longer willing to sacrifice their personal lives, families and activities for work, and they shouldn’t have to. Work should be a means to live a long and happy life, and the days of working overtime to climb the corporate ladder are coming to an end.

If you’re not flexible, there are plenty of other companies that are 

If you want to stay competitive as an employer and don’t want to lose great employees to something as simple and respectful as supporting their personal endeavors, join the 36% of employers who do offer flexible work opportunities.

 

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