Employee disengagement costs businesses US$8.8 trillion a year. Here’s how to spot it…and how to turn it around.
Disengaged employees can torpedo your chances of success - reducing productivity, innovation, and customer satisfaction.
If you suspect your business has an engagement problem, you’re not alone. New research for 2023 reveals majority of organizations have shockingly low employee engagement.
Luckily, there are things you can do to buck the trend and get your employees more engaged at work.
We’ve scoured the latest workplace research for actionable advice on re-engaging disengaged employees.
Here’s your coffee break briefing on:
According to Gallup’s State of the Global Workplace 2023 Report, employee engagement is on the rise and reached a ‘record high’ in 2023.
But don’t let that fool you into thinking employee engagement is soaring.
Even this year’s record-breaking level is still only 23% globally (less than a quarter of the workforce) and 32% in the US (a third of the workforce). This means the vast majority of employees are disengaged at work.
Globally, 59% of employees are ‘quiet quitting’, meaning they are not engaged at work. And 18% are ‘loud quitting’, which means they are actively disengaged. Maybe even antagonistic. And when disengaged employees become vocal about your business, it can be highly detrimental to your reputation.
There is a high cost to low engagement. Disengaged employees cost the global economy US$8.8 trillion a year - accounting for 9% of global GDP. This means reigniting the passion of disengaged workers is a huge opportunity for economic growth.
According to Gallup, businesses with more engaged employees outperform their competitors across the board.
Organizations scoring in the top half on employee engagement more than double their odds of success compared with those in the bottom half. Those at the 99th percentile have nearly five times the success rate of those at the first percentile.
The good news is you CAN re-energize disengaged employees and reap these benefits in your business.
Organizations that implement engagement best practices buck the global trend with a respectable 72% engagement rate. That means almost three-quarters of their workforce are actively involved and enthused by their work. [Source]
The first step to achieving those trend-busting engagement rates is to identify disengaged employees - and then implement a strategy to re-engage them.
There are lots of reasons people can become disengaged at work.
It’s important to remember that - although their actions may have negative consequences - disengaged employees aren’t bad people. They may just be sad people. And it’s never too late to turn that around.
Signs of employee disengagement can be subtle and hard to attribute - like reduced productivity and decreased customer satisfaction. Or they can be crystal clear - like a toxic culture and negative attitudes.
You might spot signs of disengagement at an individual level - seeing specific employees disengage from their work - or at an organizational level - noticing widespread problems in your business.
Apathetic - Disengaged employees are apathetic about their work and don’t approach it with energy or enthusiasm. They don’t do more than the minimum required of them and don’t show initiative.
Unreliable - Disengaged employees can be unreliable. They may turn in work late or to a low standard, reject meeting invitations, or call in sick more often than others.
Isolated - Disengaged employees may isolate themselves from others and choose to focus exclusively on their tasks rather than team goals. They may distrust their manager or colleagues.
Change-resistant - Disengaged employees may be resistant to taking on new tasks, learning new software, or working with new people. They’re less likely to engage in training and development.
Reactive - Disengaged employees may wait to be instructed about what to do rather than proactive and self-directed. They may actively withhold new ideas.
Vocal and critical - Disengaged employees may choose to make their feelings known by being critical of the business, their manager, and even colleagues.
Unhappy - Sadly, disengaged employees may be very unhappy at work. This can translate to emotional and physical health problems, which makes engagement an employee wellbeing issue too.
Productivity is down - Disengaged employees undermine productivity. They may feel there’s no challenge, no opportunity to progress, no penalty for poor performance, and hard work goes unrecognized. As a result, they deliver the bare minimum to keep their job (whilst looking for their next one).
Absenteeism is up - Disengaged employees are more likely to be absent from work. For many, this could be due to ill health related to work. For others, it could simply be a poor personal work ethic and less guilt about pulling a sickie.
The culture’s turned toxic - A bad apple can poison the whole barrel. It is the same with disengaged workers. A negative attitude can reduce the morale of all staff, leading to a grumble-filled, grouchy company culture. Once this sets in, it can drive away positive, engaged employees. So it needs nipping in the bud.
People are leaving - Poor engagement can lead to higher staff turnover. This may be disengaged employees leaving for different work, or dedicated employees driven away by a toxic culture. Reduced employee retention increases costs for your business - not only in terms of recruitment and training, but also lost productivity and institutional knowledge.
Customers aren’t happy - Actively disengaged employees are less inclined to go the extra mile for the business or its clients. This can result in poor customer service, a tarnished reputation, and reduction in repeat custom. Staff turnover can also disrupt client relationships and result in reduced satisfaction.
Innovation is AWOL - When disengaged workers do the bare minimum, they’re less inclined to innovate. They’re unlikely to engage in brainstorming sessions - for example - or to think of ways to improve the customer experience. This can stifle innovation and growth, and leave you vulnerable to competitors.
If you spot any of these signs in your workplace, it’s time to turn the tide on disengaged employees. Here’s how.
Here are 12 ways to keep employees engaged - or re-engage employees that have lost their way at work.
If you don’t already see your people as your most important resource, it’s time to. Quantum Workplace surveyed 136 companies to understand what makes engaged workplaces different from others. And one of the key drivers was how senior leaders see their people.
More than 72 percent of employees at the most engaged companies said they felt leaders valued people as their most important resource, compared to only 39 percent of employees at the least engaged companies. And 1/5 of employees at the least engaged organizations said leaders DON’T value people as their most important resource.
This is validated by research from Gallup. They found people are more likely to be engaged when they agree with the statement ‘Someone at work cares about me’.
Like we’ve always said… putting your people first is a savvy business strategy.
‘The data from the present study provide further substantiation to the theory that doing what is best for employees does not have to contradict what is best for the business or organization.’ Gallup, State of the Global Workplace 2023 Report
Employees are more likely to be engaged if they believe their organization will be successful in the future - and if they understand how they contribute to it.
When employees believe their company will be successful in the future, they are more likely to be engaged,’ says Quantum Workplace. Employees at the top quartile companies were 25 percent more likely to [agree with the statement] that ‘I know how I fit into the organization’s future plans.’ Whilst employees at the bottom quartile companies were 3.4 times more likely to disagree or strongly disagree, saying they didn’t know how they personally fit into the company’s future plans.
Senior managers need to communicate a clear purpose and meaningful vision. Or work with their employees to co-create it. And team leaders need to provide individuals with clarity on how their work ladders up to that purpose - to foster a sense of accomplishment, contribution, and ownership of success.
Great managers help people see not only the purpose of their work, but also how each person’s work influences and relates to the purpose of the organization and its outcomes. Reminding employees of the big-picture effect of what they do each day is important. Gallup, State of the Global Workplace 2023 Report
People are more likely to be engaged at work if it aligns with their skills and ambitions. Aligning work to their skills helps people feel in control and able to showcase their expertise. While aligning it to their ambitions gives them room for challenge, growth, and development.
Helping people get into roles in which they can most fully use their inherent talents and strengths is the ongoing work of great managers, says Gallup. How employees are coached can influence how they perceive their future. If the manager is helping the employee improve as an individual by providing opportunities that are in sync with the employee’s talents, both the employee and the company will profit.
Our COO Nicole believes that aligning work to employees' interests and passions is also a way to move from transactional to strategic resource management.
Over the past two years, we've witnessed an even greater departure from the status quo. While an individual might possess the appropriate skills, there's growing recognition of the value in learning opportunities.
Organizations can emphasize personal interests and passions, integrating them into the decision-making process alongside skills. For instance, consider a scenario in a professional services context, where a project involves developing a website for a major guitar manufacturer. While one engineer may excel in technical implementation and Java programming, another who's deeply passionate about playing the guitar might offer a unique perspective that enriches the project's long-term impact.
However, it can be difficult to keep on top of what skills your employees have and want to develop. This is where a skills management process is very beneficial. We've dedicated a few articles to skills management here:
Some people become disengaged from work because they don’t have the skills they need to do it - as shown by this matrix based on categories coined by Sibson Consulting.
Perhaps they’ve been given new duties and are too embarrassed to say they don’t know what to do. Maybe there’s more new software and they feel too tired to learn it. Maybe work is evolving around them and they feel overwhelmed.
In these circumstances, managers need to identify skills gaps that are causing anxiety and disengagement - and work with the employee to address them. By providing training for people in the ‘disengaged’ and ‘enthusiasts’ quadrants, you can hopefully convert them into engaged employees.
As for the renegades…they’re trickier to fix.
One of the key reasons people give for leaving their job is lack of opportunity to progress. Of workers who quit a job in 2021, 63% cited no opportunities for advancement as the reason.
One way to encourage people to ‘stay and strive’ is to outline career paths with clear timelines and requirements.
Giving people a transparent path to their next career goal - especially one that is attainable but still allows employees to stretch and grow - can encourage more loyalty and engagement.
This can be more important than financial reward, say Aon Hewitt.
Non-monetary recognition can be a more important driver of retention than compensation. [...] improving perceptions of future career opportunities not only improves engagement, but also improves the likelihood that employees will stay.
This approach also creates a meritocracy where people rise through the ranks based on effort and expertise rather than length of service, for example, which benefits the business further. And supports strategic succession and capacity planning.
To improve employee engagement, you first need to measure and understand it. Savvy businesses survey their staff, seek employee feedback, and get employees involved in decision-making.
Quantum Workplace sums up the process as ‘Ask. Aha! Act.’
Connected organizations also communicate effectively with the wider workforce - inviting dialog rather than simply broadcasting information.
Use surveys to collect feedback, host Q&As with your leadership team, ask employees to answer anonymous questions, have suggestion boxes… anything to gather employee experiences and perspectives.
Importantly, organizations need to act on what they’re told. Otherwise, the whole process can backfire, with employees wondering why they bothered saying anything in the first place!
Employee autonomy is about giving staff more freedom and responsibility to use their judgment and make decisions. It’s proven to be beneficial for lots of reasons. In the context of re-engaging disengaged employees, it shows people that you trust them, which is rewarding and validating in its own right.
But it also gives people more of a sense of ownership in business outcomes. Employees are often closer to local opportunities and challenges than more senior managers, so they can often make better, faster decisions.
This contributes further to employees’ sense of making a positive impact - for example, delivering better results for customers and therefore the business. And who doesn’t go home with a smile on their face if they know they’ve made a difference that day?
It’s often said that ‘people leave managers, not jobs’. But management is difficult...and the role is changing as the world of work evolves.
Team leaders are key to creating an environment where employees feel valued, energised, and thrive. They have to:
Organizations that want to reduce their number of disengaged employees should start by upskilling their managers.
The Society for Human Resource Management cites a 2017 Dale Carnegie study that found a third of leaders ‘occasionally, rarely or never’ think about employee engagement. If it hasn’t already… that needs to change.
If you want your employees to do a great job, it makes sense to give them the tools they need.
But research shows that providing people with relevant resources doesn’t JUST help them do their job, it encourages them to do more.
That’s because properly equipping employees communicates respect and value for their work - which contributes to higher engagement.
According to Aon Hewitt, ‘Employees are more likely to give extra effort if there are systems in place that enable them to contribute. Protracted processes and lack of resources frustrate employees and stifle discretionary effort’.
Why? Gallup explains. ‘Getting people what they need to do their work is important in maximizing efficiency, demonstrating to employees that their work is valued, and showing that the company is supporting them in what they are asked to do.’
Employees need to know that they’re doing a great job - and that what they’re doing matters.
Recognize employees frequently and before the moment passes. If an employee does great work but you don’t recognize that until the next monthly meeting, they may think their contribution has gone unnoticed.
Get to know how individual employees like to be recognized. Some may prefer a quiet congratulations in a 1-2-1 with their manager, others might prefer public recognition at a team meeting…
According to Quantum Workplace, organizations with formal employee recognition programs have 31% less voluntary turnover than organizations that don't have any program at all. And they're 12x more likely to have strong business outcomes.
On one hand, research shows that money isn’t everything. When it comes to working life, people want to feel valued and have purpose too. On the other hand, in an increasingly competitive and global talent pool, you can’t afford to ignore people’s pay expectations.
One way around this conundrum is to create a performance-pay structure. This meets pay expectations whilst also providing a framework to recognize and reward higher engagement. For example, pay increases associated with professional development or achievement of KPIs.
According to the Society of Human Resource Management,
Strategic compensation uses pay-for-performance programs to focus employees' attention on incentivized behaviors. Competency-based pay encourages acquisition of knowledge and skills and enhances employee performance.
This approach combines higher pay with an enhanced sense of being seen and valued - which can lead to more discretionary effort and loyalty to your business.
One way to guarantee employee dissatisfaction is to overload them with too much work, more than their fair share, or work that is beyond their current capabilities.
Part of being a responsible, people-first employer is ensuring employees have a manageable workload.
But maintaining oversight of that can be difficult at scale. Especially in project-based businesses where multiple project managers are assigning tasks to different resources. Or in newly remote teams where people aren’t sure yet who’s who or working on what.
More than ever, businesses need visibility into their capacity and utilization across all team members.
This ensures they can assign work to people who have the skills and availability to take it on - and that work is fairly distributed across all team members. Otherwise, people can become burdened, burnt out, and resentful.
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