Disgruntled employees cost U.S. companies an estimated $1.9 trillion in lost productivity last year, according to research from Gallup that puts a price tag on workplace unhappiness. The stakes are high for companies because an engaged workforce increases productivity and that helps boost sales and profit.
In 2023, employees in the U.S. continued to feel more detached from their employers, with less clear expectations, lower levels of satisfaction with their organization, and less connection to its mission or purpose, than they did four years ago. They are also less likely to feel someone at work cares about them as a person. These are among the findings of Gallup’s most recent survey of U.S. employee engagement, which stagnated for the second half of 2023 following a slight improvement earlier in the year.
At midyear, 34% of U.S. full- and part-time employees were engaged in their work and workplace. For the full year of 2023, 33% were engaged, reflecting a slight recent decline. This figure lags the annual high — since Gallup began reporting U.S. employee engagement in 2000 — of 36% in 2020 and a peak of 40% in late June of the same year. The engagement peak occurred after a decade of steady growth, followed by two years of decline, beginning in the second half of 2021 when it dropped to a 32% low in 2022. On a positive note, the percentage of actively disengaged workers has declined from 18% in 2022 to 16% in 2023.
Connecting better with staff can improve worker retention. Having motivated employees is linked to “a lot of different outcomes that are important to organizations,” said Jim Harter, chief scientist for Gallup’s workplace practice.
Gallup calculated the cost of reduced productivity by estimating the dollar value impact of an employee being unengaged and then extrapolating that for the working population. The overall hit to the global economy totaled an estimated $8.8 trillion, the company said. To remedy this, Harter suggested individual weekly check-ins and guidance on how to work with their coworkers. When employees are told how to collaborate with one another, role clarity rose to about 80% from less than 50%. This kind of strategy is especially needed for younger workers because they are much more likely to switch jobs in search of a more fulfilling work-life balance.
Courtesy of SBAM-approved partner, ASE. Sources: Gallup 1/23/24; Bloomberg 1/23/24
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