October 23, 2013

It’s often said that an organization’s biggest asset is its people. But studies are finding that may be true only if the employees are actively engaged in their jobs.

young business woman

The sad fact today is that only 30 percent of employees nationwide are engaged, committed and enthusiastic about their work. The other 70 percent – and that includes managers, executives and professionals as well as lower-level employees – are either not engaged or, worse, actively disengaged, according to research by the Gallup organization of millions of American workers.

So, at a time when America is trying to climb out of a devastating recession, half of its 100 million workers are essentially “checked out,” not engaged, and don’t really care if their companies succeed or not.

And another 20 million are “actively disengaged,” downright antagonistic toward their employers and often undermining the work of engaged employees, Gallup reports in its new State of the American Workplace study.

The cost of this level of disengagement is staggering – a loss in productivity of more than 43 percent for an estimated national cost of $450 billion to $550 billion a year.

What members of the workforce are most engaged … and disengaged? Engaged employees are described by Gallup as those who are involved in, enthusiastic about and committed to their work and contribute to their organization in a positive manner.

Engaged employees are the ones who are most likely to drive innovation, growth and revenue, as well as build new products and services, generate new ideas and create new customers. They are always willing to go the extra mile because of their commitment to the company.

  • 36 percent of managers and executives
  • 34 percent of physicians
  • 31 percent of teachers
  • 30 percent of non-healthcare professionals
  • 29 percent of salespeople
  • 29 percent of service workers
  • 27 percent of clerical workers
  • 25 percent of transportation employees
  • 24 percent of manufacturing workers

Those who aren’t engaged – more than half of the workforce in every occupation – are basically just putting in their time, waiting for lunch and doing what they need to do to get through the day to get their paychecks.

But those who are actively disengaged have a negative impact on the organization. They are more likely to steal, miss work, negatively influence coworkers and drive customers away.

The percentage of actively disengaged employees in different occupations includes:

  • 28 percent of transportation employees
  • 26 percent of manufacturing workers
  • 22 percent of service workers
  • 20 percent of salespeople
  • 19 percent of clerical workers
  • 15 percent of professionals
  • 13 percent of teachers
  • 13 percent of managers and executives
  • 9 percent of physicians

How do demographics affect engagement?

  • Generations at the beginning and the end of their careers tend to be more engaged than those in the middle.
  • Employees who have worked for the company for less than six months are most engaged (52 percent).
  • Women have slightly higher overall engagement levels than men (33 percent to 28 percent).
  • Employees with a college degree are the least engaged of any educational level (28 percent), leading researchers to conclude that many college graduates may feel unempowered or trapped in a bad job.
  • Perhaps surprisingly, those at the lowest education level who don’t have a high school diploma are most engaged in their jobs (34 percent).
  • Small companies with fewer than 10 employees have the highest level of engagement (42 percent). Those with 10-24 employees have the lowest (27 percent).

How can companies improve engagement?

While perks and benefits may make employees happier, the Gallup study found that happy employees are not necessarily engaged employees. The study found that engagement had a greater effect on an employee’s well-being than any benefit.

The one benefit the research found that yielded the strongest impact on engagement was flextime. Engaged employees with a lot of flextime had 44 percent higher well-being than actively disengaged employees with little or no flextime.

Management training is the key to employee engagement, the research found, because managers are the most powerful influence on their employees’ engagement levels. Poor managers are often the source of employee disengagement.

Leaders play the most significant role in driving employee engagement, so greater efforts made to engage managers at every level “may hold the key to jump-starting workplace engagement nationwide.” The report recommended:

  • Managers must learn to deal with employees’ individual needs and expectations based on age, gender, educational level, tenure and other variables. The best managers recognize the fundamental differences among team members.
  • Employees flourish when they do what they do best and are regularly recognized for it. Determine what skills and talents individual employees excel at and position them in the right jobs to maximize those abilities. When employees know and use their strengths, they are more engaged.
  • Great managers display genuine care and concern for their people. By building strong, trusting relationships, they create an open, positive atmosphere where employees feel supported.
  • Managers need to realize that every interaction they have with an employee has the potential to inspire or deflate engagement level.
  • Employee engagement is highest during the first six-month “honeymoon period” while employees are excited to be part of a new organization. There is a significant dip after that. Management should take steps to improve onboarding processes, listen to the opinions of new employees and give them a lot of recognition for early efforts.
  • Most employees are better able to engage with a company if they truly understand what the organization’s mission and purpose is. Managers should help employees to internalize this information.

All organizations can benefit by reviewing their management practices to see if they are doing everything they can to improve employee engagement.

It will pay off in the long run for your employees – and for your business.

This article was originally posted on October 23, 2013 and the information may no longer be current. For questions, please contact GRF CPAs & Advisors at marketing@grfcpa.com.