Looks like employee engagement is on the rebound, according to a recent survey by Gallup!¹ Having dropped in 2020 and '21 for the first time in years, the trend reached a record high of 23% in 2022. This indicates that more employees felt better connected in the workplace and considered their work more meaningful, Gallup reports.
This is good news on multiple levels. In fact, the benefits of employee engagement are no surprise to highly successful organizations. Especially not to those leaders who believe that providing a positive company culture of engaged employees is one of their most important jobs.
Successful business leaders and HR professionals tend to understand the advantages of individual and team engagement within the workforce. They recognize the elements of the employee experience that typically improve employee engagement and help drive desired business outcomes. They're in tune with how and why to measure its presence or absence. And they're intent on fostering its growth as part of a comprehensive employee engagement strategy.
Here we'll explore the essence, the importance and the drivers of employee engagement to help you recognize, measure and boost engagement in your own organization.
The textbook definition of employee engagement is the degree to which employees invest their energy toward meeting company goals and outcomes. It’s not just about working hard or collecting a paycheck. It’s also about being emotionally invested in organizational success.
Engaged employees care about the work they are doing and the company for which they work. They believe in the company’s mission, and they're focused and committed toward helping fulfill it. They're motivated to work hard, deliver on individual and shared goals and get the job done.
The telltale signs of an engaged employee are easy to spot and important to acknowledge. Indicators include when an employee:
Employee engagement does not necessarily reflect how happy an employee is at work. But feeling connected, committed and engaged at work can play a role in overall job satisfaction and employee happiness.
When people feel challenged and passionate about their work and employer, the positive vibe creates a notable ripple effect. This can influence everything from recruitment efforts to increases in team engagement, employee retention, career development, employee satisfaction and beyond.
The concept is both proven and measurable. Year after year, study after study, employee engagement research affirms the relevance and value of highly engaged employees and their contributions to organizational success. According to Gallup, organizations with the most engaged workforces realize notable differences and improvements in:
Given its significance, many business leaders pursue deeper analysis of the concept and the extents to which their own employees engage. Fortunately, workforce engagement isn't hard to assess.
Measuring employee engagement can be as much an art as it is a science. Over the years, tools and techniques have been developed for both formal and informal means to gather feedback of value. Whether that feedback is positive, negative or neutral, it's necessary to support company efforts toward improving employee engagement.
Informal means include the more traditional, intuitive approaches, such as impromptu check-ins and candid, casual conversations. Employees who feel comfortable sharing their insights and experiences with leadership can act as a barometer of sorts. On an even less-formal note, you can often measure employee engagement just by walking into a workplace unannounced. Are employees focused and working diligently, either independently or collaboratively, to achieve company goals? Do you get a sense that people are on a mission to get their jobs done for mutual cause or benefit? Are you recognizing the signs of employee engagement or disengagement over repeated informal attempts to identify it?
Formal means for measuring individual or team engagement typically involve more analytics than intuition. They range from soliciting employee feedback via pulse surveys, employee engagement software and more to establishing and evaluating key performance indicators.
Useful KPIs can help you identify and measure baselines of employee engagement and disengagement and the effectiveness of past, present and ongoing engagement initiatives.
When employees are unengaged, you may first see the warning signs in their behavior. Signs of disengaged employees include:
Some behaviors might be noticeable; others may require additional investigation to uncover. Your HR software can help you manage the KPIs that signal when employees are not giving their all at work. Ultimately, examining the right KPI metrics as part of company employee engagement strategies can inspire new ideas for specific employee engagement initiatives. Consider the following common KPIs as an exact guide or inspiration to shape your own.
Studies show that businesses with highly engaged workforces experience lower absenteeism rates than other companies. So keeping an eye on absenteeism can help you uncover problems with engagement. Here's how to calculate it.
Absenteeism = (Number of unexcused absences / measurement period) x 100
If your company experiences significant turnover, that's another sign that employees may not be engaged. Consider including this critical KPI metric in your regular reporting.
Employee turnover rate formula
Employee turnover rate formula = (Number of employees who left the company / average number of employees during the measurement period) x 100
Organizations should keep a close eye on turnover rates and benchmark them against other companies in their industry for context. For example, a turnover rate of 30% may seem very high to you, given your industry experience. But many contact centers experience annual turnover rates as high as 50% to 60%. A 30% employee turnover would be exceptional for them.
One of the keys to employee retention and engagement is providing opportunities for career development and advancement. Tracking the rate of internal promotions will illuminate whether this is a strength or weakness in your organization.
Promotion rate formula
Promotion rate = (Total number of promoted employees / Total number of employees) x 100
Companies use the net promoter score (NPS) as a tool to gauge customer loyalty: How likely are customers to recommend you to others? You can also use NPS to gauge employee loyalty, via employee engagement surveys. Engaged employees are often also advocates for their companies, and they tend to provide great customer service.
An employee net promoter score (ENPS) survey is simple to administer. Employees are asked to answer one question on a scale of 1 to 10: How likely are you to recommend our company as a place to work?
Those who score in the 9 to 10 range are considered "Promoters." Those scoring 0 to 6 are "Detractors." Others who rank your company in the 7 to 8 range are considered neutral.
Net promoter score formula
Employee net promoter score = [ (Number of total promoters – Number of total detractors) / Total survey respondents ] x 100
Anything above zero reveals you have more Promoters vs. Detractors. But a score of 30 is considered good, and 50+ is considered excellent.
NPS and ENPS are good ways to uncover hidden problems within your organization. While these metrics won’t tell you specifically what the problems are, low scores should be taken seriously and lead to more in-depth investigation.
An employee satisfaction index (ESI) measures how satisfied employees are in the workplace. It differs from NPS by asking several questions. Typically, ESI surveys ask three questions based on a scale of 0 to 100, such as:
Each response provides insight into how employees feel. The ESI can be expressed overall or broken down by divisions, departments or work units. Scores averaging 70 or more are generally considered high, while scores less than 60 are considered low.
An important part of maintaining high levels of engagement is performance management. Highly engaged employees consistently meet or exceed goals. By tracking whether goals are being met, you can often tell how employees are responding to your efforts and staying engaged.
How your company is perceived by those outside your organization can play a big part in whether employees remain engaged. If you’re offering jobs to candidates and they are turning you down, it might be because your company culture needs some work. Therefore, it's especially important to track candidates who interact with your employees during the hiring process.
Offer acceptance rate formula
Offer acceptance rate = ( Offers accepted / Offers made ) x 100
Acceptance rates outside the norm can reveal problems. You may need to revisit your compensation and benefits to make sure they are attractive. It can also signal to current employees, especially your top performers, that there are better jobs out there and cause them to start looking or stop engaging.
It's not technically a KPI you need to measure, but you’ll still want to pay attention to what current and former employees are saying about your company online. Disgruntled employees and their scathing reviews aside, you can often judge a lot about a workplace from what people write.
Despite the upsides, many leaders argue that collecting metrics around something so “nebulous” as employee engagement is next to impossible. That perspective may have merit as well. So measure your KPIs carefully, but also trust your gut. If something doesn’t feel right, take the time to figure out why. Remember the primary point of all your engagement efforts: Getting your workforce engaged will be crucial to company success.
If you’re unsure about where your employee base stands in terms of engagement, consider taking a pulse by distributing an employee engagement survey. Develop an employee engagement score system to see where employees land in categories as they relate to teams, managers, leaders, communication, culture and more.
Having collected quantifiable feedback pertaining to multiple areas of your business, you’ll be able to slice and dice data according to chosen variables. You can then zero in on where your team is doing well and where to focus attention.
When you offer employee surveys, you demonstrate genuine care in how your team is doing. From an employee perspective, having the opportunity to deliver feedback goes a long way toward creating a positive employee-employer relationship.
Even once you have a vision and some useful tools for how to increase employee engagement, your job's just begun.
As a manager, it can be challenging to keep your teams productively humming amid the bustle and distractions. Understanding the ins and outs of employee engagement activities can make all the difference for driving a successful year ahead.
You’ll want to pursue activities that can drive engagement, especially during lulls in the calendar. And rest assured, these activities don’t need to break the bank.
Consider the following employee engagement activities to help keep your workforce connected and committed. Also consider asking your teams and managers for their ideas.
By choosing even one or two of the engagement activities above, you’ll be well on your way toward supporting a more engaged workforce. Employee engagement is more about the journey than the destination. We know it’s a constant work in progress, so keep your engagement surveys, scores and activities rolling.
At TriNet, we help organizations and HR professionals create thriving, engaged workforces every day. For information about how our professional employer organization (PEO) offerings can benefit you and your people, speak with a knowledgeable representative today.