Today’s businesses face unprecedented challenges in engaging and retaining employees. This year’s employee engagement state is proof that we’re still a long way from answering the needs of a large portion of the workforce.
Globally, employee engagement is declining, after hitting an all time low in 2014, with only 65,9% of employees engaged, according to Quantum Workplace.
Gallup U.S Daily estimates U.S. employee engagement at 32.1% for November 2015, with a current year-to-date average of 31.9%, despite the improving economy. The UK is also experiencing a worrying decline in employee engagement. According to Office for National Statistics figures, in 2015 UK workforces are 31% less productive than those of the US and 17% less productive than the rest of the G7 countries (Source).
More research from Aon Hewitt shows that less than half of global employees (46%) think they are paid fairly for what they contribute (a perception unchanged in the last year) and even though there has been a slight improvement in other key engagement drivers like the employee value proposition, recognition, and innovation, the overall net change in the average employee’s work experience is negative.
Progress is slow
Although companies are admitting that talent and people analytics should be a high priority and a tremendous opportunity, progress is still slow. According to the 2015 Human Capital Trends report by Bersin for Deloitte, analytics is on the agenda of almost every HR team surveyed, with three in four respondents rating it as “important” or “very important.”
But despite this interest, analytics capabilities note very small improvements from last year. In fact, thirty-five percent of this year’s respondents reported that HR analytics was “under active development” at their organizations—just slightly more than the proportion of respondents who said the same last year (33 percent), with only 8.44 percent of the respondents believing that their organizations have a strong HR analytics team in place.
Leadership development is also a sore spot in terms of improvement. The same report shows that fewer than 50 percent of C-suite executives feel they are receiving any development at all and only 6 percent of survey respondents report they have “excellent” programs in place to develop Millennials, despite the fact that 53 percent of Millennials aspire to become the leader or senior executive of their own organization.
This leads to a weak leadership pipeline that will have a negative impact on employee engagement in the years to come, considering that managers account for as much as 70% of variance in employee engagement scores (Gallup).
How do we fix this?
Companies need to identify the particular employee engagement drivers in their teams and invest in a strategic plan that can improve them and connect them to business results.
Among all organizations, there’s a desire to increase employee engagement, improve talent recruiting and retention and better employees’ health and wellbeing (Virgin Pulse – State of the industry: engagement and wellness in 2015). While executives’ objectives align with overall organizational objectives, managers prioritize talent recruiting and retention over other areas.
Managers need to work on building trust and providing a strong employee value proposition. Communication and business transparency are key to this endeavor, empowering employees with the necessary knowledge to perform well and stay longer.
Furthermore, leaders need to start viewing HR managers as HR business partners. As Josh Bersin points out in his latest research, by improving and expanding HRBP skills, HR functions can drive value and relevance, working with line leadership to build a deep understanding of business and talent pressures and translating business strategies into people-focused initiatives.
View other stats on employee engagement, identify key engagement drivers and other business solutions to this engagement crisis in our State of Employee Engagement in 2015 report here.