According to Gallup, Lack of employee engagement costs the economy $1.9 trillion.
Luis Alvarez
Employees who aren’t engaged at work may cost the economy $1.9 trillion, according to Gallup.Workers feel increasingly disconnected from their workplaces and feel their expectations are unclear.Managers are also experiencing burnout after layoffs and major team restructuring over the past few years.
A lack of employee engagement at work may cost the economy nearly $2 trillion as workers are dealing with unclear expectations, weak connections to their companies, and lower satisfaction levels.
A new report from Gallup found that absent US engagement in the workplace amounts to $1.9 trillion in lost productivity, given that only 33% of employees noted they were engaged. Gallup estimated “the dollar value of lost productivity accounted for by not engaged and actively disengaged employees” using a statistical model of how engagement affects productivity and how much economic value better-engaged employees would generate.
Employees reported feeling more lost at work in 2023, noting how they feel detached from their employers. Employees said they’re less able to connect with their company’s mission and feel less satisfied with how their organizations operate. A decreasing number also said people at work care about them.
And their managers are burning out too, according to Jim Harter, chief scientist of workplace and well-being at Gallup who authored the article.
“As it sits, managers have declining engagement in their jobs, they report increasing levels of burnout, and are more likely to be looking for different jobs,” Harter said. “With the changed workplace since the pandemic, their jobs have become more complex than ever before.”
Stagnant employee engagement
Compared to 2020, employees are much less likely to know what is expected of them at work, according to Gallup’s analysis of over 112,000 teams and business units. Among exclusively remote employees, 47% know what their bosses expect of them in 2023 — compared to 59% in 2020. The gap was larger for hybrid workers at 54% in 2020, followed by 41% in 2023.
“When people are not clear on their roles, and how their role relates to their coworkers’ roles, they are less effective in meeting customer needs and other important outcomes that leaders expect,” Harter said. “Uncertainty is not a good thing when it comes to managing a workforce. Managers and executives lose credibility and employees then feel less responsible for great customer service.”
Gallup reported improvements in these statistics for 2023 on the whole, though factors such as having the opportunity for workers to do what they do best and having the right materials and equipment have declined since midyear. Younger workers have seen more sizable improvements in clarity of expectations but are still below 2020 levels.
Gallup said this overall decline stems from the major restructuring of teams at many companies, additional job responsibilities due to staffing challenges, and limited training for managers to lead remote teams. This has contributed to declines in the degree of meaningful feedback, team cohesion, and resources for maintaining well-being.
Engagement has risen nearly every year between 2005 and 2020 before dipping at the pandemic’s start. The percent engaged in 2023 was 33%, down a percentage point — or about 1.6 million employees — from the year’s halfway point. This comes as the proportion of employees in hybrid and remote positions stabilizes, as 52% of those in remote-ready jobs work hybrid.
The percentage of actively disengaged workers has fallen to 16% in 2023 from 18% in 2022. Gallup defines active disengagement as “loud quitting,” meaning they’re more vocal about their dissatisfaction.
“With the labor market in recent years, people who have had disengaging jobs, whether vocal about it or not, have had some choice to find other work,” Harter said. “Job choices make it more likely that people will get out of miserable work situations. But increased turnover and new staffing brings other consequences — new employees are not as likely to be in sync with their coworkers making role clarity an issue.”
Managers still have a long way to go in improving employee engagement, though Gallup posits managers and employees should have more regular “meaningful conversations.” These include discussions about employee strengths and goals, opportunities for collaboration, and how employees’ work impacts the larger organization. Such discussions also cover what coworkers are expected to do, which helps employees know where they fit in and helps people discover their niches.
Harter also said organizational leaders will need to shift the responsibilities of managers to “be more like coaches than administrative bosses,” as well as continue hiring and developing the most engaged, talented, and skilled managers.
“While work flexibility is one of the most desired perks or expectations in the new workforce, organizational leaders will need to create cultures of high accountability and development,” Harter said.
Are you not engaged at work? Do you feel disconnected from your company’s mission? Reach out to this reporter at nsheidlower@businessinsider.com.