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Future-proof your employee engagement strategy by keeping up with important employee engagement statistics and research.
Engaged employees are more motivated and productive. They strive to go above and beyond at work simply because it fulfills them. They are lit up by their goals and eager to collaborate and contribute to organizational success.
Engaged employees are more satisfied and happier, of course, but engagement shouldn’t be confused with job satisfaction, since it also involves a desire to perform.
With all this in mind, most leaders would agree that they care about employee engagement. But many of them would also admit that improving employee engagement can be challenging.
The Challenges of Improving Employee Engagement That’s because employee engagement is both an art and a science. It can be quantified and measured, but it also involves people – and people are complex. Employee engagement is about the emotional relationship that workers have with their jobs and organizations, which involves several facets.
Not to mention the fact that different teams have different challenges when it comes to employee engagement.
For example, some organizations may do a great job engaging employees through perks and benefits yet struggle to offer career advancement opportunities. Some leaders do a great job keeping remote workers engaged, others are not equipped with the tools needed to do so. Some HR leaders measure employee engagement regularly, others don't know how to do it effectively.
Given all of these factors, if you want a highly engaged team, you have no choice but to stay on top of employee engagement research and trends so you can future-proof your people strategy and prevent disengagement.
Employee Engagement Statistics You Need to Know In 2025 Ready to refine your understanding of employee engagement? Here are over 40 employee engagement statistics to inspire your efforts.
According to Gallup’s global employee engagement indicator, only 33% of U.S. employees are engaged – which means 2 out of 3 employees are not. That’s an alarming reality for leaders everywhere.
Employee engagement rates in the U.S. have yet to reach their 2020 peak again (36%).
The same Gallup data also shows that the rate of organizations with best practices for employee engagement is on the decline. It is currently sitting at 70%, a two percent year-over-year drop.
Meanwhile, actively disengaged employees cost the U.S. about $1.9 trillion in lost productivity.
This opens a few interesting questions: Can this drop be attributed to the fact employers have cut back on offering remote and hybrid roles? Research shows that flexibility can play a role in engagement levels (more on that later).
Does the state of the economy have anything to do with it? In the midst of a tough job market for applicants and mass layoffs making the headlines, some organizations may be slashing their HR budgets and thus sacrificing best practices in the process.
Management is struggling to keep up with some of the notable shifts happening post-pandemic, which has an impact on the number of highly engaged employees in today’s workforce.
Over half of managers told Gallup that restructuring their teams has been a major complication since 2020, and 64% of them say that employees now have additional job responsibilities. Additionally, 70% of managers reported having no formal training on leading a hybrid team.
Investing in employee engagement is good for business. According to Deloitte, organizations with engaged employees outperform others – their people are 57% more effective compared to teams with low engagement levels.
Gallup insights on the benefits of employee engagement mirror these findings: highly engaged teams showed an 18% higher productivity (sales) and 23% higher profitability compared to their low-engaged counterparts.
Several factors affect employee engagement. According to Gallup, knowing what is expected of you as an employee is the top driver of engagement. Gallup’s meta-analysis involved 112,312 teams and business units and found strong relationships between role clarity and important outcomes like productivity, employee retention, safety, customer engagement and employee wellbeing.
Unfortunately, role clarity has been on the decline since 2020 and employees are more confused about what’s expected of them than ever. This is especially pronounced in the case of remote and hybrid workers. Less than half of remote workers strongly agreed that they know what is expected of them.
Having a sense of purpose at work is another factor that impacts employee engagement. But a “stark purpose gap” exists between upper management and frontline employees, revealed McKinsey. 85% of executives agree that they can live their purpose at work, whereas 85% of frontline workers and managers are unsure about that or disagree. Interesting, isn’t it?
There are also gaps to bridge when it comes to employee wellness programs. Only 65% of workers feel that their organization does enough to support their health and wellbeing at work, according to PeopleInsight. Since research shows well-being has a huge impact on employee engagement, this statistic is eye-opening.
Also, professional development can help keep employees engaged. The majority of respondents in an Axonify survey (92%) said that the right kind of workplace training impacts their level of engagement positively.
Finally, don't underestimate the power of employee recognition for driving engagement. According to HBR, employees whose managers were great at recognizing them were 40% more engaged than those with managers who didn’t show the same level of recognition.
(PS A platform like Applauz can help you build a comprehensive employee recognition program to leverage these insights).
Effective internal communication is one of the key drivers of employee engagement. Unfortunately, poor internal communication is rampant – and it’s one of the top sources of employee frustration and decreased productivity.
Grammarly’s “The State of Business Communication” report revealed that half of workers report that poor communication has increased their overall stress levels.
Shockingly, 22% of them have even considered finding a new job because of it.
Moreover, according to another Grammarly report, poor communication costs US companies an estimated $1.2 trillion yearly.
If you’re debating whether remote and hybrid work is still a good idea, know that flexible work arrangements can increase employee engagement and performance.
For example, Nicholas Bloom, cofounder of travel website Ctrip, told HBR that team members working from home were 13.5% more productive than in-office workers. That’s nearly a whole extra work day each week.
A whopping 96% of workers surveyed by FlexJobs shared that remote or hybrid work would best support their mental health. Needless to say, being mentally healthy is good for morale – and engagement.
Interestingly, hybrid employees are 1.7 times more likely to be fully engaged than in-person employees and 1.9 times more likely to be fully engaged than remote ones, showed an ADP Research Institute survey.
You should also be paying attention to younger employees, as they are the most likely to get disengaged.
Gallup insights revealed that post-pandemic engagement levels are on the decline for younger workers. This is most pronounced with older millennials born between 1980 and 1988, who have seen their engagement levels plummet.
The percentage of engaged workers in that age group has declined by seven points while the percentage of their actively disengaged counterparts has increased by five points.
As for younger millennials (born in 1989 or later) and Gen Zers, they have experienced a five-point decline in engagement and a one-point increase in active disengagement.
So, how do you engage younger workers? Make sure you offer millennials professional development opportunities. According to a PwC report, over half of millennials believe that career progression is the most important aspect of a job.
When it comes to Gen Z, empathy is key. Deloitte research revealed that Gen Zers ranked empathy as the second most important trait in a boss, so don't underestimate the impact of empathy on business outcomes.
Technology can also have an impact on engagement, whether you leverage employee engagement tools like Applauz or whether you use tech to enhance productivity.
For example, 77% of workers who primarily use a project management tool to communicate with other team members say it leads to improved internal communication, according to Project.co. As mentioned above, internal communications are pivotal to employee engagement, so this data point matters.
Also, you can likely do better in terms of tracking and measuring employee engagement. Only 16% of HR leaders surveyed by Gartner reported feeling satisfied or very satisfied with their current approach to measuring the employee experience.
Strengthening company culture is a no-brainer in terms of improving employee engagement. Companies with strong cultures focused on employee engagement and shared purpose have an edge.
For example, Deloitte research revealed that mission-driven organizations enjoy up to 30% higher innovation rates and 40% greater employee engagement, which not only helps them stand out but also sustains company growth.
Company culture also matters in terms of attracting engaged employees who will have a positive ripple effect on other team members. 77% of job seekers consider culture more important than salary when choosing where to apply, according to FlexJobs.
Burnout is rampant – 28% of U.S. employees always or very often feel burned out, according to Gallup.
The same Gallup report shows that burnout can cost organizations 15% to 20% of total payroll in voluntary turnover costs.
It makes sense: Employees who are burned out are nearly three times more likely to be actively looking for new opportunities, according to the Society for Human Resource Management (SHRM).
Work-life balance is important to combat burnout, but so is connection. Employees who have a strong sense of belonging are less likely to experience burnout, according to meQuilibrium.
Extreme burnout risk affects more than 17% of workers with the weakest sense of belonging, but only 6.9% of those who have a strong sense of belonging at work.
Disengaged employees are more likely to leave. Teams with low engagement levels experience turnover rates that are 18% to 43% higher than their highly engaged counterparts, according to Gallup.
In fact, more than half the world's employees were watching for or actively seeking a new job in the latest Gallup State of the Global Workplace report.
Another Gallup meta-analysis, which compared the most highly engaged teams with the least engaged ones, also revealed that employee engagement can decrease employee absenteeism by 81%.
As a manager, you play a pivotal role in shaping employee engagement. Gallup insights revealed that 70% of the variance in a team's engagement is related to management.
As Gallup puts it, “the manager is either an engagement-creating coach or an engagement-destroying boss, but both relationships affect employee behavior.” Which one would you want to be?
Managers are also important drivers of employee recognition, which has been shown to increase engagement when done effectively. However, they may not recognize employees often enough. According to Zippia, nearly 30% of workers haven’t received recognition for strong work in over a year, if at all.
This may be because only 22% of managers report feeling equipped to understand how to acknowledge employees, according to PossibleWorks.
Employee appreciation matters, but so does feedback in general. People want to know where they stand and how to improve. In fact, it motivates them: Zippia revealed that 85% of employees take more initiative when they receive feedback in the workplace.
Diversity, Equity and Inclusion (DEI) is more than just a buzzword. It’s an important piece of the employee engagement puzzle.
Diverse and inclusive organizations generally have a better employee experience, which leads to higher engagement, more innovation and improved business outcomes. On the other hand, bad DEI practices can lead to disengaged employees.
According to ADP, diverse and inclusive teams work 12% more, have team members that are 19% more likely to stick around long-term, and collaborate 57% more effectively.
Better team synergy combined with different perspectives leads to more innovation. Research from the Boston Consulting Group showed that companies that have more diversity in their leadership teams earned nearly half of their revenue from innovative solutions – 20 percentage points more than companies with leadership teams that are less diverse than average.
While job satisfaction is a component of engagement, the two concepts shouldn’t be confused.
As Gallup notes, positive feelings are usually byproducts of engagement, but if you’re looking to improve employee engagement, you should put an emphasis on elements that engage workers and drive results. That means clear expectations, the opportunity to leverage their zone of genius, and the space to make decisions, feel valued and grow.
That said, workplaces with high employee satisfaction levels tend to have good things going on the engagement front too.
For example, the right rewards and incentives can boost both engagement and contentment levels. So, do you know what your team members value the most? You might be surprised by the nuances and different preferences involved.
For instance, 37% of respondents in a SelectSoftwareReviews survey said they were happy to ditch a $40,000 bonus in favour of guaranteed remote work for life.
About two-thirds of workers said they want to be paid for their time, but the rest would like to be compensated based on the success of their efforts.
Every team is different, but these types of insights can help you offer effective employee incentives.
The Business Case for Employee EngagementThe numbers don’t lie: Employee engagement increases productivity. It's more than a nice-to-have in order to boost morale.
It’s a science-backed, proven driver of business success. Research consistently shows that companies with engaged workforces reap rewards such as better employee retention, productivity and profitability.
Having highly engaged employees won’t just lead to more profit – it also helps you stand out from your competitors and attract top talent.
By creating environments where people can thrive physically, mentally, emotionally and socially, you create the right conditions for collaboration, commitment and success.
The evidence is clear: engagement isn’t an expense to slash – it’s an investment in your future. For more resources and tools to improve employee engagement, check out Applauz.
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