Employee engagement: 14 surprising stats

Engagement & Motivation
January 25, 2017

With employee engagement on the minds of many employers and human capital professionals these days, we’ve taken it upon ourselves to scour hundreds of statistics from various studies and articles to come up with the 14 we find the most surprising.

These statistics concern not only the current state of employee engagement but the cost of low engagement to companies as well as the benefits of high employee engagement.

Current State of Employee Engagement

  • 37% of U.S. accommodation and food services employees say they had or will quit their position in the current 12 month period.¹ (Retail, customer service, and hospitality organizations are designed around high-turnover: jobs are relatively easy to learn and new employees can be integrated fairly quickly. But, this strategy doesn’t eliminate the cost of “cycling through” staff.)
  • 49,5% of U.S. employees are “not engaged” at work. (Worldwide, the percentage of engaged employees drops dramatically to 13%)
  • 35% of the U.S. workforce said they’d look for a new job if they don’t receive a pay raise in the next year. ² (In U.S. tech-powered companies, 65% of employees are confident they can find another job if their salary expectations aren’t met.)
  • 52% of the workforce is open to a new job opportunity.

The Cost of Low Employee Engagement to Companies

  • 150% of a mid-level employee’s annual salary can go into finding and hiring their replacement. (400% for high-level or highly specialized employees. Those expenses cover advertising the vacant position, interviewing applicants, screening candidates, hiring, training...) ³
  • 2 years is the average time it takes for a new employee to reach the productivity level of the person they replaced. (The onboarding process also costs the company; training, distraction for managers whose time for coaching and developing existing staff is removed.)

Employee turnover resulting from low engagement has other hidden costs: the process of training new hires can be a distraction for the current staff and, if turnover happens frequently, can ultimately demotivate those employees tasked with back-filling while the new hires come up to speed. This can have even more insidious effects with customers. Turnover amongst customer-facing staff can give the appearance of instability within the organization and ultimately can hurt customers’ confidence.

The Benefits of High Employee Engagement

  • 80% of most organizations’ market value comes from intangible assets such as brand, quality of the workforce; its talent, passion, and commitment (A few decades ago, this value was almost exclusively based on tangible assets like machinery, products, and facilities.)
  • $2,400 is the average increase in profit per employee per year a company can reach with employee engagement programs.
  • 97% of the companies with good employee engagement levels (half or more highly engaged employees) report that engagement leads to greater productivity. 93% say that it plays a major role in the company’s capacity to meet its revenue goals. Overall, 82% of these companies report that high employee retention improves customer loyalty, which provides with a noticeable competitive advantage.
  • 33% report a significant impact of engagement on profit margins, and 81% on revenue growth.

Interestingly, highly engaged employees have both a positive impact on customer experience and, as a result, customer loyalty. A long-term study at Sears reveals customers who had a pleasant, pro-active or superior service experience are 10% to 30% more loyal than customers who have did not and would strongly consider purchasing again from a brand if they had a good customer experience.

Regardless of the statistic, it’s clear that employers and human capital professionals are preoccupied with employee engagement for very good reason.

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Aaron Carr