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GuidesSurveysWhat is employee engagement, and how do you measure it?

What is employee engagement, and how do you measure it?

Last updated

9 March 2023

Reviewed by

Tanya Williams

Engaged employees can change businesses. They lead to better performance, faster processes, less turnover, and even increased profits. 

The problem is, much of the workforce is disengaged. Globally, just 21% of employees are engaged at work, and only 33% are thriving in overall well-being.

So, what exactly is employee engagement, how can you measure it using tools like surveys, and how can you improve it across organizations? 

Let’s take a look at the key factors. 

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What is employee engagement?

Employee engagement typically comes down to two main attributes: Enthusiasm and involvement. 

It’s essentially how committed employees are to an organization and how inspired they are to apply themselves, work as a team, and solve problems.

Employee engagement is a powerful indication of workplace culture and turnover for workers. 

Employee satisfaction vs. employee engagement

While people often confuse the terms, employee satisfaction and employee engagement are subtly different.  

Employee satisfaction measures how much a person likes their job and derives satisfaction from it. Engagement refers to how much an employee applies themself to the role. 

While the two terms can go hand in hand, they don’t always. For example, someone could be very satisfied with their job, but they may not go above and beyond to solve problems. They may come to work late and work unproductively even if they enjoy their role. 

In the same way, someone could apply themselves and work very hard, but that may not necessarily mean they’re satisfied with their job. 

Ideally, employees will experience both satisfaction and engagement.  

Why is employee engagement important?

Employees are the backbone of any business. They’re the reason a business runs smoothly, efficiently, and profitably––or not. 

Individual team members are behind everyday business decisions, making their commitment and motivation critical to the organization. 

Disengaged employees cause big losses for businesses. According to a US survey by The Conference Board, low employee engagement costs businesses $450–550 billion annually. 

On the other hand, engaged employees can give profits a major boost. Researchers at Gallup found that companies with engaged employees performed with 21% higher productivity and had a 22% increase in profitability. 

It’s not just profits that get a boost when organizations have more engaged employees. Gallup research also demonstrated decreases in: 

  • Absenteeism

  • Employee turnover

  • Accidents

  • Quality defects

  • Theft 

The upshot appears to be that engaged employees can lead to better-performing, more stable businesses. Workforce engagement is a critical parameter for business success. 

What drives employee engagement? 

The main driver for employee engagement may come as a surprise. While HR departments play an essential role, the onus appears to be on leaders and managers. 

How managers impact employee engagement

Managers play the most prominent role in employee engagement. 

Gallup research found that an employee’s manager or team leader accounts for 70% of the difference in team engagement. Suffice it to say, whether or not a person clicks with and feels valued by their manager matters a lot. 

The research also found that employee feedback in the form of support, clear communication, and linking their work to the company's success is vital.

Employees who regularly receive feedback from their manager are three times more likely to be engaged than those who receive feedback only once per year or less. 

We cannot overstate the importance of leaders and managers coaching, supporting, and empathizing with their team members. 

How HR impacts employee engagement

Still, we shouldn’t overlook human resources’ impact on employee engagement. HR provides a vital link for people to raise issues, reach out for support, and speak to a neutral party.

The HR team also has the opportunity to train leaders, managers, and team members to act in ways that make teams feel valued and respected. 

HR teams can also run surveys to discover how employees feel about their work and assess levels of engagement. They can also help the organization adopt beneficial practices and implement strategies. 

Measuring employee engagement

Businesses should not overlook the importance of employee engagement. Every business, large or small, will benefit from measuring this fundamental metric. 

When determining the level of engagement, it’s helpful to follow these best practice steps. 

Key levels of employee engagement

Before measuring employee engagement, it’s helpful to be clear on the different levels of engagement. Typically engagement falls into three main categories. These are: 

Actively engaged employees

Employees who are actively engaged tend to be motivated, enthusiastic, and productive. They’re dedicated to doing their best work and contributing to the company's mission.

They tend to have characteristics such as: 

  • Taking the initiative to solve problems that arise without being asked

  • Coming up with solutions and better ways of working to keep efficiency high 

  • Taking on more than their minimum workload 

  • Promoting the company’s mission and vision 

  • Putting their hand up in times of stress and challenge 

These types of employees are incredibly valuable for businesses as they drive efficiency, boost profits, and keep the company’s competitive edge.

Disengaged employees

Employees who aren't engaged tend to feel neutral about their role within a company. They’ll likely still fulfill their expected tasks but won’t go above and beyond to deliver the best results. 

Disengaged employees are unlikely to go above and beyond in times of stress or challenge or be proactive in developing better working methods. 

They tend to have characteristics such as: 

  • Being fine with the status quo

  • Not wanting to do more than their expected role responsibilities 

  • The potential to ignore problems to avoid overworking on solutions 

  • A refusal to put their hands up to solve significant challenges 

Actively disengaged

The third level is actively disengaged workers. These workers are beyond being neutral about their role; they are also likely to be negative about their job and the company they work for. 

They tend to have characteristics such as: 

  • Negative attitudes toward the organization

  • A preference not to fulfill their expected tasks 

  • Doing the bare minimum to get by 

  • Being opposed to changes, improvements, or solutions 

  • Being vocal about their disinterest in their job or the company 

Actively disengaged employees have the potential to do real harm to the company’s reputation. They may express their negativity to other staff members or customers, possibly tarnishing the business name. 

Survey your employees, but do it right

Surveys are a helpful tool to discover whether your employees are actively engaged, not engaged, or actively disengaged. 

However, your organization must act on the results, or a survey is a waste of time. Worse still, your employees may feel frustrated after answering survey questions for no actions or improvements. 

For your survey to impact employee engagement, craft it well. Start with considered goals, use relevant questions, continually learn, and act on results. 

Start with the end in mind

For relevant results, set out pivotal parameters for success. It’s important to be clear about who will act on the results and how. 

Some useful questions to ask at the outset include:

  • What are our goals with this survey?

  • Who will create the survey? 

  • Who will measure the results? 

  • How will we communicate these results to the wider business? 

  • What actions can we take to address employee disengagement? 

  • How can we communicate these actions to employees? 

Set out a list of questions

Asking the right questions is essential to getting the information you need. This will ensure you really understand how employees feel about their work and how engaged they feel in their roles. 

Some relevant questions might include: 

  • Do you enjoy your job? 

  • Are you proud to work for [company]?

  • How often do you consider looking for an alternate job?

  • How supported are you by your manager? 

  • Is your manager a good role model? 

  • How likely are you to be working here in two years?

  • How often do you feel comfortable coming up with new ideas? 

  • Do you have the resources you need to do your job effectively? 

Encourage participation in the survey

The more employees who complete your survey, the better. If certain employees or departments don’t complete the questions, your results may be skewed and misrepresent engagement across the business. 

To get enough results, make employees aware of the survey through email, text message, or physical meetings. 

Ensure that employees understand that answering the questions is a chance to make their voices heard. Be clear that you intend to take action based on overall feedback. 

It is common practice for these surveys to be anonymous. Inform employees that their answers will be anonymous, so they can give genuine answers without fear of offending or repercussions. 

Encourage employees to block out time in the workday to complete it. If they have to complete the survey during their lunch break, they’ll rush it, and you’ll get low-quality responses.  

Act on results

Once the results come through, collate them into meaningful insights to share across departments and the broader company. 

Then, act on those results. 

Some actions might include:

  • Coaching leaders to lead with more empathy, encouragement, and motivation 

  • Offering increased benefits to help employees feel more valued at work: Flexible hours, mental health benefits, or remote work options

  • Offering a retreat to bring employees together in a fun, engaging way

  • Holding one-on-one sessions with managers to help workers feel more connected and heard in the workplace 

Continually learn

Asking employees how they feel is great—but it’s crucial to keep asking for feedback. 

Holding surveys at least once per year is helpful to gain feedback continually and make improvements. Never assume engagement is a static parameter; it’s likely changing constantly. 

Improve employee engagement

Focus on the critical aspects of employee engagement to enhance it:

Start with leadership

As we’ve seen, leaders play a critical role in employee engagement. Leaders can ensure employees feel valued in their roles, know what’s expected of them, and can raise their hands to highlight issues or come up with solutions. 

Training your leaders to be clear on how they treat their employees will breed a sense of support throughout the company. 

One way leaders can determine team member engagement is if employees agree with statements such as: 

  • I know what’s expected of me

  • I can confidently share my views 

  • I feel valued at work

  • I feel as though my manager cares about my well-being 

  • I feel as though I have enough time to complete my tasks 

  • I’m treated as a person, not just another number 

  • I understand the company’s mission, and I know I’m helping to bring it to life 

Managers can work with their teams to ensure those statements are true for their team members. 

Some ways to help employees feel supported include: 

  • Frequent recognition for completed tasks 

  • Acknowledgment of skills and strengths 

  • Feedback that’s constructive, not critical 

  • An open space to share ideas 

  • Inclusion in all activities 

Help employees thrive with training

While challenges are a normal part of any role, employees should have confidence in their work. No one wants to feel as though they can’t do their job. 

One way to ensure they’re self-assured is through relevant training, which can build skills and certainty within the team. This might mean on-the-job training or away days to upskill and boost confidence. 

Get the right role fit

Some roles aren’t a good fit for certain people. For example, an introvert might not thrive in a fast-paced sales position, while someone who loves speaking to people might struggle in a quiet corner office. 

Understanding your team's skills, preferences, and natural personality can help when considering role changes. Have regular discussions with team members to ensure they’re thriving. 

Reputable personality and workplace assessments, such as the Myers-Briggs Type Indicator®, can help you uncover and celebrate team members' strengths. 

Consider the employee’s trajectory

It’s not just the company that’s on a mission—most employees are too. Typically, people want to feel like they’re on a positive career path with room for growth.

Considering how your employees can grow into new roles and advance in their careers keeps engagement and enthusiasm high. Make sure these discussions are genuine, though, not empty promises. 

The impacts of highly engaged employees

Improving employee engagement can positively impact the company. 

Engaged employees don’t just boost profits; they increase safety, reduce challenges, and keep productivity high. 

Higher employee retention

Retaining employees is a big deal, as high employee turnover causes huge costs to companies. Hiring, onboarding, and training all take time and money, so encouraging experienced employees to stay in their roles can be highly beneficial across the board. 

Lower absenteeism

Employees who are more engaged at work are less likely to take time off. In fact, statistics have shown that absenteeism reduces by a whopping 81% with engaged employees. 

Better safety

Increased safety is also strongly linked to employee engagement. An engaged workforce appears to reduce safety incidents and accidents by an average of 64%

Increased customer loyalty

Engagement even impacts customers and their loyalty to a brand. A small but significant 10% increase in customer loyalty appears to occur due to more engaged employees. 

Engaged employees for business success

Enthusiastic, committed, and motivated employees are critical for business success. Still, keeping employees engaged can be challenging. 

Globally, workplace engagement is low. And while many companies may run surveys to measure engagement, they don’t always act effectively on those results. 

Using best practice surveys, continual learning, and active improvements can boost employee engagement, resulting in a raft of benefits across a company. 

Committing to better employee engagement could be the difference between thriving in a competitive landscape or merely surviving. 

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