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Global Employee Engagement Is Down: What To Do About It


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May 16, 2017 | by Don MacPherson


It’s rough to be an employee right now and even harder for the employer. We just surveyed more than 1,000 companies around the globe and the results – not great. Sixty-three percent of people are engaged at work, down from 65%, according to Aon’s 2017 Trends in Global Employee Engagement report, which measures employee advocacy, commitment, and desire to bring one’s best to work. This marks the first time since 2012 that engagement has regressed.

Highly engaged employees, those people in the organization who are most dedicated and bring their best to work every day, fell to just under a quarter of all global employees. The actively disengaged population, those who are most cynical about the workplace and are more likely to contribute to absenteeism, poor performance, workplace safety issues, and even cyber security breaches, rose by one point to 15 percent of employees.

While the drop to the top two engagement categories might not seem noteworthy, given there are millions of responses in the database being analyzed, it is most certainly significant. To add to the significance, this drop also marks the first time since 2012 that engagement has fallen. As the global economy recovered from the last recession and expanded, engagement has continually grown until now.

 

The biggest drop occurred in Asia (down 3 pts.), while Europe and North America (-1 pt.) also experienced declines. Both Africa (+2 pts.) and Latin America (+3 pts.) saw engagement improve.

While falling engagement is big news, the real story is why it’s falling and what organizations and leaders need to do about it.

Growing Insecurity

The rise in populism and rapid technology advancement are beginning to challenge the way we feel about our organizations. Populism is not new, but it certainly reached another level with the United Kingdom’s decision to leave the European Union through the Brexit vote in June of 2016, Donald Trump’s victory in the United States presidential race in November of 2016, and expanding populist sentiment in various countries around the world.

These movements are audible cries that huge segments of these countries’ populations are dissatisfied with the economic rules of the game. Too few are benefiting at the cost of too many and the only viable solution seems to rise up and advocate for changes to those rules.

At the same time, there is the growing fear of obsolescence. For years, blue collar workers were concerned that their jobs would be replaced by new innovations. However, rapidly advancing technologies like Artificial Intelligence, drones, natural language processing, virtual reality, and 3D printing are ready to replace both blue and white collar jobs creating a level of anxiety not seen since the Great Recession.

Much of the populist sentiment is a result of the threat of new technologies and how they will change the work landscape. This is supported by a five-point global decline in employee perceptions about future opportunities at their organizations. Excitement for the future is waning.

Engagement Opportunities

Populism and rapid technology advancement are part of the “why” employee engagement has dropped. The “what” leaders need to do about it is another story. We found the top five engagement opportunities fly in the face of conventional wisdom.

Rarely is pay a top opportunity to drive engagement, but this year we see it as the #1 global opportunity. The Rewards & Recognition dimension only dropped a single point across all employee, but in Asia, where engagement has fallen the most, it dropped by two points.

This isn’t just an issue of employees wanting to make more money, though many would say that would help. As we analyzed the data, we found that it is actually “pay fairness” that is the strongest item level driver of engagement. Transparency is often a rallying cry in a populist zeitgeist and pay fairness is likely an outcome of many employees feeling great inequity when it comes to their contributions compared to their pay checks.

The other remarkable story in the list of engagement opportunities is the prominence of senior leadership - and the absence of the direct manager. For nearly two decades, engagement experts have cited that the manager is the linchpin to the employee engagement equation. Our research indicates this is changing. Yes, it is great to hear from our managers, but in times of great social and economic uncertainty, employees want to hear stabilizing messages from the highest levels of the organization.

As the top five engagement opportunities are considered, four of the five are largely dependent on senior leadership decisions. Direct managers can influence Rewards, Employee Value Proposition, and Enabling Infrastructure, but they will not have nearly the influence that senior leaders do on these dimensions. To truly drive engagement, managers will have to focus on Recognition and Career Development.

Engagement and the Year Ahead

We predict that perceptions of the workplace will continue to decline through 2017 and based on early indications in our data, it is trending that way. Regardless of how the data will trend globally, business leaders know it is their organization that matters. They know that if they focus on driving engagement in their organization, they will have significant advantages against the competition.

To access the entire 2017 Trends in Global Employee Engagement report, go to www.aon.com/engagement17. To learn more about Aon’s employee engagement research capabilities, go to www.aon.com/employeeengagement.

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