Employee engagement stalls, wellbeing dips, hurting productivity globally, report finds

The majority of the world’s employees continue to struggle at work and in life, with direct consequences for organizational productivity.

Global employee engagement stagnated and overall employee wellbeing declined in 2023, according to the latest State of the Global Workplace report from Gallup. Both measures are at or near record lows, and their lack of improvement is notable, because they follow multiple years of steady gains. Gallup estimated that low employee engagement costs the global economy $8.9 trillion, or 9% of global GDP.

“Employee engagement has become increasingly important as the globe has entered uncertain economic times,” said Jim Harter, chief workplace scientist for Gallup. “Our research has shown that engagement has a stronger effect on organizational performance during a tough economy.”

Among the key findings:

• Although not all mental health issues are workplace-related, work is a factor in life evaluations and daily emotions. Addressing employee mental health, in part, requires support for thriving in life and engagement at work.
• The United States and Canada have the third-highest regional percentage of thriving employees at 53%, compared to the global average of 34%. S. and Canadian women experienced higher levels of stress (54%) than their male counterparts (45%).
• Twenty percent of the world’s employees experienced significant loneliness the previous day. Although social isolation and chronic loneliness have a devastating effect on physical and mental health, work itself decreases loneliness. In general, working adults are less lonely than the global average.
• The percentage of younger employees thriving in their overall lives has dropped in the past year. Globally, thriving declined in 2023, from 35% to 34%.

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• Managers are more likely than non-managers to be engaged at work and thriving in life. Nevertheless, managers also are more likely to be stressed, angry, sad and lonely than non-managers.
• When managers are engaged, non-manager employees are more likely to be engaged. Managers drive engagement through goal setting; regular, meaningful feedback’ and accountability.
• The global workplace has changed since the start of the pandemic in 2020. The rise in hybrid work for remote-capable employees has made people management more complicated. When organizations increase the number of employees who are engaged at work, it improves a host of organizational outcomes.

Managers can play a significant role in helping reverse these trends.

“A core habit for effective management is providing weekly meaningful feedback for each person on your team,” Harter said. “Physical distance often translates into psychological distance, so this becomes a critical skill for hybrid and remote work. Our data suggest that most managers don’t have a handle yet on effective hybrid and remote work management. It can be done, but it requires greater levels of intentionality and communication.”