Quick look: Employee engagement is tied to lower turnover, increased sales, and more. Yet only 34% of U.S. workers report they feel engaged. The time is now for SMBs to cut through the noise and focus on these top 6 employee engagement trends to ensure they remain competitive and successful.
Employee engagement, or the “involvement and enthusiasm of employees in their work and workplace,” is fundamental to a business’s success. It can help business leaders understand and manage their staff’s perspective on their roles and the overall company culture when properly measured. Further, high employee engagement is tied to lower turnover, increased sales, better customer service, and more.
However, Gallup reports that only 32% of U.S. employees feel engaged at work and 18% are actively disengaged. Still, a continuously tight labor market and ever-evolving employee demands make it critical that employers tune into the employee engagement trends that can help them best motivate (and ultimately retain) their talent.
6 essential employee engagement trends
Understanding and developing a strategy for employee engagement can take time and effort that some small businesses may not have. Employee engagement is multifaceted, ranging from pre-hire experiences to post-exit communications and everything in between. To help you determine the best initiatives to pay attention to and invest in, below are the six top employee engagement trends in 2023.
1. Comprehensive DEI initiatives
Robust diversity, equity, and inclusion (DEI) policies continue to be a frontrunner when it comes to aspects of the workplace that drive employee engagement.
According to a survey from research firm Aon, which questioned over 1,200 human resources (HR) professionals, organizations with high employee engagement rates often have clear DEI programs that include inclusive definitions of diversity. Specifically, 82% of companies with high employee engagement levels have a clear meaning of DEI versus 65% of low-engagement businesses.
Other notable findings from the survey include:
- A DEI program is a “must-have,” not a “nice to have:” 74% of respondents say their organizations have developed a tailored DEI policy, 84% have identified colleagues who are responsible for leading DEI programs, and 93% receive strong support from leadership for DEI initiatives.
- Organizations with higher employee engagement are more likely to have more comprehensive definitions of DEI: 68% of businesses with high engagement specify that DEI includes six or more categories (i.e., disability status, ethnicity, gender, etc.) versus only 54% of organizations with low engagement.
- Businesses with high engagement more actively measure DEI: Pay equity is reviewed by 69% of highly engaged employers versus 58% of low-engagement organizations, while benefit utilization related to DEI is reviewed by 39% of high-engagement businesses versus just 25% of low-engagement ones.
Whether you need to establish a DEI policy or have one that needs broadening, a professional employer organization (PEO) like ExtensisHR can help with its dedicated HR assistance and access to an intuitive DEI Dashboard tool.
2. A focus on friendships
Workplace friendships are incredibly important.
McKinsey reports that compared to those who felt disconnected at work, employees with a strong feeling of social capital are 1.5 times more likely to feel like they belong, 1.5 times more likely to feel engaged, and twice as likely to have sponsorship at work.
The McKinsey research suggests that organizations assess their social capital against three factors:
- Motivation: Are workers motivated to build and maintain relationships, and does the work environment encourage relationship-building?
- Access: Does the staff have access to the social networks and relationships they seek?
- Ability: Do employees have what they require (i.e., time, resources, and skills) to build and maintain those relationships?
In a technology-driven and predominately remote or hybrid work world, business leaders should encourage their staff to discuss non-work-related topics, host themed and seasonal events (both in-person and virtually), and use modern workplace collaboration tools.
3. Timely feedback and recognition
Employees want to know what they’re doing well and how they could improve and want to hear this feedback frequently.
Gallup found that employees who received daily feedback from their managers were three times as likely to be engaged than those who received it once a year or less. And while it’s not always comfortable to explain to workers where they stand to improve, having these conversations enable them to work toward their career goals effectively.
Recognizing your staff’s accomplishments is just as critical. Gallup explains that doing this can keep employees engaged and motivated to put in maximum effort. Likewise, those who don’t feel appreciated may lose enthusiasm, experience decreased productivity, and become a “quiet quitter.”
4. Clear performance objectives
In addition to wanting to know how they’re doing at their jobs, employees want to know what exactly they are working toward. This is where performance objectives, or specific goals workers are expected to accomplish that aim to contribute to the success of the department and/or company, come into play.
In addition to increased employee engagement and productivity, performance objectives have been shown to:
- Allow workers to understand what’s expected of them
- Enable managers to better observe, document, and coach
- Provide staff with a way to self-measure
- Help workers develop job knowledge and skills
- Provide tangible means of clarification if disagreements about work assignments arise
- Allow for an accurate comparison of “what was done” to “what was expected”
- Enable staff to focus on achieving their deliverables in a way that supports greater business outcomes
Writing performance objectives isn’t always as simple as it seems, and business leaders should research best practices on how to do so and consider using a performance management tool to streamline the process.
5. Well-defined career paths
Studies have shown that nearly three-quarters of employees feel they aren’t reaching their full potential at work due to a lack of learning and development opportunities—and employers are taking notice. According to Gallagher’s 2022 Career Wellbeing report, 41% of organizations support workers developing and pursuing a career path (up 7 points from the previous year).
Anticipating the next step in their career can help employees combat burnout, avoid quiet quitting, and feel more motivated. Business leaders can support their staff’s career growth by developing a learning and development strategy that’s focused and immersive and devoting resources to reskilling and upskilling their workforce.
6. Measure, measure, measure
Employee engagement shouldn’t be guesswork; organizations should track several key metrics to determine their workforce’s engagement.
One popular measure of employee engagement is an employee net promoter score (eNPS). To discover its eNPS, companies should regularly survey their staff and ask them on a scale of 1-10 how likely they are to refer the business to a friend or colleague.
Using the survey results, employees are categorized in three ways:
- Ratings from 0-6 are called detractors
- Ratings from 7-8 are called passives
- Ratings from 9-10 are called promoters
Then, eNPS can be calculated using this formula: eNPS = % Promoters – % Detractors. An eNPS between 10 and 30 is considered good, while a score close to 50 is excellent.
Employers can also survey employers on other topics associated with employee engagement. For example, Gallup has found that the following 12 key survey questions best measure employee engagement:
- I know what is expected of me at work
- I have the materials and equipment I need to do my work right
- At work, I have the opportunity to do what I do best every day
- In the last seven days, I have received recognition or praise for doing good work
- My supervisor, or someone at work, seems to care about me as a person
- There is someone at work who encourages my development
- At work, my opinions seem to count
- The mission or purpose of my company makes me feel my job is important
- My associates or fellow employees are committed to doing quality work
- I have a best friend at work
- In the last six months, someone at work has talked to me about my progress
- This last year, I have had opportunities at work to learn and grow
Effectively and easily encourage employee engagement
Maintaining high employee engagement levels is a catalyst for business success, but with so many moving parts, it can be challenging for small- and medium-sized businesses to keep up. Luckily, a PEO can help these organizations adopt best practices without having to take time away from other vital projects.
ExtensisHR, for example, has a team of dedicated HR Managers who not only stay on the pulse of employee engagement trends on your behalf but can help guide DEI policy creation and expansion and employee survey strategies. Further, ExtensisHR’s DEI Dashboard is a tool that allows business leaders to evaluate real-time data on pay equity, salary trends across both gender and race demographics, employee turnover, promotions, and more.
PEOs can also provide access to learning and development portals featuring immersive and integrated learning and performance management platforms that facilitate performance objectives, feedback, reviews, one-on-one meetings, and employee appreciation.
ExtensisHR’s team of experts is here to help you stay on top of the latest employee engagement trends and make your business the best it can be. Contact us today to get started.