What is low employee engagement costing your business?

21st June by Lee Robertson

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Recent statistics published in Gallup’s State of the Global Workplace: 2024 Report reveal a concerning trend among UK employees, with 90% reportedly disengaged and either quietly or actively quitting because they are psychologically unattached to their work and company. This widespread disengagement poses a significant threat to productivity, performance and profitability across British businesses.

The productivity plunge

Disengagement among employees has a direct impact on productivity. With a staggering majority of the workforce lacking motivation, the cumulative effect on business operations can be severe. Disengaged workers tend to show minimal effort, leading to slower project completions, missed deadlines and a general decline in work quality.

“Productivity is the lifeblood of any business,” said Karen Smart, head of consultancy at the AoEC. “When 90% of employees are disengaged, the overall output plummets, making it challenging for organisations to stay competitive. Delays in product development, reduced service quality and a damaged brand reputation are just the tip of the iceberg.”

Performance pitfalls

The detrimental effects of low engagement extend to employee performance. Workers with high engagement are typically more creative, innovative and proactive in problem solving. They contribute positively to the organisation’s success by finding effective solutions and showing initiative.

Conversely, disengaged workers are more prone to errors and lack the drive for creative thinking. “Performance issues which are down to disengagement are not isolated incidents,” added Smart. “They ripple through entire teams, leading to widespread inefficiency.”

Profitability pressures

The monetary impact of low engagement is substantial. Gallup’s findings also highlight that employee disengagement is costing the UK economy an eye popping £257 billion annually, which equates to how much it costs to run the NHS for a year. High turnover rates, increased absenteeism and the associated overheads of recruitment and training strain company resources.

The human cost: stress, anger and sadness

The Gallup report also tells us that the wellbeing of British workers is in jeopardy with 40% reporting experiencing daily stress, 20% reporting daily anger and 27% feeling sadness every day – the second highest rate in Europe.

These statistics paint a dismal picture of the emotional state of UK employees. With high levels of stress, anger and sadness, the human cost of disengagement is considerable. These negative emotions can contribute to a toxic work environment and further diminish engagement rates.

High stress and emotional turmoil can result in increased sick leave and reduced overall wellbeing and resilience. When employees are unhappy or unwell, their ability to perform well is compromised and creates a vicious cycle of disengagement declining productivity.

Coaching – a path to re-engagement

Experts suggest that adopting a coaching style of leadership could be a potential solution to this crisis. Managers acting as coaches, rather than traditional command-and-control bosses, can focus on developing employees’ strengths, providing regular feedback and supporting their professional growth.

“Coaching promotes belonging, encourages open communication and makes employees feel valued and heard,” explained Smart. “This can significantly reduce the feelings of sadness, anger and stress we see stated in Gallup’s report. When employees are exposed to positive and supportive working cultures, see that their contributions matter and that their personal development is prioritised, they are far more likely to become engaged and committed to their roles.”

Globally the situation is not much better, with overall employee engagement holding steady at 23%. However, the high levels of disengagement presented in Gallup’s State of the Global Workplace: 2024 Report show a significant need for British businesses to take sustainable action if they are to stop the drain on productivity, performance and profits.