In New Workplace, U.S. Employee Engagement Stagnates

In 2023, employees in the U.S. continued to feel more detached from their employers, with less clear expectations, lower levels of satisfaction with their organization, and less connection to its mission or purpose, than they did four years ago. They are also less likely to feel someone at work cares about them as a person.

These are among the findings of Gallup’s most recent survey of U.S. employee engagement, which stagnated for the second half of 2023 following a slight improvement earlier in the year.

At midyear, 34% of U.S. full- and part-time employees were engaged in their work and workplace. For the full year of 2023, 33% were engaged, reflecting a slight recent decline. This figure lags behind the annual high -- since Gallup began reporting U.S. employee engagement in 2000 -- of 36% in 2020 and a peak of 40% in late June of the same year. The engagement peak occurred after a decade of steady growth, followed by two years of decline, beginning in the second half of 2021 when it dropped to a 32% low in 2022.

Each percentage point gain or drop in engagement represents approximately 1.6 million full- or part-time employees in the U.S. Trends in employee engagement are significant because they are linked to many performance outcomes in organizations. Not engaged or actively disengaged employees account for approximately $1.9 trillion in lost productivity nationally.

As the proportion of hybrid and fully remote workers has essentially stabilized -- with 29% of employees with remote-ready jobs reporting they’re working fully remotely and 52% working a blend of in office and at home -- it is crucial that leaders are equipped to respond to the new-normal workplace.

On a positive note, the percentage of actively disengaged workers has declined from 18% in 2022 to 16% in 2023. Active disengagement -- what we could call “loud quitting” -- reached an all-time low of 13% in 2018 and 2019. In 2023, 50% of employees were not engaged (quiet quitting).

The ratio of engaged to actively disengaged workers in the U.S. is 2.1-to-1 in 2023, up from 1.8-to-1 in 2022. The record high is a ratio of 2.7-to-1, which was recorded in 2019.

Which Engagement Elements Have Changed the Most?

For 2023, knowing what’s expected at work increased since 2022 by three percentage points but has declined since midyear. Having materials and equipment and having the opportunity to do what you do best also increased for the year (two points), but both decreased since midyear. And all of the areas of growth in 2023 are still well behind their peak levels in 2020.

As noted above, compared with 2020, employees still feel more detached from -- and less satisfied with -- their organizations and are less likely to connect to the companies’ mission and purpose or to feel someone cares about them as a person. The latter sentiment is an issue particularly for fully on-site employees whose jobs can be done remotely.

The engagement of workers younger than 35 rose two points in the past year but is still five points behind its peak level of 40% in 2020. Of note, younger workers have improved by seven percentage points in clarity of expectations but still lag by seven points behind 2020 levels. Currently, only 45% clearly know what is expected of them at work. Compared to 2020, younger workers are also trailing behind their highest levels by seven points or more on feeling cared about at work, feeling connected to the mission or purpose of the company, and having opportunities to learn and grow.

Workers aged 35 and older have seen minimal change in the past year but still significantly trail behind the 2020 peak on satisfaction with their company (six points), clarity of expectations (seven points), and opportunity to do what they do best (five points).

The Decline in Role Clarity

The most fundamental engagement element is knowing what is expected of you. Gallup’s meta-analysis across 112,312 teams and business units finds strong linkages between this element and many important organizational outcomes, including productivity, employee retention, safety, customer engagement, and employee wellbeing.

Organizational leaders are at a distinct disadvantage in getting work done and meeting customer needs if expectations are not clear. Gallup’s research finds the vulnerability posed by unclear expectations exists across all types of employees in the new workforce. But that vulnerability is particularly acute among hybrid and fully remote workers who have experienced double the decline in knowing what’s expected of them compared with on-site workers whose jobs could be done remotely.

While workers whose jobs require them to be on-site are more likely to have clear expectations (50%), they too have seen a decline in this measure since 2020 (59%).

Context for Leaders

The decline in clarity of expectations since 2020 could be related to several changes in the U.S. workforce:

• Employee turnover during the great resignation led to restructuring of teams with less familiarity with one another -- 51% of managers tell Gallup that restructuring of teams has been a major complication post-pandemic. Layoffs, budget cuts and staffing challenges have likely contributed to this.
• 64% of managers report that employees now have additional job responsibilities. And many report that customer expectations have changed to demand a more immediate digital experience.
• Importantly, 70% of managers report to Gallup that they have had no formal training in how to lead a hybrid team.

Gallup analysts identified individuals in its database who have declined in clarity of expectations from 2020 to 2023. Among this group, across job types and work locations, the largest areas of decline fit into five themes:

• Feedback and Performance Focus
  • Received meaningful feedback in the last week
  • Performance managed to motivate outstanding performance
  • Manager keeps me informed on what is going on
  • Pride in quality of products/services
  • Freedom to make decisions needed to do my job well
• Goals/Priorities
  • Manager includes me in goal setting
  • Feel prepared to do my job
• Wellbeing
  • Organization cares about my wellbeing
  • Able to maintain a healthy balance between work and personal life
• Team
  • Feel like part of the team
  • Know what my coworkers are expected to do
  • Have partners I can always rely on at work
  • Team takes time to reflect on and discuss what we might do better

Of important note, the largest decline associated with the drop in clear expectations was the extent to which employees perceived that they have had meaningful feedback in the past week.

What constitutes meaningful conversations between managers and employees? Gallup found they include recognition and discussion about collaboration, goals, and priorities, and the employee’s strengths. These conversations prevent employees from feeling disconnected from the organization because managers stay in touch with what each employee contributes and can then articulate how that work affects the larger organization. The conversations ensure that expectations can be adjusted as the business needs change and in what ways those changing expectations interact with coworker roles.

For example, Gallup found that while less than half of employees with jobs that can be done remotely strongly agree that they know what is expected of them, the percentage jumps to 82%, 77%, and 84%, respectively, for fully remote, hybrid, and on-site employees who report that they know what their coworkers are expected to do. This is an example of the ongoing clarification that can come from weekly conversations.

Gallup finds that a manager having one meaningful conversation per week with each team member develops high-performance relationships more than any other leadership activity. Gallup analytics have found managers can be quickly upskilled to have these ongoing strengths-based conversations that bring purpose and clear expectations to work, which is now deteriorating in U.S. organizations.

In this new hybrid and remote workplace, the clarity of what each of us is doing has never been more important. And the role of manager has never been more challenging. Whether they are managing remote or on-site employees, managers need their jobs to be streamlined to fulfill their most important responsibilities, which should be much more heavily weighted toward people management and coaching -- including those weekly conversations -- than filling out administrative forms.