The $500 Billion Cost of a Disengaged American Workforce

Gallup

Two years ago I stumbled upon a 2013 Gallup survey that argued 70% of the US workforce was “disengaged.” Beyond that stat, a big chunk the group was “actively disengaged” (think “Office Space”-style sabotage). Though I wasn’t shocked by these findings, I was very surprised at how bad it was.

It makes sense. It’s very hard to find people who genuinely like their jobs. Things may be somewhat better in the tech sector for several reasons.

Gallup engagement data

Gallup’s 2014 survey data are slightly better than the 2013 results. In fact, Gallup says that the level of employee engagement is better now than at any time since 2000, when the pollster started conducting this survey. But they’re still not good.

It’s worth pointing out that this is no survey of 1,000 adults at a point in time. It’s based on a sample of more than 80,000 US adults from every state captured over the entire course of the year:

Results for this Gallup poll are based on telephone interviews conducted January to December 2014, on the Gallup U.S. Daily survey, with a random sample of 80,837 adults, aged 18 and older, living in all 50 U.S. states and the District of Columbia.

The following are example questions used in the survey to determine levels of employee engagement:

Gallup engagement questions

As the chart above indicates, Gallup found in 2014 that 31.5% of US employees were “engaged,” while 68.5% were not. Gallup reports that “managers, executives and officers” had the highest levels of engagement in 2014 at 38.4%.

This is probably because these groups are better compensated than others and their compensation may be partly tied to individual and corporate performance. In addition, I would speculate, they’re more emotionally identified with their jobs and roles than lower-level employees.

Gallup engagement data

In accordance with the cultural stereotype, “Millennials are the least engaged group, at 28.9%.”  Gallup says that “Millennials are particularly less likely than other generations to say they ‘have the opportunity to do what they do best’ at work.”

Gallup engagement data

According to Gallup and other sources the cost of unhappy employees is “between $450 and $550 billion in lost productivity each year.” And turnover costs employers between 100% and 300% of the former employee’s base salary. By contrast, companies with engaged employees perform better across the board and generate more income.

Gallup engagement

These findings argue that the biggest problem in the American workplace and perhaps, by extension, the US economy is not efficiency or “productivity” in some conventional sense but employee dissatisfaction — as the root cause of other problems. Much of this stems from a long-standing disregard of employee well-being and satisfaction.

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2 Responses to “The $500 Billion Cost of a Disengaged American Workforce”

  1. Jackie says at

    I wonder if the difference between the millennials and traditionalists is their need for instant gratification? I have a relative who worked up the proverbial ladder to success: delivery boy to VP of international marketing over a 30 year career. 
    I have a former student who is on a new “fast track to management” program; three months and you become a manager….What can be learned about managing people in only three months? I’ve dealt with these “fast track managers”…let’s jsut say there is much to be desired!

  2. Greg Sterling says at

    Culturally there are very different expectations, which may be playing into dissatisfaction and disengagement among younger workers.

  3. 3 Types of Corporate Retreats Your Team Should Consider says at

    […] is only at 32% while employees not engaged or actively disengaged were at a staggering 68%. This disengagement costs the U.S. between $450 and $550 billion dollars each year. Corporate retreats are a way for you and […]

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