The High Cost of Disengagement

We are so used to pop culture psychology and self-help waves that celebrate everything from diet fads to parenting tips, it might feel like employee engagement is yet another fast-track scam to selling books and services. Disengaged employees, however, have a very real effect on a business’s bottom line.

According to The Economist in their Re-engaging With Engagement report, 87% of senior leaders surveyed believe that disengagement is one of the three biggest threats facing their businesses.

Gallup estimates, in The Gallup Business Journal article, The High Cost of Disengaged Employees, that “actively disengaged employees” – interpreted as employees who are clearly unhappy with their jobs – cost the US economy up to $350 billion dollars per year in productivity.

Disengagement is not just a problem of having a few unhappy employees. It has a real effect on companies and, if not addressed head on, can lead to serious problems within a company.

Negativity is contagious, and disengaged employees impact both co-workers and customers, often causing friction and creating problems at work and with clients. Disengaged employees do not perform the same as engaged employees, and can lower production and company performance as a whole. Moreover, disengaged employees are less likely to stay in a job. The turnover rate is higher, and it is costly for an organization to train new employees. Another problem is losing young talent because new employees don’t connect with the company.

Engagement is a priority in today’s market. A company’s success and projected growth depends on its employees – ones that are passionate about their jobs, feel committed to the organization and put discretionary effort into their work. There are no magic, quick fixes to employee engagement. However, making engagement a priority is a start in identifying global engagement themes as well as localized “at risk” areas within the organization.

The diagnosis is in. Research screams out that companies must work on engagement as an issue. As The Economist reports, “a significant mismatch exists between words and deeds on engagement.” Though 87% of those surveyed believe it to be one of the biggest problems in their company, only 12% regularly address the issue of disengaged staff, while 47% discuss disengaged employees “occasionally” or “rarely.” The irony is, companies now realize it’s a priority but resist taking the steps they need to act on it. Disengagement is real and needs to be addressed. It’s time to talk about the elephant in the room and act on it.