While organizations throughout the world are seeing employee engagement stubbornly flat, modest gains are evident in employee enablement. However, a significant gap still exists in both areas from levels achieved by high performing companies.

This was one of the key conclusions from our 2013 Hay Group study, which examined engagement and enablement levels in organizations spanning all regions of the world, drawing on the opinions of over six million employees. >>

employee engagement and

enablement trends

2013 global

©2013 Hay Group. All rights reserved

©2013 Hay Group. All rights reserved

2013 global employee engagement and enablement trends

Our findings also revealed that 43 percent of employees do not feel motivated by their organizations to contribute more than what is required in their jobs, and 38 percent continue to voice concerns that working conditions are not allowing them to be as productive as they can be.

North America leading the pack on engagementOn a regional level, organizations in North America are outpacing other geographies, with engagement levels averaging 72 percent, up from 69 percent in 2012. Companies in the United States have seen engagement levels rise to 73 percent, up from 70 percent in 2012. Employees in the U.S. are feeling greater pride in working for their organizations (+4 percentage points) and are increasingly willing to recommend their organizations to friends and family as places to work (+6). While engagement levels in Canada are unchanged from 2012 (69 percent), they are also above the global average.

Engagement rising in Europe, but still below global average Engagement levels in Europe have risen to 66 percent, pulling even with the global average. While Poland (62 percent), the Czech Republic (63 percent), and the UK (65 percent) all remain below the global average, gains are evident in each of these countries except the Czech Republic. France continues to face the greatest threat from employee disengagement, with engagement levels falling to 61 percent. Worryingly, 52 percent of French employees do not feel motivated by their organizations to give discretionary effort, with a similar percentage looking to leave their current employers within the next five years.

Austria (76 percent), Spain (72 percent), the Netherlands (71 percent), Belgium (69 percent), Italy (69 percent), Germany (68 percent), and Russia (66 percent) are all at or above global standards. Workers in Austria report that their organizations are doing an excellent job of motivating them to contribute more than what is required (68 percent). Organizational pride has risen in Spain to its highest point in the last five years (85 percent).

Mixed picture in Asia PacificCompanies in the Asia Pacific region saw engagement rise to 64 percent on average, an increase over 63 percent in 2012. But, at a country level, results were variable. Engagement in India reversed a 2012 decline, with a five point increase to 73 percent. Australia (66 percent) also fared positively with a three percentage point gain, with engagement now on par with the global average. Japan also evidenced a three point rise in engagement over the last twelve months to 62 percent.

Elsewhere in Asia, the picture was less favorable. Employee engagement in Singapore is unchanged at 62 percent, while engagement in Hong Kong has remained stuck at 61 percent for the last three years. Within China, engagement levels fell one percentage point and are now similarly at 61 percent. Perhaps due to the opportunities a competitive labor market has created for skilled employees, fully 57% of employees in China plan to leave their current organizations in the next five years.

Latin America engagement levels decline, but remain above global averageCompanies in Latin America saw engagement decline to 71 percent, but engagement levels still remain above the global average. Brazil saw engagement fall by two percentage points to 70 percent, with employees indicating they are less motivated by their companies to contribute beyond what is required (-6).

The findings revealed that, on average, 66 percent of workers globally are engaged – on par with 2012, but still significantly below engagement levels in high performing companies (73 percent).

Middle East and Africa enjoys rising engagementThe largest regional improvement was in the Middle East and Africa, where engagement rose by four percentage points to an average of 68 percent. The United Arab Emirates (UAE) presented the brightest picture at a country level, with engagement levels rising by five percentage points (to 74 percent). Among employees in the UAE, five-year highs were established in both pride in working for their organizations and the extent to which employees are motivated by their organizations to work beyond formal job responsibilities (67 percent).

Enablement risingOur data also revealed that despite the continued economic uncertainty, organizations are beginning to create more enabling environments for workers, signalling that as organizations have re-structured and re-focused, employees are feeling better positioned for success, even amid resource constraints.

All regions have seen rises in levels of employee enablement, with the exception of Latin America (which nonetheless remains above the global average). Employees in Brazil are voicing the loudest and most critical concerns, with 47 percent of employees stating there are significant barriers at work to doing their jobs well (six percentage points more than in 2012).

Organizations in Austria are the global pace-setters, with enablement levels rising to 77 percent. Other countries leading the way with significant increases include the UAE (+4) and Germany, the Netherlands, Singapore, and the U.S. (all +3).

Company loyalty a continued concernDespite some modest rises in employee engagement and enablement, two-fifths of the global workforce still intends to change employers within five years. Another recent study by Hay Group, in partnership with the Centre for Economics and Business Research (Cebr), revealed that workers around the

world are already starting to seek new job opportunities, as economic growth begins to return and labor markets begin to pick up.

In 2018, it is predicted that 49 million more employees will be heading out the door compared to 2012 – a total of 192 million employees worldwide. The global employee turnover rate will see the sharpest increase in 2014. But regional economic and job market forecasts show that turnover will spike at different times in different geographies. Emerging economies in Asia and Latin America will spike between now and 2014, while mature markets will peak between 2014 and 2018, led by dominant economies such as Germany and the U.S.

Organizations therefore must start thinking now about how to secure the long-term commitment of their workers. Failure to create the right working environments will encourage disgruntled employees to take off in search of better conditions.

Time to actWhile positive news exists for organizations, in regard to levels of employee engagement and enablement, a significant gap still exists against levels achieved by high performing companies. Leaders in high performing companies realize that employee engagement, along with the creation of supportive working environments, is critical not only in good times but all the more so in challenging times when organizations need to dig deep and call on the reservoir of goodwill of motivated employees.

Tips for business leaders to position their organizations for success:Today’s leaders not only need to understand what drives employee engagement and enablement but also how these drivers are affected by transitions and change. Or else, when they can least afford it, they will run the risk of demotivating employees and impeding their performance – or potentially losing their very best talent.

With two-fifths of employees indicating that work conditions don’t support high levels of productivity, leaders need to ensure that the ‘want to’ associated with employee motivation is matched by the ‘can do’ that comes with creating enabling environments that position employees for success.

“”Mark Royal, Senior Principal, Hay Group

©2013 Hay Group. All rights reserved

To read more about employee engagement and enablement, visit our website www.haygroup.com/insight

About Hay Group Insight

Hay Group Insight, Hay Group’s survey research division, is a global leader in employee opinion research. Through customized survey programs focused on organizational objectives, we partner with clients to attract and retain talent, improve operating efficiency, manage change more effectively, and enhance customer loyalty and organizational performance.

Below are some key considerations for responding effectively:

• Enlist the support of managers at all levels: Managers play an important “sense-making” role in times of change, helping employees understand new developments in the organization and their implications for their teams and job responsibilities. It is critical that leaders make sure that managers at all levels are well-aligned with planned directions and understand the importance of reinforcing key messages with their teams. If middle managers and supervisors signal to employees through their words or actions that they lack faith in organizational leaders, employees’ trust will decline rapidly.

• Manage the handoffs: In interdependent environments, the success of individuals and teams often depends on support from co-workers. Unfortunately, as work routines and processes are evolving amid change, employees may be uncertain where to go for resources, information, or assistance. That means that managers need to focus on clarifying not only the responsibilities of individuals on their teams but also the key accountabilities of other teams on which employees depend.

• Avoid the trap of routines. Structures and processes facilitate efficient execution of objectives by promoting consistent expectations. But along with the benefits comes a potential trap. Where requirements change, existing ways of working may no longer work. Making the situation more problematic, psychologists tell us that one of the ways we reserve cognitive horsepower for higher order activities is by reducing common tasks to routines that require little conscious thought. That means that important aspects of how work is done may be taken for granted, making it unlikely that they will be evaluated in the context of change. Avoiding this trap requires an intentional examination of assumptions to ensure that they are aligned with present work demands.

• Take a broad perspective on rewards. It’s all too easy for there to be an ultra-focus on short term compensation. In any single year, employees may feel disadvantaged given increased work demands associated with change. The best companies do an effective job of highlighting “career income.” Managers emphasise that while any given year may be challenging, over the longer term (e.g., three to five years) employees will be dealt with fairly. Notably, managers have particular influence over the array of intangible rewards the organization provides. And, in fact, many employees see the most important company rewards as career development opportunities, doing interesting work on important company projects, and a high quality work climate.

• Don’t overlook recognition. For organizations going through transitions that involve cost cutting, we commonly see an increased focus on the importance of recognition. That’s because the benefit/cost ratio of these non-financial rewards is high. Intangible rewards don’t cost an organization much, and their impact is substantial. As Harvard Business School professor Rosabeth Moss Kanter puts it: “Compensation is a right. Recognition is a gift.” The fact that patting employees’ backs may be a more effective form of positive motivation than padding their wallets is good news for companies, especially when budgets are stretched to the limit.

High performing and high potential employees are sometimes described as ‘volunteers’; with ample opportunities elsewhere, they work for particular organizations because they want to rather than because they have to. To keep talent from taking flight as labor market conditions improve, today’s leaders would be wise to adopt this perspective and focus on creating compelling work environments that motivate key employees to stay.

“”Mark Royal, Senior Principal, Hay Group