In the ever-evolving landscape of the UK economy, one crucial factor stands out as both a challenge and an opportunity: employee engagement. Rarely a day passes without alarming headlines highlighting the economic challenges and growing discontent among employees in the UK. Reports from leading think tanks continue to underscore declining levels of trust and heightened employee unrest, painting a concerning picture for the future.

The UK has long grappled with the challenge of low productivity growth. Despite being one of the world’s leading economies, productivity levels in the UK have consistently lagged behind those of other G7 countries. The ‘productivity puzzle’ has far-reaching implications, affecting everything from economic growth to living standards and global competitiveness.

So, how does employee engagement factor into this equation? Engaged employees are more likely to contribute innovative ideas, collaborate effectively with colleagues, and deliver high-quality work consistently. They are also more resilient in the face of challenges, demonstrating greater adaptability and problem-solving skills. It is unlikely to be a coincidence that the UK has both poor levels of employee engagement and dormant productivity. As a result, it has never been more vital that we recognise the pivotal role that engaged employees play in driving productivity and fostering economic growth. 

The MacLeod Review showed that the correlation between employee engagement and overall business performance cannot be overstated. However, the issue of how to do engagement in practice has been an ongoing challenge for organisations. For many, it can be a minefield to understand where to start, let alone how to develop and implement engagement initiatives. Regardless of sector or size, for many organisations, employee engagement has been stubbornly elusive.  

The pandemic exacerbated existing challenges and created new ones as organisations struggled to engage with a dispersed workforce. In 2022, to understand the impact of COVID-19 on UK engagement levels, Engage for Success (EFS) conducted a national survey with a representative sample of the UK population. The results were concerning. Whilst a drop in employee engagement during the pandemic was not wholly unexpected, the depth of the drop and lack of recovery was alarming. The survey revealed a 13% decline in employee engagement during the pandemic (compared to pre-pandemic levels). Shockingly, post-pandemic levels have only showed a 3% increase. Despite hopes for post-pandemic recovery, findings suggest otherwise. Data from the 2023 EFS survey indicates a concerning lack of progress, suggesting the UK is experiencing engagement-stagnation.

Although there is a troubling narrative of flatlining productivity, dwindling engagement levels, and a disenchanted workforce, the current landscape provides an opportunity for change. Findings from the 2022 EFS survey highlighted the importance of proactive employer initiatives. Organisations that prioritised communication, involvement, development, and support for their employees demonstrated a degree of resilience from the impact of the pandemic. Notably, proactive employers witnessed only a slight decrease in engagement (between 3-5%) and had almost recovered as covid restrictions lifted. This compared sharply with employers who had been more ‘passive,’ experiencing a substantial decline (between 14-15%) with minimal signs of recovery. A similar pattern is evident in the EFS 2023 national survey, with proactive employers showing higher levels of employee engagement. Of note, organisations that measure engagement and use engagement champion networks, show higher levels of engagement. In addition, employees at organisations that recognise trade unions, express higher engagement levels.

The survey findings also emphasise the critical role of line managers and workplace relationships in fostering and nurturing engagement levels. Line managers are the primary link between the employee and the employer. The significance of this roles was demonstrated in a direct correlation between the engagement of line managers and the engagement levels of employees. However, there are ongoing issues of training, accountability, and responsibility. In addition, data from the EFS survey highlighted areas of wider societal concern, particularly in terms of training and development, hybrid working arrangements, psychological safety and trust, purpose, and employee wellbeing, all of which are contributing to declining engagement levels.  

To address these issues, a fundamental shift in the employer-employee relationship is vital. It’s crucial for organisations to prioritise individual wellbeing, foster a human-centred approach to employee experience, and re-evaluate organisational purpose. By investing in their workforce, businesses can build resilience amid economic uncertainty and pave the way for sustainable growth. However, the challenge cannot just be placed on the shoulders of organisations. It is essential for businesses and policymakers alike to prioritise strategies that foster a culture of engagement and empower employees to thrive. By doing so, we can unlock the full potential of the UK workforce.

Organisations and policymakers need to recognise that prioritising employee engagement isn’t just a moral imperative – it’s a strategic necessity.

Dr Sarah Pass, Nottingham Trent University 

Dr Pass is speaking at the IPA Employee Voice Hub webinar on 16 April 2024 when she will be sharing the result of the Engaging for Success employee engagement survey. Click here to book your free place.