Three ways to improve engagement in 2023

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Happy employees are more productive and motivated at work – and that is good for business bottom lines.

Therefore, it is no surprise that employee engagement, and having a great employee experience (EX), is top of mind for organizations in 2023.

This was the main finding of Lattice’s 2022 ‘State of People Strategy’ report, and has now been confirmed by McLean’s survey of 157,000 individuals from 179 organizations.

The resulting 2023 employee engagement trends report from McLean found that 2022 was a promising year for engagement; the main areas of success were learning and development, career advancement, and inclusion.

Of course, employers mustn’t rest on their laurels in these areas – they must continue to focus on improving the culture of learning, particularly ensuring that everyone has equal opportunities to learn and grow.

However, there are others areas that employers need to get serious about if they want to reap the rewards of having an engaged workforce who have no desire to look for a new job.

Let’s take a look at the insights from McLean’s report. What must HR leaders do to fix these issues?

1. Tackle burnout by leaning into purpose

A major concern identified by McLean was that stress and burnout remains an issue at organization. It is clear that burnout wasn’t just a COVID-19 problem – employees are still struggling, in fact Gartner said 2022 was the worst year on record for stress, and 2023 is  on track to beat that record.

Only just over half of employees told McLean they can manage their stress at work – and this only gets worse as employees get more senior.

The main cause of this stress and burnout is workload challenges – clearly, employers and employees haven’t cracked work-life balance.

One solution, according to McLean’s report, is to reconnect purpose and work. Those with high purpose are 1.3 times less likely to be stressed and 1.8 times less likely to report burnout.

If employers don’t get serious around tackling burnout and stress, and help employees – and particularly those in senior positions – to manage it, then they face high attrition rates. Remember, replacing people is much more expensive than retaining them.

2. Focus on co-worker relationships

A real positive of McLean’s report is the positive connection between engagement and workplace relationships between 2021 and 2022 (this saw a 2.9 percentage point increase from 78.9% in 2021 to 81.8% in 2022).

There was a 4 percentage point increase in the number of respondents who said their co-workers would help them out if they asked, and a 1.9 point growth in the view that their co-workers cared about them as people.

This finding shows that employers are doing something right about connection in a remote and hybrid workforce. Engagement was actually 5.5 percentage points higher for those who work remotely or embrace hybrid approaches.

Hybrid and remote work also had huge benefits for work-life balance (2.5 percentage points higher engagement) – so it could help organizations with their burnout problem.

Further building on these co-workers and encouraging employees to connect on a personal basis is crucial to improving employee engagement in other areas – and increasing intent to stay that took a dive in 2022.

McLean recommends that employers lean into buddy programs, as well as improve recognition at work.

Appreciation scores are very positive – 75.3% – but formal recognition, whether it is from leadership or peers, needs work.

The report stated: “Create or revamp employee recognition programs for a quick-win that leverages manager and co-worker relationships and that can be built on to create a culture of recognition and appreciation in the future.”

3. Step up in cost of living crisis

Another driver of employee attrition that employers need to take action around is pay. There was a 2.5 decline in scores around compensation between 2021 and 2022 to 51%.

This isn’t surprising amid economic uncertainty exemplified by the the cost of living crisis; inflation grew by up to 10% in some markets, but salary budgets only increased by 4%.

A major issue here is trust. McLean’s report stated: “There is a strong correlation between trust in executive leadership and compensation satisfaction. When employees understand the decision-making processes that go into pay decisions, they are more likely to trust that they are being paid fairly.”

Unfortunately the research found that employee trust in organizations is falling.

To help improve satisfaction and trust around compensation, organizations can increase transparency around pay and the decision-making processes used to arrive at pay decisions.”

Salary transparency is a real positive for retention – and it is something that organizations must take seriously to avoid an attrition crisis.

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