After years of declining employee engagement levels around the world, a new analysis released today by Aon Hewitt, the global human resource solutions business of Aon plc (NYSE:AON), showed a positive global shift in employee engagement – or emotional and intellectual involvement in the workplace.
Aon Hewitt’s 2012 Global Engagement report, which analysed the employee engagement trends of more than 3,100 organisations representing 9.7 million employees worldwide, found that 58 percent of employees were engaged in 2011, up from 56 percent in 2010.
Aon Hewitt’s analysis showed improvements in employee perception scores in three key areas in 2011:
- Effective leadership at the business unit/division level was 61 percent, up from 54 percent in 2010
- People/HR practices creating a positive work environment was 53 percent, up from 47 percent in 2010
- Perceiving relationships with customers as rewarding was 75 percent, up from 70 percent in 2010
The analysis also showed a decline in three key perception scores in 2011:
- Effective communication was 42 percent, down from 46 percent in 2010
- Innovation was 52 percent, down from 55 percent in 2010
- Workplace safety and security was 75 percent, down from 78 percent in 2010
Pete Sanborn, co-president of global compensation and talent at Aon Hewitt, said:
“Business leadership as well as HR programmes that meet the needs of specific employee segments contributed to the upward shift in engagement levels. However, with one out of every four people not engaged worldwide, more needs to be done. As the economy improves, retaining top talent is going to be difficult. Now is the time for organisations to measure and gain insights on engagement drivers and to start doing the work necessary to improve engagement.
“Our research shows that organisations with higher engagement have significantly higher total shareholder return than the average company, so organisations that focus on what matters most in connecting employees to their work will emerge as leaders – and the others will be left behind.”
Engagement levels by region
While overall engagement levels increased, Aon Hewitt’s study found significant variation by region. Europe showed an upward shift by one percentage point from 51 percent in 2010 to 52 percent in 2011, while Latin America, the region with the highest regional engagement levels, experienced a slight decline in engagement levels, from 72 percent in 2010 to 71 percent in 2011. Employee engagement scores in North America remained unchanged from 2010 at 64 percent. Improvements in Asia Pacific engagement scores (58 percent in 2011 versus 55 percent in 2010) contributed to the overall upward movement of global engagement.
Overall Employee Engagement Scores By Region
Region 2011 2010
Europe 52 percent 51 percent
Asia Pacific 58 percent 55 percent
North America 64 percent 64 percent
Latin America 71 percent 72 percent
Jenny Merry, UK engagement practice leader at Aon Hewitt,said:
“Our global clients are becoming increasingly sophisticated in analysing engagement results by region and business unit. We are cascading the results and insights further into organisations so that companies can implement targeted actions that will have the most impact on the engagement levels of discrete employee populations.”
Re-engaging the Workforce
Aon Hewitt’s report also analysed which engagement drivers had the most positive impact on engagement and offered the opportunity for improvement. The analysis shows that organisations are likely to get the highest return on investment in employee engagement if they focus on improving the following drivers:
- Career opportunities: For the fourth consecutive year – globally, as well as across all regions – career opportunities remained the top driver to make a positive impact on overall engagement levels.
Jenny Merry said: “2012 will be a challenging year for employers in this category as a result of limited career development and advancement opportunities. Now, more than ever, organisations must communicate clear career paths, prepare employees for the next role and provide lateral growth opportunities for key employees.”
- Recognition: Aon Hewitt’s analysis shows that recognising the extra effort employees have given in a tough business climate by providing feedback and positive reinforcement will pay dividends – and it often comes at no cost to the organisation. We found that recognition has a higher impact for employees in Asia Pacific and Latin America than in other regions.
- Organisational reputation: People want to be part of a respected and winning team. Aon Hewitt’s analysis found that European and North American employees are more concerned about their company’s reputation and what it stands for in the market versus recognition.
Jenny Merry said:
“Employees join organisations that have a reputation as a best employer, and they are also engaged by working for a best employer. This driver is about connecting employees to the company, the mission and the work beyond financial business performance, and showing them how their work experience cannot easily be replicated elsewhere.”
- Communication: Aon Hewitt’s analysis shows that effective and engaging communication resonates with employees in rationally, emotionally and behaviorally relevant ways.
Merry added, “Corporate communication is the primary connection point between the majority of employees and executive leadership. We saw that employee perceptions of communication declined in 2011. As companies recovered from the recession, they likely became less focused on clear and consistent communication from leaders. Messages usually break down at the mid-management or immediate manager level so it is important for the leaders to continue to provide clear messages about business objectives, challenges and what is required of employees.”