Insights, analysis, and benchmarking data for McLean & Company’s Employee Engagement Survey from 2019 to 2021. McLean & Company is a research and advisory firm that provides practical solutions to human resources challenges with executable research, tools, and advice that will have a clear and measurable impact on your business. © 1997-2022 McLean & Company. McLean & Company is a division of Info-Tech Research Group Inc. McLean & Company © | 2022 Employee Engagement Trends Ex ecutive S ummary Like everything else in the world, employee engagement has gone through upheaval over the past two years. Employees’ relationship to their organizations shifted with the onset of the COV ID-19 pandemic, remote and virtual work, and more. Employee priorities are changing, and the way organizations think about employee engagement needs to change as well. This report seeks to answer the following questions: • What impact was there on employee engagement in the immediate aftermath of the COV ID-19 pandemic? How has that impact changed in the time that followed? • What impact has the explosion of remote and hybrid work had on employee engagement? • How has the competitive labor market starting in 2021 been reflected in employee engagement data, particularly key retention drivers? • What have some of the major trends and themes been in employee engagement? McLean & Company © | 2022 Employee Engagement Trends K ey points to rememb er: • K nowing how other organizations are performing is not the best way to judge your own organization’s performance, but there is value in understanding broader trends occurring in the world. • Employee engagement action planning should always be based on feedback from your own employees, not from benchmark data. 2 Introduction 01 Engagement Overview: 201 9-2021 02 Organizational Drivers Table of Contents McLean & Company © | 2022 Employee Engagement Trends 03 Job Drivers 04 Retention Drivers Appendix Benchmarking Data: 201 9-2021 3 How to Read T his Report This report is based on data gathered from McLean & Company’s Employee Engagement Survey from January 1, 2019 to December 31, 2021. For the most up-to-date Employee Engagement data, contact your account representative for updated benchmarking information. Note: Graph totals may not add up to 100% due to rounding. Some n-counts throughout the report indicate a range of responses due to organizations who chose to omit certain questions. • 2019: 67-108 organizations, 28,537-80,600 employees • 2020: 39-83 organizations, 18,126-52,476 employees (Note: To control for factors stemming from the COV ID-19 pandemic, only data collected from April to December of 2020 was included.) • 2021: 71-140 organizations, 46,267-125,788 employees Data from McLean & Company’s 2022 HR Trends Report and New Hire Survey and Employee Exit Survey databases have also been included in this report. Data was gathered from organizations primarily based in North America. Key terms used throughout this report include: Organiz ational siz e Employee segments T op-box scores Small: 250 or fewer employees Medium: 251 to 1,000 employees Large: 1,001 or more employees Age Tenure Gender (M/F) – only two genders were analyzed due to sample size constraints Work Style (e.g. onsite vs. remote/hybrid and field) A top-box score represents the percentage of respondents with a score of 5 or 6 on a 6point scale for a question or driver. McLean & Company © | 2022 Employee Engagement Trends 4 W hat is employee engagement? Satisfied employees feel comfortable and are generally happy that their needs are being met. McLean & C ompany defines employee engagement as an overall sense of b eing energiz ed b y and passionate ab out one's work and dedicated toward one's workplace. It is important to differentiate this concept from employee satisfaction. Engaged employees feel energized, passionate, and dedicated. They are highly involved with their work and the organization. Average P erfo rm anc e Characteristics Less likely to help others for the betterment of the organization Generally keep to themselves Committed to the degree that their needs are met McLean & Company © | 2022 Employee Engagement Trends Op tim al P erfo rm anc e Characteristics Help others for the betterment of the organization Meet minimum performance requirements Stay at the organization because of what they get from it Consistently exceed performance requirements Stay at the organization because of what they give to it Recommend improvement opportunities Have a sense of purpose and pride in their work 5 A positive employee ex perience promotes strong employee engagement Individual employee engagement is the outcome of a strong overall employee ex perience (EX ), which is measured using the response to a single question: “How likely would you be to recommend this organization to a qualified friend or family member as a great place to work?” Employee ex perience is rising in priority as a way for organiz ations to improve employee-engagement-related outcomes such as productivity, retention, and more. #2 “Providing a great employee experience” jumped from 5th to 2nd in HR priorities for 2022. (McLean & Company, 2022 HR Trends Survey; n=826) This highlights the emphasis organizations are placing on helping employees adjust after having been forced to change the way work gets done. Employees are increasingly expecting a work experience that fits more seamlessly into their lives. As the outcome of an employee’s positive and negative work experiences, the employee experience is strongly correlated with employee engagement across all years measured (McLean & Company, Engagement Database, 2019-2021; n=50,438-121,650). McLean & Company © | 2022 Employee Engagement Trends 6 McLean & Company uses various measures to inform the level of engagement at an organization. SECTION 1 Employee Engagement Overview: 2019-2021 McLean & Company © | 2022 Employee Engagement Trends Employee Experience Monitor (EXM): Measures the employee experience through an Employee Net Promoter Score (eNPS) – the difference between an organization’s percentage of supporters and percentage of detractors as measured by a single question. Engagement Levels: Measures employee engagement levels (engaged, almost engaged, indifferent, or disengaged) as indicated through the average response to the Engagement Measure Q uestions – rated on a scale of 1 to 6, where 1 = Strongly Disagree and 6 = Strongly Agree. Trending Q uestions: Measures the employee’s satisfaction with their organization and job compared to a year ago, as well as their intent to stay at the organization a year from now. In the sections that follow, this report explores three engagement drivers: Organizational Drivers: Areas that influence an employee’s satisfaction and commitment to their organization. Job Drivers: Areas that influence an employee’s happiness and commitment with their day-to-day role. Retention Drivers: Areas that influence an employee’s desire and likelihood to stay at an organization. 7 Overall 2 0 1 9 -2 0 2 1 Employee Engagement and Employee N et Promoter S cores Employee Engagement scores, 2 0 1 9 -2 0 2 1 : Level Employee Engagement Level 2019 2020* 2021 Engaged 58.7% 62.0% 60.7% Almost Engaged 21.5% 20.4% 20.6% Indifferent 9.9% 9.2% 9.4% Disengaged 9.8% 8.4% 9.3% Responses are measured on a 6 -point scale: • Engaged: 5.01-6.0 • Almost engaged: 4.51-5.0 • Indifferent: 4.01-4.5 • Disengaged: 1.0-4.0 T he Employee Experience Monitor (EX M) uses the Employee N et Promoter S core (eN PS ) to gauge employee engagement using a single question on a 0 -1 0 scale: How likely would you b e to recommend this organiz ation to a qualified friend or family memb er as a great place to work? C alculated EX M S core = EX M S core – % of Promoterswith Respondents 9-10 out of 10 McLean & Company © | 2022 Employee Engagement Trends % of Detractorswith Respondents 0-6 out of 10 2019 2020* 2021 10.4 14.6 15.1 *April to December of 2020 The full response range is -100 to 100. Scores above 0 are typically considered a positive result. 8 Engagement Priority Matrix : 2 0 1 9 Engagement Priority Matrix Overview Five out of the top seven drivers for importance to overall employee engagement are organizational drivers, with Culture ranking #1 in all years measured (2019-2021). The engagement priority matrix shows how each engagement driver performs relative to one another in terms of driver score (how positively employees view this area) and impact on engagement (how much this area influences overall engagement) on an individual level. The quadrants represent the varying levels of driver score and impact on engagement for each area and can help inform action planning: • Improve: drivers that have relatively low scores and are of high importance to engagement. • Evaluate: drivers that have relatively low scores and are of low importance to engagement. • Leverage: drivers that have relatively high scores and are of high importance to engagement. • Maintain: drivers that have relatively high scores and are of low importance to engagement. Organizational Drivers Retention Drivers McLean & Company © | 2022 Employee Engagement Trends Job Drivers Work-Life Balance Working Environment and Co-worker Relationships were perceived the most positively of all drivers measured, though their impact on overall engagement were lower than many drivers. This was consistent across all years (2019-2021). 9 Engagement Priority Matrix : 2 0 2 0 * *April to December of 2020 The impact of Senior Management Relationships on engagement leapfrogged that of Department Relationships in 2020. Benefits’ overall importance to engagement and overall satisfaction increased when compared to 2019. The remote work option was seen as a valuable perk by many employees. - Organizational Drivers McLean & Company © | 2022 Employee Engagement Trends In 2020, Employee Empowerment, Culture, and Company Potential were still the drivers with the largest impact on engagement. The increased uncertainty surrounding a company’s future during the early days of the pandemic may have led to Company Potential’s increase in importance to overall employee engagement. Retention Drivers Job Drivers 10 Engagement Priority Matrix : 2 0 2 1 Organizational Drivers The Improve quadrant (high importance, low scoring) signals a significant opportunity to plan improvements related to Department and Senior Management Relationships, as well as Company Potential. - Insight Retention Drivers Job Drivers In general, employees viewed their relationships with their direct coworkers more positively than other relationships. These relationships can be leveraged to help improve overall engagement. Despite global upheaval, the drivers most important to employees’ overall engagement did not shift significantly from 2019 to 2021. However, it’s important to remember that annual engagement surveys can mask the volatility of the employee experience on a day-to-day basis. It’s important to track employees’ in-the-moment needs through an approach such as the Employee Net Promoter Score in McLean & Company’s EXM Survey. McLean & Company © | 2022 Employee Engagement Trends 11 Engagement significantly increased with the advent of the C OV ID -1 9 pandemic F ull year 2 0 1 9 vs. April-D ecemb er 2 0 2 0 As organizations adjusted to the realities of the pandemic starting in April 2020, there was an upward shift in engagement scores compared to 2019: n=52,476 62 % 8 .4 % This upward shift was seen in the following questions: 3.0% increase in “I often look forward to coming to work” 3.4% increase in “I am more satisfied with the organization now than I was a year ago” 5.1% increase in “This organization takes actions to improve employee engagement” n=35,019 of employees were engaged in 2020,* a 3.4% increase from 2019 n=31,295 of employees were disengaged in 2020, a 1.5% decrease from 2019 *April to December of 2020 n=36,634 W hat was the impact on remote/hyb rid and onsite employees? Prior to the pandemic, remote/hybrid employees were more engaged than onsite employees This trend continued into 2020 despite the large number of newly remote workers. McLean & Company © | 2022 Employee Engagement Trends % of Engaged Employees Onsite 5 5 .3 % 2019 n=9,076 Remote/hyb rid 6 1 .4 % 6 5 .4 % 2020* 2019 n=6,418 n=3,908 6 9 .4 % 2020* n=1,353 12 Increases in engagement during 2 0 2 0 were generally sustained in 2 0 2 1 Y early Engagement D river S cores Organizational Drivers Job Drivers Retention Drivers Employees viewed all engagement drivers more positively in 2 0 2 0 * than in 2 0 1 9 There were few changes in engagement drivers from 2020 to 2021 and they did not likely have a large business impact. 69% 67% Retention is a growing area of concern The exception to this was a dip in retention drivers scores in 2021, which reflects the challenges many organizations are facing with talent acquisition and retention in the Great Resignation. This trend will be further explored in Section 4. 65% 63% 61% 2019 2020 2021 n=80,600 n=52,476 n=125,788 *April to December of 2020 McLean & Company © | 2022 Employee Engagement Trends Insight Organizations who have maintained engagement progress throughout 2021 see that employees are recognizing the efforts put in to increase engagement. Now is the time to build on the progress and keep engagement high. 13 SECTION 2 Organiz ational D rivers Organizational drivers are areas that influence an employee’s satisfaction and commitment to their organization. Culture: The degree to which an employee identifies with the beliefs, values, and attitudes of the organization. Customer Focus: The employee’s belief in the organization’s strategy and ability to meet the customer’s needs and wants. Company Potential: The employee’s understanding and commitment to the organization’s mission as well as the employee’s excitement about the organization’s mission and future. Department Relationships: The extent to which employees from separate departments work together to get things done. Senior Management Relationships: The degree to which an employee believes senior management is trustworthy and transparent and values employee feedback/input. McLean & Company © | 2022 Employee Engagement Trends 14 Remote/hyb rid work did not impact views on C ulture W hen it came to perceptions of C ulture, no significant differences were found b etween onsite and remote/hyb rid workers Despite the anecdotal challenges and concerns with maintaining a strong culture in a distributed workforce, Culture scores increased between 2019 and 2020 and did not change significantly between 2020 and 2021 across the entire organization. This suggests efforts to ensure remote employees feel included and connected to the organization’s mission and values are working across the board. This is positive, as the Culture driver ranks #1 in impact on engagement. However, responses to questions in the D epartment Relationships driver did show some contrast b etween onsite and remote/hyb rid employees 9.0 % Onsite employees were 9.0% more likely* to agree with “Departments work well together to get things done.” than remote/hybrid employees. *4.7 percentage point difference 2021; n=6,659-14,303 Insight Organizations must intentionally create opportunities for cross-departmental collaboration and increase visibility of each department’s contributions. This is especially important for remote/hybrid workers who may have less exposure to other departments day to day. McLean & Company © | 2022 Employee Engagement Trends 15 Employees’ satisfaction with senior leaders increased over the past few years All questions under the S enior Management Relationships driver saw increased scores relative to the 2 0 1 9 b aseline: Communication from executives increased during the early stage of the pandemic in 2020. This is likely the cause of increased trust and understanding between employees and the leadership team. Going forward… Percentage change, 2 0 1 9 2021: The CEO/President inspires me +6.6% My department's executive leader inspires me +7.4% The executive leadership team inspires me +9.8% I trust my department's executive leader +5.4% I trust the members of the executive leadership team +9.3% My department's executive leader acts on employee feedback The executive leadership team acts on employee feedback I understand the rationale behind most of the decisions made by my department's executive leader I understand the rationale behind most of the business decisions made by the executive leadership team 35,0% 2019 n=28,537-66,848 +7.7% +9.2% 2020 n=18,548-34,256 2021 n=46,267-87,798 *April to December of 2020 +7.4% +8.6% 40,0% 45,0% 50,0% 55,0% 60,0% 65,0% 70,0% 75,0% Organizations must build on the improvements in communications seen during the pandemic, especially when it comes to transparency and closing the loop on or acting on employee feedback. This is particularly important because the Senior Management Relationships driver is a top-four driver in correlation with overall engagement. McLean & Company © | 2022 Employee Engagement Trends 16 Perceptions of senior manager relationships varied b y segment S enior Management Relationships D river b y W ork S tyle S enior Management Relationships D river b y Organiz ation S iz e 63% 64% Small 60% 57% 56% 51% 52% 45% 2019 2020 2021 n=1,790-6,737 n=1,079-1,882 n=4,168-8,949 *April to December of 2020 In 2020* and 2021, senior leaders may have focused more efforts on onsite employees facing greater uncertainty and health and safety concerns than they did on remote/hybrid staff. However, as the scores for the two groups show, leaders also need to focus on remote/hybrid employees who may be more prone to feeling disconnected from the organization, particularly where remote/hybrid work has become the norm. Insight Mediu m 2019 2020 2021 n=4,445-34,547 n=2,109-14,687 n=3,400-48,074 *April to December of 2020 Large organizations saw the biggest jump in senior manager relationship scores between 2019 and 2021, likely due to increased visibility, transparency, and communication from senior leaders. For large organizations to sustain momentum, or close the gaps with small and medium-sized organizations in this driver, they must continue to focus senior management efforts on instilling trust in employees. Communication, visibility, and transparency are the keys to strong results when it comes to senior manager relationships positively impacting employee engagement. McLean & Company © | 2022 Employee Engagement Trends 17 SECTION 3 J ob D rivers McLean & Company © | 2022 Employee Engagement Trends Job Engagement Drivers are areas that influence an employee’s happiness and commitment with their day-to-day role. Employee Empowerment: The degree to which employees have accountability and control over their work within a supported environment. Learning and Development: A cooperative and continuous effort between an employee and the organization to enhance an employee’s skill set and expertise and meet an employee’s career objectives and the organization’s needs. Rewards and Recognition: Rewards (such as tangible and intangible gifts) and recognition that employees receive as a form of acknowledgement for a job well done. Co-worker Relationships: The extent to which colleagues, who work together but do not report to one another, get along with and support each other. Manager Relationships: The quality of the professional relationship an employee has with their manager. Manager Relationships depend on the trust that exists between these two individuals and the extent that a manager supports and develops the employee. 18 J ob driver scores jumped in 2 0 2 0 , then plateaued in 2 0 2 1 J ob D rivers 2.2% 80% 6.6% 4.4%** 70% 6.0% 60% 7.0% 2019 n=50,357-66,187 2020 n=26,768-35,456 2021 n=76,813-94,088 *April to December of 2020 50% **percentage changes, 2019-2021 40% Employee Empowerment Learning and Development Rewards and Recognition Co-worker Relationships Manager Relationships W hile average job driver scores increased from 2 0 1 9 to 2 0 2 1 , the data indicates several key areas to target for improvement Most notably, employees are much less satisfied with Learning and Development and Rewards and Recognition than other job drivers. As “Opportunities for career advancement” is the #1 reason employees leave an organization (McLean & Company, 2022 Exit Survey; n=24,605), this signals the need to provide more visibility into internal career progression opportunities and encourage development activities to improve engagement. McLean & Company © | 2022 Employee Engagement Trends 19 Learning & development and rewards & recognition fall in the b ottom 3 of drivers On average, Learning and D evelopment (L& D ) and Rewards and Recognition were b oth ranked among the lowest three drivers from 2 0 1 9 to 2 0 2 1 (McLean & Company, Engagement Database n=30,830-84,873). Learning and D evelopment 5 4 .3 % 5 2 .1 % 3-year average top-box score Rewards and Recognition 3-year average top-box score McLean & Company © | 2022 Employee Engagement Trends Employees with less than one year of tenure were 1 4 .5 % more satisfied with L& D than employees with five to ten years of tenure n=4,16713,102 As satisfaction drops over time, providing meaningful continuous learning opportunities for employees at all stages of their careers is critical. Address this with an L&D strategy: having a strategic approach to L&D is associated with improved organizational performance and HR effectiveness, along with engagement (McLean & Company, 2022 HR Trends Survey; n=379-387). Employees working at small organizations were 22.5% more likely* than those in large organizations to agree with the statement “Promotions in my department go to those who deserve them the most” *10.6 percentage point difference n=1,85751,557 Being transparent with how rewards and promotions are determined may be more challenging as organizations grow, but it is an important factor in engagement. Organizations should dedicate the necessary time and resources to being transparent about how and why employee contributions are being rewarded. The correlation between praise and engagement increased year over year from 2019 to 2021 (“I am praised when I go above and beyond the call of duty”). This signals a need to frequently review and renew Rewards and Recognition efforts to help drive engagement and to instill a culture of recognition and appreciation. 20 T he impact of work style on relationships cannot b e overlooked T here are significant differences and trends in how onsite and remote/hyb rid employees perceive manager and coworker relationships Onsite vs. Remote/Hybrid: Manager Relationships n=978-11,854 86% 82% “My manager cares about me as a person” 78% 74% Onsite vs. Remote/Hybrid: Co-worker Relationships n=645-9,012 77% 72% “I have a good friend at this organization” 67% 62% 2019 Onsite Remote/hybrid 2020 2021 *April to December of 2020 McLean & Company © | 2022 Employee Engagement Trends Onsite employees’ satisfaction with Manager Relationships jumped in 2020* The emphasis placed on the health, safety, and wellbeing of onsite employees shown by many managers and organizations in the early days of the pandemic likely contributed to this change. The drop in 2021 suggests that managers must continue to strengthen relationships with their employees and demonstrate that their support extends beyond times of crisis. The dip in 2021 in how remote/hybrid employees perceive Coworker Relationships may be driven by the many newly hired remote/hybrid employees Employees who shifted to remote work in 2020 could rely on relationships previously built in-person. The decrease in these scores for 2021 may be attributed to new hires struggling to develop relationships with their coworkers in a virtual environment. At the same time, Co-worker Relationships scores for onsite employees returned to approximately their pre-pandemic baseline. 21 W ork style is also impacting other job drivers such as empowerment and L& D Remote/hyb rid employees were more satisfied with Employee Empowerment and L& D than onsite employees in 2 0 1 9 b ut viewed each driver less positively through 2 0 2 0 * and 2 0 2 1 Onsite vs. Remote/Hybrid: Employee Empowerment n=1,155-12,353 72% “If I make a suggestion to improve something in my department, I believe it will be taken seriously” 69% 66% 63% Onsite vs. Remote/Hybrid: L&D n=1,075-8,741 60% “In the last year, I have received an adequate amount of training” 56% 52% 48% 2019 Onsite 2020 Remote/hybrid 2021 *April to December of 2020 McLean & Company © | 2022 Employee Engagement Trends Accountability and control over one’s work were apparent challenges with transitioning to a virtual environment While leaders were communicating downward in 2020, newly remote/hybrid employees may have found it difficult to influence positive changes, resulting in a drop in scores. This trend continued into 2021, indicating the need for leaders to provide more opportunities for upward communication from employees. Satisfaction between onsite and remote/hybrid employees diverged in 2020 and 2021 Remote/hybrid workers may have felt they needed training on how to communicate and collaborate effectively in a virtual environment and on leveraging new tools and technologies to efficiently complete tasks. This may also be an indication of some organizations’ reliance on inperson training or may represent an undercurrent of employee dissatisfaction at the need to upskill or reskill to adjust to the virtual environment. 22 SECTION 4 Retention D rivers Retention Drivers are areas that influence an employee’s desire and likelihood to stay at an organization. An organization cannot get to engagement without satisfying a minimum requirement in these areas. Compensation: The level of fairness an employee attributes to their compensation given the work they do and what they could make elsewhere in a similar role. Benefits: Employees’ perspective of the competitiveness of an organization’s health benefits and additional perks (e.g. gym memberships, provided meals and snacks, and discounts). Work-Life Balance: The extent to which employees feel they can balance their work and personal life and manage their work stress. Working Environment: The extent to which employees feel physically and emotionally safe in their workplace. McLean & Company © | 2022 Employee Engagement Trends 23 D espite improvements in 2 0 2 0 , retention scores returned to pre-pandemic levels in 2 0 2 1 Retention D river S cores 1.1% 90% 70% *April to December of 2020 **percentage changes, 2019-2020 Perspectives on retention driver questions varied b y employee segment: Males consistently agreed that they are not discriminated against or emotionally harassed at work more than females did (2019-2021; n=8,267-29,372) 0.8% 10.3% The discrepancy between genders calls out the need for organizations to reinforce DEI as a priority and ensure all employees feel safe in their workplace. 9.1%** 50% Employees aged 4 5 and older viewed work-life b alance more positively than younger employees 30% Compensation 2019 n=38,970-60,951 Benefits Working Environment 2020 n=21,030-32,957 Work-Life Balance 2021 n=63,969-93,122 Improvements in Compensation and Benefits scores and steady Working Environment and Work-Life Balance scores despite the rapid pace of change contributed to higher engagement during the early part of the pandemic. However, in 2021 the increased scores in Compensation and Benefits returned to their pre-pandemic baseline. McLean & Company © | 2022 Employee Engagement Trends 45+ (2021; n=34,726-41,016) This signals a need to uncover the root causes of this discrepancy, such as unclear work boundaries and a lack of employee empowerment for younger employees. Retention drivers do have an impact on engagement, though it is relatively low compared to other drivers. However, their impact on retention is high. Moving forward, organizations need to focus their efforts on improving retention drivers to help alleviate the turnover challenges that began in 2021 and have continued into 2022. 24 C hanging work conditions b rought on b y the pandemic are no longer unique C ompensation and B enefits D river S cores -9.2% 64% 61,5% 56% 48% -5.6%** Organiz ations report increasing salaries and b enefits: 55,8% 50,8% 47,9% Compensation n=21,030-23,462 43% Increased salaries 40% 2020 With tight labor markets and increased ability to explore jobs beyond previous geographical boundaries contributing to increased turnover, some organizations have turned to increased Compensation and Benefits to attract and retain talent. Benefits 2021 *April to December of 2020 n=69,086-71,263 **percentage changes, 2020-2021 25% Increased b enefits McLean & Company, 2022 HR Trends Report; n=394 Regardless, employee satisfaction with these drivers decreased. While economic conditions (e.g. high inflation) can partially explain the change, there is still work to be done to understand and address the root causes of the drops and to communicate the organization’s efforts, such as through an employee value proposition. Just as many employees now expect flexible work arrangements, their definition and expectations of benefits have broadened. The drop in Benefits scores from 2020 to 2021 may be explained by increased awareness decrease in “My benefits of unique benefits and perks beyond traditional health coverage offered by competing are competitive with organizations. It may also be that the impacts of the pandemic have increased both the similar jobs I might find need for, and expectations of, expanded benefits packages. Continuous evaluation and n=77,838 elsewhere” updates of retention efforts will be required to keep on top of these trends. McLean & Company © | 2022 Employee Engagement Trends 8.9 % (percentage difference, 2020-2021) 25 W ork-life b alance is b ecoming a challenge in the new world of work W hile workplace flex ib ility comes with many b enefits, longer work hours jeopardiz e wellb eing 62% of organiz ations reported increased working hours, while 8 0 % reported an increase in flex ib ility Despite the anticipated benefits of ongoing flexibility, remote/hybrid employees’ ability to maintain Work-Life Balance in 2021 returned to pre-pandemic levels: 74% Onsite vs. Remote/Hybrid: Work-Life Balance 69% n=1,025-13,687 “I am able to maintain a balance between my work and personal life” 64% (McLean & Company, 2022 HR Trends Report; n=394) Longer hours can contribute to stress and burnout, which is a threat to employee engagement and retention. With careful management (e.g. setting clear expectations and establishing manageable workloads), flexible work arrangements can increase and sustain engagement and productivity at an organization. Insight 59% 2019 2020 Onsite 2021 *April to December of 2020 Remote/Hybrid Organizations were especially accommodating in 2020, which could explain the initial spike seen in Work-Life Balance. As remote work became the norm in 2021, employees are realizing that this work style brings its own challenges, such as a lack of separation between personal and workspace. Organizations need to get creative about how they support employees and revisit their efforts to promote all aspects of wellbeing. Mental wellbeing must be a particular focus as longer work hours may add to workload pressures and lead to employee burnout. McLean & Company © | 2022 Employee Engagement Trends 26 Actions and Practical Resources U se McLean & Company’s diagnostic products to shed light on employee engagement, experience, retention, DEI, and more. W hat C omes N ex t? It is a complex undertaking to understand the impact of the social, economic, and cultural upheaval of the past several years on employee engagement. The averages of annual surveys can mask the volatility of the day-to-day employee experience, which shows the importance of combining more frequent measurements than just the annual engagement survey. Meanwhile, the engagement of different employee groups and demographics can also be lost in averages. It’s crucial to use engagement data as a starting point rather than the end of the conversation. Dig deeper into the concerning trends and themes that emerge from your engagement data and address them using the practical resources available through McLean & Company. McLean & Company © | 2022 Employee Engagement Trends Retention drivers are always among the lowest scoring in employee engagement data, but that doesn’t mean we should accept low scores. In today’s competitive labor market, it’s crucial to create an effective talent retention plan. As salaries and benefits increase and employees’ perception of them continues to be negative, it is time to focus on how rewards are communicated, whether that’s through a strategic project like creating an employee value proposition, a tactical project like total rewards statements, or training for managers on how to have conversations about pay. The data shows that engagement differs for onsite and remote/hybrid employees. Prepare managers to lead in a hybrid work environment to minimize the impact of the new working environment on engagement. Work-life balance and burnout are becoming a challenge in today’s work environment, so take the time to revisit your wellbeing offerings. 27 Engagement D rivers (2 0 1 9 -2 0 2 1 ) 2020* 2021 Culture 72.7% 76.1% 75.0% N et change (2 0 1 9 2 0 2 1 )** + 2 .3 Customer Focus 66.2% 70.3% 69.7% + 3 .5 65.1% 69.4% 68.7% + 3 .6 : Decreased Department Relationships 61.8% 63.9% 64.4% + 2 .6 Senior Management Relationships 54.9% 59.3% 59.2% + 4 .3 2019 2020* 2021 68.9% 52.3% 50.1% 76.8% 68.6% 71.8% 55.2% 52.7% 79.0% 72.6% 71.9% 55.5% 53.6% 78.5% 73.1% N et change (2 0 1 9 -2 0 2 1 ) + 3 .0 + 3 .2 + 3 .5 + 1 .7 + 4 .5 : Similar (< =0.5% difference) 2019 2020* 2021 N et change (2019-2021) Compensation 46.6% 50.8% 47.9% + 1 .3 Benefits 55.7% 61.5% 55.8% + 0 .1 Working Environment 84.8% 85.7% 86.1% + 1 .3 Work-Life Balance 62.8% 63.3% 62.6% -0 .2 n= 38,970-66,187 responses, 72-95 organizations n=21,030-35,456 responses, 46-64 organizations Organiz ational Company Potential D rivers J ob D rivers Retention D rivers Legend for year over year change: 2019 Employee Empowerment Learning And Development Rewards And Recognition Co-worker Relationships Manager Relationships McLean & Company © | 2022 Employee Engagement Trends n=62,211-94,088 responses, 89-117 organizations *April to December of 2020 ** Percentage point difference : Increased 28 G ender comparisons (2 0 1 9 -2 0 2 1 ) Engagement Level Engaged Almost Engaged Indifferent Disengaged Legend for year over year change: G ender (M/F ) 2019 2020* 2021 N et change (20192021)** Female 58.2% 63.6% 62.6% + 4 .4 : Increased Male 59.0% 61.6% 60.8% + 1 .8 : Decreased Female 21.5% 19.9% 20.3% -1 .2 Male 21.4% 20.0% 20.5% -0 .9 : Similar (< =0.5% difference) Female 10.0% 9.1% 8.8% -1 .2 Male 9.8% 9.6% 9.3% -0 .5 Female 10.3% 7.4% 8.2% -2 .1 9.8% 8.7% 9.3% -0 .5 Male McLean & Company © | 2022 Employee Engagement Trends n=34,107-42,197 n=18,157-25,890 n=44,579-59,013 responses, responses, responses, 96 organizations 72-73 organizations 110-111 organizations *April to December of 2020 ** Percentage point difference 29 T enure comparisons (2 0 1 9 -2 0 2 1 ) *April to December of 2020 2019 3 years 5 years 10 years 1 year to Engagement Less than less than to less to less to less 1 year than 5 than 10 than 20 Level 3 years years years years 2020* 3 years 5 years 10 years 1 year to 20+ Less than to less to less to less less than years 1 year than 5 than 10 than 20 3 years years years years 2021 3 years 5 years 10 years 1 year to 20+ Less than to less to less to less less than years 1 year than 5 than 10 than 20 3 years years years years 20+ years Engaged 63.0% 56.1% 55.0% 58.8% 60.6% 60.5% 67.8% 60.7% 59.6% 63.0% 64.3% 68.4% 66.6% 59.5% 58.4% 59.1% 61.6% 65.4% Almost Engaged 19.5% 22.7% 22.3% 20.9% 22.2% 20.6% 19.1% 21.1% 21.0% 20.5% 20.0% 17.7% 17.7% 20.9% 21.4% 21.2% 21.1% 20.1% Indifferent 9.0% 10.5% 11.8% 10.6% 9.0% 9.7% 6.8% 9.5% 10.4% 8.8% 8.9% 7.3% 8.1% 9.3% 10.4% 9.9% 9.0% 7.7% Disengaged 8.4% 10.8% 11.0% 9.8% 8.2% 9.2% 6.3% 8.7% 9.0% 7.7% 6.8% 6.6% 7.7% 10.3% 9.8% 9.8% 8.3% 6.8% n=8,117-14,835 responses, 55-89 organizations McLean & Company © | 2022 Employee Engagement Trends n= 4,937-10,823 responses, 47-69 organizations n= 9,346-23,824 responses, 90-123 organizations 30 Age comparisons (2 0 1 9 -2 0 2 1 ) *April to December of 2020 2019 Engagement Y ounger than 25 Level 25-34 2020* 35-44 45-54 Older than Y ounger 54 than 25 25-34 35-44 2021 45-54 Older than Y ounger 54 than 25 25-34 35-44 45-54 Older than 54 Engaged 49.7% 51.5% 59.3% 62.1% 66.4% 53.3% 53.5% 61.5% 66.2% 70.0% 49.8% 52.4% 60.6% 64.9% 69.7% Almost Engaged 23.4% 22.8% 22.7% 20.3% 18.6% 23.9% 22.8% 21.8% 19.1% 16.3% 21.6% 23.2% 21.0% 20.1% 16.8% Indifferent 11.1% 12.7% 9.4% 9.4% 7.4% 11.5% 12.8% 9.2% 7.6% 7.5% 12.6% 11.5% 9.7% 7.9% 6.8% Disengaged 15.8% 13.0% 8.7% 8.3% 7.5% 11.3% 10.9% 7.5% 7.1% 6.2% 16.0% 12.8% 8.7% 7.1% 6.7% n=3,221-17,801 responses, 54-88 organizations McLean & Company © | 2022 Employee Engagement Trends n=3,583-10,410 responses, 42-63 organizations n=6,439-24,292 responses, 69-116 organizations 31 W ork style comparisons (2 0 1 9 -2 0 2 1 ) Engagement Level W ork S tyle Engaged Almost Engaged Indifferent Disengaged Legend for year over year change: 2019 2020* 2021 N et change (20192021)** Onsite 55.3% 61.4% 59.7% + 4 .4 : Increased Remote/hybrid 65.4% 69.4% 60.7% -4 .7 : Decreased Onsite 23.1% 21.6% 21.8% -1 .3 Remote/hybrid 17.4% 15.0% 19.6% + 2 .2 : Similar (< =0.5% difference) Onsite 10.3% 8.5% 9.0% -1 .3 Remote/hybrid 8.6% 9.1% 10.1% + 1 .5 Onsite 11.4% 8.5% 9.6% -1 .8 8.6% 6.5% 9.6% +1 Remote/hybrid McLean & Company © | 2022 Employee Engagement Trends n=3,908-9,076 n=1,353-6,418 n=6,893-12,449 responses, responses, responses, 16-20 organizations 12-16 organizations 20-23 organizations *April to December of 2020 ** Percentage point difference 32 Organiz ation siz e comparisons (2 0 1 9 2021) *April to December of 2020 2019 Engagement Level Small Medium 2020* Large Small Medium 2021 Large Small Medium Large (< =250 employees) (251-1,000 employees) (> 1,000 employees) (< =250 employees) (251-1,000 employees) (> 1,000 employees) (< =250 employees) (251-1,000 employees) (> 1,000 employees) Engaged 61.3% 57.6% 54.9% 64.0% 60.4% 62.6% 63.2% 59.3% 59.9% Almost Engaged 20.3% 22.5% 22.5% 19.8% 20.9% 20.1% 20.4% 21.3% 20.2% Indifferent 9.3% 10.0% 11.0% 9.2% 9.5% 8.8% 7.9% 10.2% 9.6% Disengaged 9.1% 9.8% 11.6% 7.0% 9.2% 8.4% 8.5% 9.2% 10.4% n=5,430-60,428 responses, 27-46 organizations McLean & Company © | 2022 Employee Engagement Trends n=3,005-32,901 responses, 20-25 organizations n=4,511-97,141 responses, 38-41 organizations 33 London, ON Corporate Headquarters 345 Ridout Street North London, Ontario, N6A 2N8 McLean & Company is the trusted partner of HR and leadership professionals around the world. Our memberships are designed to provide what you need to drive the organization forward – from full-service assessments to practical action plans, impactful training, and more. When you pair our comprehensive resources with our collaborative services, there's nothing between you and your goals. As a partner, we listen first to understand your situation, then guide you through each step of the way so you get where you want to be, faster and with confidence. At McLean & Company, we’re passionate about empowering leaders like you to shape a workplace where everyone thrives. McLean & Company is a division of Info-Tech Research Group Inc. McLean & Company © | 2022 Employee Engagement Trends Toronto, ON 888 Y onge Street Toronto, Ontario, M4W 2J2 Las Vegas, NV 3960 Howard Hughes Parkway, Suite 500 Las V egas, NV , U SA, 89169 Sydney, Australia Level 4, 20 Hunter Street Sydney, NSW, Australia 2000 North America: 1-877-281-0480 International: + 1-519-936-2659 mcleanco.com 34 McLean & C ompany offers various levels of support to best suit your needs D IY T oolkit G uided Implementation “Our team has already made this critical project a priority, and we have the time and capability, but some guidance along the way would be helpful.” “Our team knows that we need to fix a process, but we need assistance to determine where to focus. Some check-ins along the way would help keep us on track.” W orkshop C onsulting “We need to hit the ground running and get this project kicked off immediately. Our team has the ability to take this over once we get a framework and strategy in place.” “Our team does not have the time or the knowledge to take this project on. We need assistance through the entirety of this project.” D iagnostics and consistent frameworks are used throughout all four options. McLean & Company © | 2022 Employee Engagement Trends 35 Employee Engagement C oaching Equip your leaders with everything they need to succeed with engagement action planning. Our trained coaches work one on one with your leaders in a confidential environment to accelerate their confidence, self-awareness, and development. How It W orks U nderstand their team’s Engagement Report and prepare for their team discussion. This virtual coaching is available for groups of 10+ leaders in your organization. After completing McL ean & Company’s Employee Engagement Survey, each leader will receive three 50 minute 1:1 sessions with a trained coach. Feel clear and confident about how to act on Engagement Report results. This four month program can be supplemented with additional sessions in year two for an additional fee. This coaching is offered to clients that use our Employee Engagement Survey. Increase self-awareness and identify their role in improving team engagement. Engagement S urvey YEAR 1 When survey launches S ession 1 S ession 2 S ession 3 YEAR 2* Option A: 3 additional coaching sessions based on 2nd year engagement survey results. Within 2 weeks of results being provided to leaders McLean & Company © | 2022 Employee Engagement Trends After team focus groups (or about 4 weeks later) 3 months after Session 2 Option B: Further leadership coaching based on the results of a 360feedback survey. Coaching program fees are billed annually Build a Data-Driven Strategy Using F ull-S ervice D iagnostic Programs Improve Employee Experience and HR Processes Employee Engagement Move beyond measuring job satisfaction with a comprehensive view of engagement. McLean Employee Experience Monitor Evolve to leader driven engagement with a real time dashboard and results. N ew Hire S urvey Ensure recruiting and onboarding programs are effective by surveying new employees. Employee Retention Pulse S urvey Identify warning signs for regrettable turnover. D iversity, Equity & Inclusion Engagement Pulse Take a thoughtful approach to mobilize inclusion efforts across your organization. Employee Exit S urvey U nderstand why people leave the organization to proactively retain top talent. 360 F eedback Empower employees with a holistic view of their performance to prioritize development. Optimiz e the HR D epartment for S uccess HR S takeholder Management S urvey Align HR initiatives with business strategy and stakeholder needs. McLean & Company © | 2022 Employee Engagement Trends HR Management & G overnance Improve HR’s core functions and drive project success. 37 L eadership M em bership The Leadership Membership Difference Th is m em b ersh ip will give yo u th e to o ls yo u need to p ush yo ur H R dep artm ent furth er, faster. Co m p lete m ajo r p ro jec ts with th e h elp o f a dedic ated Ex ec utive Adviso r wh o is a fo rm er H R leader. You’ll get a dedicated Executive Advisor, who is a former HR leader with deep experience across many research areas. They will help you identify strategic initiatives, prioritize projects, mitigate challenges, direct you to the relevant research or subject matter experts, and keep you on track. We recommend you meet at a minimum quarterly for a touch point, in addition to the unlimited advisory calls while working with our SME advisory team, with flexibility to leverage additional touch points and select advisory calls with your Executive Advisor as you work toward delivering key initiatives. Boost your own development with one 360 Feedback personal evaluation, including one debrief session and a separate development planning session. Your choice of one ticket to McLean & Company’s Signature Conference or one ticket to our virtual Elevate HR strategic leadership development course. Ideally, we’d like you to benefit from these events, although the ticket could be transferred to a colleague. McLean & Company © | 2022 Employee Engagement Trends Leverage the expertise of fellow senior HR leaders in Q uarterly Leadership P eer to P eer Roundtables. These 60 minute, facilitated discussions are an opportunity to network and collaborate in an open, honest, and inclusive virtual space. Save money and obtain peace of mind from our HR technology vendor management and contract review services. This helps you assess, manage, and reduce costs while strengthening vendor relationships. 38 Co unselo r Seat Servic es The Counselor Membership Difference Features: You’ll get a dedic ated Ex ec utive Co unselo r wh o is a fo rm er Senio r H R Exec utive and h as b een in yo ur sh o es. You will benefit from two online advisory sessions throughout the year (along with unlimited scheduled and ad hoc phone calls), which integrate your Executive Counselor as a trusted part of your professional support network. U se these meetings to cover anything you’d like, from prioritizing your own development to working through a project. Your Executive Counselor can help you navigate board or executive-level challenges and prepare for meetings. L everage yo ur perso nal Exec utive Co unselo r to m ake yo ur p erso nal and p ro fessio nal develo p m ent a p rio rity. Your customized Personal Leadership Development Plan created with your trusted Executive Counselor will link to your personal and organizational goals and values. You’ll develop a custom, authentic Leadership Brand that allows you to thrive and better market your unique value proposition. P lus all th e b enefits o f a L eadersh ip M em b ersh ip suc h as: You’ll get access to cutting edge IT research via our IT division, Info Tech Research G roup. Your dedicated Executive Counselor will provide a high-touch-point, customized experience to help you develop yourself and your team while increasing your personal and functional strategic impact. The McLean Membership serves your firm; the Counselor membership serves you personally. McLean & Company © | 2022 Employee Engagement Trends N etwork and collaborate with fellow senior HR leaders in Q uarterly Leadership P eer to P eer Roundtables. Your choice of a ticket to McLean & Company’s Signature Conference or to our virtual Elevate HR strategic leadership development course for a total of two tickets. Protect your organization and save money with expert HR technology contract review and price benchmarking & negotiation. 39 D evelop managers and your HR team with our learning solutions D evelop your managers with our varied, interactive, remote training sessions. S ample topics include: McLean Academy Elevate HR Online Management F undamentals Online A self-paced eLearning program for HR professionals. The curriculum is built around McLean's HR framework and provides practical, outcomedriven advice on tackling HR initiatives. A blended learning program designed to develop a strategic HR mindset and help HR practitioners better respond to the growing complexity of the workplace of the future. A practical, interactive, and impactful blended learning program designed to develop foundational management capabilities. McLean & Company © | 2022 Employee Engagement Trends • Master the 3i’s of Employee Engagement • Build High-Performing Teams • Master Difficult Conversations • Emotional Intelligence in Leadership • Lead Through Change • Manage Remote Teams • Give Effective Feedback and Coaching • Systems Thinking 40 McLean & Company is the trusted partner of HR and leadership professionals around the world. Our memberships are designed to help leaders drive their organization forward. 1997-2022 © McLean & Company. McLean & Company is a division of Info-Tech Research Group Inc.