How Much Are Your Disengaged Employees Costing Your Business?

December 8, 2019
Are your employees not engaged at work? This could be costing your business a lot more than you thought.

The rate of (dis)engagement

When you're managing a business, it's pretty difficult to be everywhere at once. It's also nearly impossible to know what is going on with each employee throughout the workday.

Are your employees not engaged at work?

If they are not, like the majority of workers in the U.S., then this could be costing your business a lot more than you thought.

First, let's take a look at the numbers.

Statistics of disengaged employees

Only 33% of U.S. workers are actually engaged at their job.

The remaining statistics show that 51% are not engaged and 16% are actively disengaged.

Businesses working primarily with millennial employees would be interested to know that only 29% of millennials are actually engaged - leaving a whopping 71% of general disengagement.

Let's not forget that millennials account for 38% of the U.S. workforce.

How is employee disengagement affecting your business?

Ubeya's research has shown that employees that are not engaged at work are more prone to absenteeism or ghosting.

Not only is there a higher chance these workers won't show up for the job, but businesses see lower profitability rates and lower productivity per worker.

Costs of disengaged employees

How much are your disengaged employees actually costing you?

Disengaged employees cost their companies approximately 34% of the employee's annual salary.

Result of employee disengagement in the workplace

Okay, so if we do the math together -

The average annual salary in the United States is $47,060 per employee. 34% of that: $16,000.

That is a cost of $16,000 per year per a single disengaged employee. Which is, in most cases, entirely preventable.

Across the U.S., the numbers show the massive effect disengagement has on the work economy. Estimates show that actively disengaged employees cost U.S. businesses roughly $480 billion to $600 billion each year.

The businesses working with Ubeya have rated these 3 factors as being mainly responsible for massive disengagement costs: lost productivity, low profitability and expensive turnover rates.

The more disconnected employees feel from the company they are working with, the more likely they are to approach their job half-heartedly or jump ship. Hiring new staff can be a lengthy and expensive process. The communication and management channels businesses use through Ubeya help connect their employees, keep them engaged and benefit from the increased engagement.

The benefits of engaging employees

It’s one or the other. When employee engagement rises, turnover rates decrease drastically. And then everybody benefits.

The employee engagement rates that Ubeya analyzed through their system shows a cycle of higher employee engagement leading to higher productivity levels, higher profitability per employee and higher sale rates.

Once employee engagement is on the rise, all those employees ghosting their jobs? Gone. Absenteeism is drastically lowered and turnover rates decrease as well.

Engaged employees show up to the job and stay at their jobs.

Ubeya's analysis concluded that businesses with above-average engaged employees show a statistically increased likelihood of success!

How can you engage your team?

Investing in employee engagement and taking strategic actions makes it more likely that employees will have above-average productivity and result in the better for all players— employees, employers and the business as a whole.

1. Acknowledging is the first step

Creating a better work environment is not an easy task. Businesses that already acknowledge the problem and commit to make a change are already taking a major step forward that other companies are not.

Employees that see verbal and active acknowledgements regarding issues, changes or improvements in the workplace will feel part of a more welcoming and secure environment.

2. Managers are the secret to success

Companies need to use their strongest hand when it comes to successful engagement — managers.

Managers arguably play the most significant role when it comes to promoting employee engagement. Managers and operational leaders are the ones affecting team motivation, creating the level of accountability and determining the method of communication.

When managerial expectations are clear and managers provide adequate job details and resources, the workforce runs smoother and remains engaged.

3. Flexibility and stability are key factors

Businesses that promote flexible schedules and hours, as well as an easy way for employees to access work schedules and shifts see an increase in their employee engagement and satisfaction.

It is important that there be a balance between a flexible work schedule in an organized, stable fashion so that employees are kept up-to-date and have all essential information at hand.

4. Optimizing communication between all players

Companies that can optimize employee management and communication will improve internal efficiency, client satisfaction and employee engagement.

Some good ideas include investing time in team building and building relationships between managers and employees. Consider a form of open communication and creating an easy way for employees to interact, ask questions and speak with managers.

Managers should provide an easy way to update and stay in contact with employees.

5. Integrating technology to engage employees

Using an employee management tool or mobile app has been shown to dramatically boost the flow of communication, the ease of management and employee engagement in the workplace.

When mobile apps are used by operational managers and leaders to distribute essential or day-to-day information pertaining to the job, provide guidance and respond swiftly, customer satisfaction rises dramatically. There is a direct correlation between the increase in customer satisfaction and increase in revenue.

The transformation of the way businesses manage their workforce can determine the growth and success of a business. In face of the changing landscape of the modern workforce, insights into internal business engagement can help businesses build a new method of employee management and communication.

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