Key Takeaways from the Gallup State of the American Workplace Study

Each year, Gallup releases new reports about the workplace that help us understand trends that can help us be better managers.

One of those reports is the annual State of the American Workplace study (read the 2017 edition here or the 2023 edition here). They are one of their most comprehensive looks at what really motivates and engages employees.

As we've done in the past for Gallup's State of the American Manager, Deloitte's Study of Millennials, and others, we've pulled out some of the essential takeaways from these State of the American Workplace studies you should know for your teams and companies.

Since we've looked at these across multiple years, we'll also be showing you how they've changed over time. As you might suspect, things do change over time, while there are some fundamental truths about work that stay the same.

Key Takeaways from the Gallup State of the American Workplace Studies

The hard thing about soft skills is how difficult and imprecise they can be to measure. Fortunately, Gallup has been surveying managers and employees for decades. They've got it down to a science, and they annually report on those findings.

The State of the American Workplace represents over 31 million responses from 195,600 employees over the last 2 years. Here are some of the most interesting takeaways we found in reviewing the 2017 and 2023 editions.

Engagement is still terrible.

Gallup has been measuring engagement consistently since 2000, and unfortunately the numbers have rarely changed. As the report put it:

"Only one-third of U.S. employees are engaged in their work and workplace. And only about one in five say their performance is managed in a way that motivates them to do outstanding work."

This chart paints the stark picture:

And if you're not familiar with the designations, here's what they mean: (Note - not engaged is not displayed in the chart above, but represents the remaining percentage out of 100 not measured as "engaged" or "actively disengaged")

You can see the trend was slightly up from the Great Recession, but has since downturned since COVID and the many challenges of the 2020s. Sadly, regardless of era, when roughly 2 out of 3 employees are still mailing it in, or are fully disengaged at work, there's consistently more work to be done.

Gallup's State of the American Workplace report is an indictment of American leadership styles

There are many causes of poor employee engagement, and the majority of them trace back to leadership actions (and inaction).  In particular, Gallup found a few results that are disappointingly low:

• 22% of employees strongly agree the leadership of their organization has a clear direction for the organization.
• 15% of employees strongly agree the leadership of their organization makes them enthusiastic about the future.
• 13% of employees strongly agree the leadership of their organization communicates effectively with the rest of the organization.

The fact that they're all poor makes sense. Without strong communication, it's not surprising a path for the organization isn't clear, which then makes enthusiasm for the future unlikely.

As we know from a past study from Harris poll, most managers are afraid to communicate with their teams:

Meanwhile, a study reported in the Harvard Business Review found the most basic form of communication, one on ones, can have a massive impact on the opinion of leadership, and the degree of employee engagement:

"When a manager doesn't meet with employees one-on-one at all...Employees are four times as likely to be disengaged...and are two times as likely to view leadership more unfavorably compared to those who meet with their managers regularly."

Suddenly, it's not so surprising that engagement is so poor. As Gallup's CEO, Jim Clifton, writes, companies need to take their medicine:

"Organizations have nowhere to hide. They have to adapt to the needs of the modern workforce, or they will find themselves struggling to attract and keep great employees and therefore customers."

This message is the centerpiece of Gallup's report.

Many employees are ready to move on

If you're worried about retention at your company, or already have a problem with turnover, the results of the State of the American Workplace are not encouraging. Employees are thinking more and more like free agents. They're thinking about their next move, as indicated in the 2017 report:

"A record 47% of the workforce says now is a good time to find a quality job, and more than half of employees (51%) are actively looking for new jobs or watching for openings."

And 6 years later, it's still just as high:

"51% of currently employed workers said they are watching for or actively seeking a new job."

This new normal level of half of staff looking for the exit is a new trend as that wasn't the case a decade ago:

A belief that there are more options, remote work making it easier to change jobs, and a lack of change in the average American workplace's quality of environment for too long seems to have many thinking the "grass is greener" at other workplaces, as remarked in the 2017 report:

"Currently, 63% believe it is "very likely” or "somewhat likely” that they would find a job as good as the one they have, up from 42% who said the same in 2010."

Yet, there is hope. In the 2023 report, they found a key difference in which employees are looking for the door most, versus who are likely to stay:

Unfortunately, a lot of workers seem to have a mercenary attitude even if they like working with you at your company, but you can see that actively disengaged employees are 40% more likely to be watching or actively seeking a new job.

If you're worried someone on your team is looking for another job, Gallup's data gives you many reasons to think they probably are. Remember: You have to act now. By the time they have an offer it's too late.

To get ahead of further turnover issues, an important first step is to know the employee retention rate. If you don't know how to calculate it, then here you can find an employee retention rate formula.

Growth & development is still at the top of employees' wish lists

We've talked about the importance of growing your employees many times before on the Lighthouse blog, and Gallup's State of the American Workplace reports only add to this overwhelming pile of evidence:

1) "68% of employees believe they are overqualified for their current job"

From the 2017 State of the American Workplace report, this is likely an artifact from the Great Recession, where people often took jobs they were overqualified for, because they really needed a job. However, it's also a case of people being in the same job for too long.

When you have the same job and responsibilities for too long, it's easy to grow bored, and feel overqualified. All too often, this happens on teams where managers take their team for granted and don't realize just how long some people have been doing exactly the same thing.

Even if you can't promote your people, there are a lot of things you can do to help them grow. You can learn a variety of approaches to doing so in our post on "How to Grow Your People When You Can't Promote them" here.

2) Growth is important to everyone, but especially Millennials.

As you can see in the chart below from the State of the American Workplace, Millennials are very concerned with the trajectory of their careers. (Note: this is from the 2017 report, so prior to the entry of much of Gen Z to the workplace, but you can extrapolate they will have similar concerns at that life stage)

Are you helping your early and mid career staff grow? Are you talking about their growth path? If not, we can see clearly that they're probably seeking growth opportunities at another company.

3) Goals should be a conversation, not a dictatorship

One of the most disappointing stats is just how few employees feel involved in their goal setting process:

"30% of employees strongly agree that their manager involves them in setting their goals at work."

Often, the goals set for you are your single best opportunity for growth; your goals will tie directly to potential future raises, recognition, and promotions. A good goal also stretches you, providing much of the growth employees crave.  This is likely why then it's so strongly tied to engagement:

"Those who do strongly agree with [their manager involves them in setting their goals] are 3.6 times more likely than other employees to be engaged. "

If you're not involved in the process of setting your goals, what are the odds they align with ways you'd like to grow?

As leaders, these goals conversations should be easy. Most employees want to help their company succeed, and with just a few tweaks and a little input, they can feel increased input and strong alignment between what you need and their goals.

Further reading:

• Employee Development: How To Grow Your Employees When You Can't Promote Them.
• The 8 Best Professional Development Goals For Managers.
• How To Help Your Team Achieve Their Goals.

The evolving job search process

In the 2017 edition, Gallup went beyond just engagement. They also expanded to look at why people leave jobs, and what attracts them to their next one in the State of the American Workplace report.

The reasons people leave jobs are not entirely surprising, and it is just as applicable today. It's things you would expect like:

• Career growth opportunities
• Pay/benefits
• Their manager or management in general
• Company culture
• Job fit

We've heard these kinds of concepts before, and so many of them are why people leave managers, not companies.

Your manager influences how close your job is to the description you were promised. They are key to your career growth, and are the main representative of your company's culture, as we love to quote Andy Grove on:

How well are you adapting to the new way people search for jobs?

The world is very different from a generation ago. What used to be THE WAY to find jobs is relegated to the bottom of Gallup's list, replaced by modern technology:

While professional organizations and news media are falling, and internet options rise, the highest yield is surprisingly low tech.

Let's look at the top ones: 3 out of 4 people are doing all of the following:

• Checking out your company's website to learn about you: What impression does your site give? How easy is it to find out you're hiring?
• Talking to current employees at your company: If your engagement scores are low, that's a lot of people that may actually discourage people from working there. And this gets even tougher now that sites like Glassdoor are so well known.
• Talking to their friends and family: Who is more likely to give you an honest evaluation, or a strong sell if they're happy?

If you have trouble recruiting, asking yourself how you treat your current employees might be a major part of why.

Further reading:

• 14 Things You Didn’t Plan For When You Started Hiring Remote Employees.
• How To Improve Your Employee Onboarding Process To Engage Your Hires & Prevent Turnover.
• The Key Interview Tactic That Will Help You Hire Great Employees.

How is stress impacting your team's engagement?

The 2023 State of the American Workplace report takes a new look at the deep and broad impact that stress is having on all of us at work. Unfortunately, over the years, it seems workplace stress is only increasing:

As you can see, except for a few brief drops, stress is steadily increasing over the last decade.

What's a manager to do about this? Fortunately, the Gallup State of the American Workplace report added some helpful nuance to this challenge.

Engagement levels and work location both impact stress

By far the most information dense and interesting chart in the 95 page 2023 edition of the report is this one combining engagement levels and work structure (remote vs. hybrid vs. in-person):

There's a lot to unpackage from this chart, so let's break it down:

1) Stress is high for employees regardless of location if they're actively disengaged

This one makes a lot of sense, doesn't it? Remember that actively disengaged is defined as, "Employees that are unhappy at work - they are resentful that their needs aren't being met and are acting out their unhappiness. Every day, these workers potentially undermine what their engaged coworkers accomplish."

If that's how you felt, wouldn't it also be stressful at work? You'd be on edge looking out for the next conflict, the next frustrating moment with your boss, or the next slight or criticism.

You can help reduce this kind of stress, and bring actively disengaged employees back into more positive outlooks by taking the time to really listen to them. Hear them out on frustrations and see what you can do to address them and reduce some of their stress. You may be surprised by the impact that can have.

2) Not engaged employees seem to have significantly reduced stress if they come into the office on-site

While remote and hybrid work setups lead to similarly high stress levels of 43% and 45%, there's a significant reduction (13-15%) in stress for especially the "Not engaged" employees down to 38% if they're working on-site with their colleagues.

This makes sense as well given that not engaged is defined as "employees are psychologically unattached to their work and company. Because their engagement needs are not being fully met, they're putting time - but not energy or passion - into their work."

If you're feeling dispassionate about your work, it's much easier to get motivated if you're at least around your coworkers and the energy of an office. When you're half-checked out, finding the motivation to get through the workday can be hard, and likely adds to your stress level.

3) Engaged employees are also slightly less stressed if they're working on-site

Hidden among the larger bars for the disengaged and not engaged employees is the fact that even for your engaged employees, being on-site as a team leads to ~10% less stress (32% or 34% vs. 29% on-site).

This brings us to the 4th and most powerful point worth considering:

4) A hybrid workplace setup is the most stressful setup regardless of engagement level

By far, the most interesting takeaway I took from the report is this one. Regardless of whether you're fully engaged, not engaged, or actively disengaged, it seems hybrid work makes everyone more stressed.

Yet, once we stop and reflect, this also is very logical. When you have a hybrid team:

• Communication is harder as sometimes the right person isn't around or available.
• Some people miss out on certain things because they're not in the office at the time.
• Two classes of employees can develop between those in the office and those remote.
• In a crisis, it can be even more stressful and challenging as communication is slower, disjointed, impacted by connectivity issues or time zones, and more.

And that's just the tip of the iceberg for challenges managing partially remote teams.

Unfortunately, that's the reality for most of it as Gallup reported earlier this year that hybrid work is now the dominate way we all work:

Knowing this is the dominant way we work now, as managers we have two choices:

1. Narrow our job opportunities by focusing only on non-hybrid work environments
2. Lean into the challenges and help your teams reduce stress

While there are a variety of general tactics that you can apply to reduce workplace stress, Gallup also added some interesting nuance to the stress question that can help you know where you can have the largest impact as a leader:

Much of the data in the Gallup State of the American Workplace 2023 report examines numbers globally, but the report also includes regional analysis for certain subcategories. The data above is focused on Canada and the United States, and in the report you can look up your region if you're in another area.

What we see in the data above is a few key, actionable points for managers like you:

• ~19% more women are stressed at work on a daily basis than men.
• Younger team members (under 40) are 28% more likely to be stressed.
• Managers are ~5% more stressed than their individual contributor counterparts.

With this information, you can use it as guidance for whom to keep an eye on stress levels a bit more for, and ask about in their 1 on 1s. Also, especially with the younger generation being so much more stressed, teaching your young team members how to deal with stress is a win-win area for growth for them and the way you can support them.

All this work on to help your team with stress pays off.

Gallup found that those with less stress tend to be more engaged:

Stress is just one piece of the engagement puzzle, but given everything happening in the world today, it's little surprise many of us are dealing with more stress that then impacts how we perform at work.

Further reading:

• 8 Ways To Address Your Workplace Stress You Can Start Today.
• Dealing With Stress And Being A Manager.

Learn more in Gallup's State of the American Workplace Report...

In 2017, Gallup released a comprehensive 214-page study, and there is now an equally interesting 2023 report, which is a more concise 95-page report.

If you want to go deeper than our overview today, downloading these reports for yourself will reveal regional data for various countries around the world as well as additional insights that can help you learn the best ways to boost engagement on your team.

You can check out both State of the American Workplace reports from these links:

• Gallup State Of The American Workplace Study 2017
• Gallup State Of The American Workplace Study 2023

Also, Lighthouse friend, Mark Crowley has written up his own insights from the 2017 report you can read here. 

Finally, if you love report analysis like this, you can also read our takeaways from Gallup's State of the American Manager report from here, and from Gallup's book on what great managers do differently here.

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