The UK has one of the least engaged workforces in the world

Small business owners in the UK are being urged to develop their employee engagement strategies, after a report has found that 9 out of 10 UK workers are disengaged with work.

Workplace consultancy Gallup released its State of the Global Workplace 2023 report this week. The findings make dire reading for small employers in the UK. Only 10% of workers say they feel engaged at work – one of the lowest recorded in Europe.

In comparison, countries like the USA report triple the number of engaged employees, where 31% of workers say they feel enthusiastic about their job role. Just five countries (including European neighbours Italy and France) scored lower than the UK overall.

The findings come after labour market data found the number of people leaving the workforce due to stress or burnout increased to a record high in May 2023.

Employee feedback reflects lacklustre UK economy

“They are not happy unless they are miserable,” so goes the famous quote by Oscar Wilde about the British people. But in the current landscape, UK workers could argue a pretty good case for their misery.

Over the past two years, the cost of living crisis has hit employees hard. Real wages have fallen dramatically as a result of rising inflation, while the cost of staple household goods, including energy bills, has spiralled near out of control.

The Gallup survey reflects this bleak picture for the current mood of the UK workforce, where 19% of professionals report feeling angry at work.

This is a significant four-point increase year-on-year. It marks UK employee tempers as being in a much heightened state compared to the European average (14%).

Disengaged employees pose multiple challenges for small business owners. Firstly, there is the staff health and wellbeing concern. Raised stress levels can lead to mental health problems in the workforce and an increase in staff absenteeism.

Low engagement will also naturally impact a company’s overall productivity. When team members don’t feel motivated to finish their work, output drops. Work quality might also suffer as a result.

Healthier, happier workplaces also generally see a much lower rate of attrition. Without intervention, the UK’s army of disengaged employees will have nothing to stop them from making a swift exit, leaving behind costly hiring gaps for managers to fill.

Fewer people search for jobs in silver lining for small business hiring

In more positive news for employers, the Gallup study also uncovered that while UK employee attitudes to work have worsened, this has also dampened appetite for job hunting.

The report indicates that confidence in the UK’s current job market has declined by four points year-on-year. Just 36% of people believe that now is a good time to find a job.

Falling UK confidence bucked the trend of growing job-market confidence in the rest of Europe. Here, an estimated 56% of the population still believe now is a good time to look for a job.

There has been speculation about an impending recession in the UK. The number of planned redundancies has been creeping upwards since January, hitting its highest level since COVID-19 in March.

Against this backdrop, people may be opting to stay in their current role as this is the ‘safer’ option, rather than risk being ‘last-in-first out’ if a further recession hits.

That said, there is mounting evidence that, in light of an elevated planned redundancy rate, UK workers are still searching for alternative employment. They have simply put their plans to make the jump on hold for an opportune moment.

Research has shown that over a third of today’s workers are lining up a ‘Plan B’ career option by carrying out regular searches for job openings or cleaning up their CV.

When business confidence returns, SMEs should anticipate an upsurge in staff turnover similar to the ‘Great Resignation’ that characterised last year’s labour market.

Businesses urged to invest in benefits and perks packages to fix engagement emergency

With employee engagement at an all-time low, and indications of a second wave of resignations readying to break, Gallup experts are advising companies to act fast to turn the tide on the trend and seek out ways to boost staff morale.

Money would typically be the opening gambit for most HR managers. However, amid economic instability, employers cannot afford to incentivise their employees with sky-high wage increases.

In any case, research suggests workers would feel more motivated by bespoke perks, like learning and development opportunities or discount schemes, like Cycle to Work.

“The UK continues to perform poorly on employee engagement,” says Anna Sawyer, Partner at Gallup. “To tackle widespread disengagement, businesses need to be championing employees and giving them the right tools and resources to be productive and purposeful.

“Companies that fail to make employee engagement a priority risk losing talent and ultimately jeopardise their overall success.”

Our guide to employee benefits and perks has over 50 policy ideas to lift employee spirits (without raising pay).