What is Employee Engagement and Why It Is Important

What is Employee Engagement and Why It Is Important

No, we’re not advocating that you become an active matchmaking service for your employees. Here we look at why employee engagement is important.

Of course, we’ll take you through what is employee engagement (and we’ll ditch some stereotypes and misconceptions along the way) and then we’ll move onto looking at how to increase employee engagement (because you’ll have realised it’s not just management speak, but mighty important to productivity, innovation, your bottom line and more).


A picture of an office showing why employee engagement is important

What is employee engagement?

Before we move onto why employee engagement is important, we’re going to thrash this one out. As a term, employee engagement has been floating around in HR arenas for a while and it’s got a bit of an identity crisis going on.

There are so many misconceptions and mash-ups when it comes to talking about employee engagement that we really need to figure it out. After all, how can we measure it, understand its importance, or increase it, if we don’t really know what it is? Indeed, one review found there were over 50 definitions. Erm…

Employee engagement is about the emotional and psychological commitment that an employee has to their work with you. 

It’s found itself getting lost in wishy-washy definitions precisely because it’s trying to pin down something quite intangible: an internal state of being or mind. But the thing is, this internal state of being does directly influence and shape behaviour – behaviour which you as an employer have a vested stake in – so it’s really important. It’s the driver behind things such as your employee putting in extra effort, for example. 

It is all about things such as energy and resilience, inspiration and dedication, as well as things like concentration and pride. Engaged employees really care.

They care about what they are doing and they care about why they are doing it for you. They get something much more inherent out of the work they do than the pay cheque you deposit in their account at the end of the month. You aren’t making them work harder, do more, and go the extra mile – they simply want to.

Yeah, you want some of that!

What is employee engagement not?

Let’s throw out some things which employee engagement is definitely not. This helps to refine this psychological state so that you can see why it’s a good thing to nurture as much as you can, and indeed, helps you figure out how to do that nurturing.

Employee engagement is not job satisfaction. It’s not how good the individual feels about their daily world of work. That’s right, it’s not about how warm and fuzzy and how frankly happy an employee feels. That’s because, it’s perfectly possible for an employee to feel happy as Larry whilst doing absolutely zilch. They can be happy, without being engaged.

So, whilst you can make your employees the happiest bunnies on the block with things like freebies and fun, it doesn’t directly translate to better engagement. That’s not to say those things (and employee happiness) don’t matter, it’s just don’t kid yourself that that will increase engagement.

Similarly, employee engagement isn’t employee satisfaction. Yes, satisfaction is something that’s quite easy to measure, so it’s easy to let it jump on the engagement bandwagon, but it’s not quite the same thing. Like with happiness, a satisfied employee isn’t necessarily engaged.

She may well be satisfied enough, but when the recruiter calls tomorrow with a pay rise, she’s got no qualms about saying “hasta la vista”.


Why is employee engagement important?

The bad

An eye-watering 85% of employees aren’t engaged at work. You read that correctly. Ouch.

The vast majority of people are simply not emotionally connected to their work. They don’t give a fig. There’s some regional variation with US employees coming out much better than their European counterparts (but still it’s a pitiful minority). Indeed, the UK has some seriously worrying engagement statistics going on with only 8% of employees feeling engaged. Eek. 

With work becoming more intense and higher pressured thanks to things like technological change and increased customer demands, it’s not really surprising. But we need to do something about it.

Did you know that in the UK it costs, on average, £3000 to recruit a new employee taking 27.5 days in the process? Recruitment is expensive. And that’s before all the unseen costs, such as lost skills and the effort you’ll need to put in to get a new employee up to speed.

Engaged employees tend not to leave. It’s no surprise, given the overall employee engagement statistics, that similar numbers of people are thinking of leaving their job. Add in The Great Resignation and we don’t think it’d be too alarmist to say there’s a bit of a problem looming. 

And if we’ve not scared you enough, this hits your pocket in other ways too. Gallup revealed that for every $10,000 in salary, a disengaged employee is actually costing you $3,400. Double ouch. 

The beautiful

The flip side of this rather bleak picture is that with good employee engagement come many benefits:

  • Higher profits

It stands to reason that highly engaged employees manage to bring more into the company coffers. Organisations scoring highly on employee engagement are 21% more profitable.  

  • Higher productivity

Workplaces with engaged employees will find that more gets done. It’s not rocket science. Just think back to the last time you dragged yourself through a task you didn’t really want to do.

  • Lower absenteeism

Engaged employees fundamentally want to work. They aren’t looking for yet another way out. With higher engagement comes lower absenteeism. Indeed, 41% lower absenteeism according to Gallup. 

  • Higher morale

Employee morale has some crossover points with employee engagement, and there’s no doubt it’s in your interests to boost it. However, that’s much, much, easier to do with engaged employees. It is swings and roundabouts: one helps the other.

  • More innovation

Engaged employees are the problem-solvers, the creative innovators whose minds whir away to the beat of good and new ideas. 

  • Safer workplaces

Studies vary on their results, but there is definitely a positive correlation between how engaged your workforce is and how safe they are. Health and Safety incidents reduce when engagement goes up. The phrase ‘due care and attention’ comes to mind. Focus is easier to maintain when you’re engaged.

  • Better customer service

It’s one thing giving your employees a script to follow when it comes to interacting with your customers, but how do you get them to actually, genuinely, sing your praises in a way that’s so infectious to the listener? That’s an employee engagement thing.


An engaged customer service rep actually sounds like they think your product is the best thing since sliced bread. An engaged account manager puts in the overtime just because they can see it’s needed, without needing to be strong-armed.

An engaged manager has a little army of happy employees because his enthusiasm is contagious. You see where we’re going with this…

That discretionary effort that comes with employee engagement really is remarkable stuff.

So, is there anything you can do to actually increase this intangible emotional concept?

How to increase employee engagement

Having really got a handle on what employee engagement is and why it’s important, how can you increase it?

All good ideas need a good strategy and your strategy for improving employee engagement should look at how to increase:

  • Employee motivation

Look at both intrinsic and extrinsic motivation, but where engagement is concerned, really focus on how you can maximise the intrinsic stuff.

  • Employee identification with your organisation

How much of an employee’s identity have they got tied up in the organisation and its goals, values and mission? The more you can align the employee to the individual, the greater the levels of engagement.

  • Employee commitment

Think about how to increase the attachment that exists between your individual employees and the work they do. Do the outcomes matter to them? Do their colleagues matter to them? 

Alongside this, understand the barriers to employee engagement. It’s not a uniform beast. For example, there are distinct aspects of an individual’s personality which affect it, such as self-confidence and resilience.

But you can look at the things which are inside your control, such as job design and resources, leadership approaches and management, organisational culture and role autonomy.

Let’s take a look at some of the ways that you can increase employee engagement:


Sort out inefficiency

Inefficiency bugs the hell out of everyone. It wastes people’s time and it’s a bit rich to expect an employee to put in extra hours because the system they are working with is clunky and outdated. Prioritise efficient systems and for the love of life, stop wasting their time in meaningless meetings.

Listen and communicate

One of the most effective starting blocks to how to increase employee engagement is to ask your employees why they aren’t feeling the love. Or if that tickles your insecurities too much, reframe it to ask what you could do to increase their love.

If you don’t know what really matters to your employees (which let’s face it is what drives their engagement) then you are going to be taking a scattergun approach to fixing it.

But communication is also important in another way. Engaged employees are more likely when they feel aligned with the business and that’s impossible if they don’t know what’s actually going on. 

Nail praise and recognition

At heart, we all like a good ego massage. When we feel appreciated, valued and like what we do matters, we’ll do more of it, naturally. Our productivity goes up after a metaphorical pat on the back. 

Think creatively about ways to do this and approach it in multiple ways. For example, investing in your people through exceptional training development can actually be a great way of recognising them.

Gratitude goes a long, long way. Remember it.

Foster fabulous relationships

Never underestimate the importance of the relationships that your employees have with each other in terms of engagement. It’s these relationships that can enable high levels of engagement in even the most mundane roles. Indeed, for work to work, it shouldn’t always be about work. 

Help your employees to build relationships by taking them outside of the professional environment. Try out our Detective Days if you want an employee engagement building idea that brings lots of other benefits.

Good relationships also bring about better collaboration and when an individual realises that they are their better selves with others around, it’s really engaging stuff.

Make employee wellbeing a priority

Your employees aren’t robots. They live inside a human body with all its fallibilities and ishoos. That same body and mind is a friend, parent, partner, son or daughter… Their wellbeing at work directly affects their wellbeing elsewhere, and vice versa. You therefore have a vested interest in ensuring that each employee’s wellbeing is the best it can be. 

What’s more, showing that employee wellbeing matters makes employees feel they matter and they are cared about. And that works wonders in terms of engagement.

Employee wellbeing is a broad topic. It encompasses things like making sure the work-life balance is balanced, as well as things like sick leave policies or lunchtime yoga.

Build a company culture that people love

Never underestimate the importance of a vibrant and engaging company culture. When an individual has a choice between two jobs of the same type, even if the salary is lower at one, they will still likely choose the one where they feel they will fit in most – where the culture is best.

Partly this is because the culture is a reflection of things like values and that’s really central to engagement. If the values of the employee and the employer align then you’ve got a winning formula.

It’s also partly because even when someone is doing a task they don’t particularly relish, it’s easier to get engaged with it if they are surrounded by a support squad cheering them on, in an environment they like, and where they’ll feel appreciated for doing so.

Onboard quickly, efficiently and with care

There’s not much data on it available, but we reckon that when an employee first starts with you, their engagement levels are super-high. They want this to work, for you and for them. This can then go one of two ways.

With excellent and efficient onboarding, that highly motivated newbie will quickly become a valued team member, contributing easily, and bringing fresh energy to the table. Or, their onboarding switches them off and dulls their light. It’s a pretty pivotal moment in the employee engagement department.

Value flexibility and autonomy

There’s a direct correlation between more engaged employees and higher level roles. Looking at all the research, our summation is that these higher level roles inherently carry more autonomy and tend to offer greater flexibility, in terms of things like work-life balance.

You need to trust your employees and then they will want to give more back your way. You could force them to do their requisite hours and work to the letter of their job description. Or, you could let them have a little more flexibility and autonomy and discover that you actually get back more than you bargained for.

Give them feedback

Feedback serves many purposes when it comes to your employees, but one valuable benefit is that – used carefully and constructively – it can fuel engagement. Not only is it a chance for some lovely juicy recognition and praise which helps engagement along, but it shows employees tangible ways in which they are making a difference, and ways they can continue to in the future.

Engage by example

We know that there’s a contagious element to employee morale, and it’s kind of similar with employee engagement. Make sure managers know why employee engagement is important (and indeed what employee engagement is) and help them to be engaged.

Bolster engagement from the very top and then a top-down approach will ensure a ripple effect whereby positivity is spurred on for everyone. 

There’s also the fact that ‘the boss’ is overly influential when it comes to engagement. It’s like they are hotwired into the switch that can turn it on or off. Indeed, if we were to pick one element that’s within your control when it comes to employee engagement it’s the boss-subordinate relationship.

Make things matter

Let’s face it, not every organisation is doing anything that is fundamentally changing the world for the better. Not every role is exciting. But you still want these employees to be engaged. Things like relationships with colleagues will help, but so too will things like creating opportunities for individuals in these roles to do something impactful. 

Whether it’s a team-based volunteering opportunity helping a disadvantaged group in your local community or a company-wide fundraising effort, these opportunities can effectively hack engagement levels when the job itself isn’t overly engaging.

Put diversity and inclusion high on the agenda

It’s all about values. If diversity and inclusion is given genuine attention then you’ll find that you have more engaged workers. You could use Employee Resource Groups (ERGs) to help things along. You can build communities within the workforce which value diversity. Diversity and inclusion bring their own benefits, but they definitely help people to feel engaged.

Be the best

There’s a lot to be said for best practice. But one thing is that people really do want to work for the best of the best. They want to feel proud of their employer and proud to work for them. 

When your organisation is the leader in its sector then your employees want to stay. They want to put in their efforts for you and won’t be hooked by enticing offers from a competitor.

Be authentic

Let’s stop taking our employees for mugs. It’s a super-duper easy way of taking their engagement and lobbing it out of the window. The relationship between the employer and the employee needs to be sincere to create the right conditions for engagement to be maintained and to develop. When authenticity and trust goes, you can guarantee that engagement goes with it. 

Create a nice environment

Really, really, don’t underestimate the importance of the work environment on engagement levels. There’s bound to be greater engagement from the employee who is in a well-equipped and beautifully designed spacious office with plants and plenty of daylight compared to the poor sod hidden in the basement with a broken chair.

This extends to looking at hybrid working practices and, indeed, if you’ve got homeworkers then you really need to check that their working environment is good as it can really affect their engagement. 

There are elements of employee engagement which are outside of your control, however there are plenty of things you can do to enhance it. Don’t underestimate the importance of an engaged workforce, and remember that working on employee engagement needs to be a continual endeavour.

Want a quick tool to increase employee engagement? Treat your team to a Detective Day.


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