Employee Engagement ROI: The Cost of Disengaged Employees [Calculator Included]

Concerned you have an employee engagement problem? Use our Disengaged Employee Cost Calculator below to see how much it's costing your business!

Employee Engagement ROI: The Cost of Disengaged Employees [Calculator Included]

Have you ever wondered how much a disengaged employee is costing your business?

Disengaged employees cost the UK economy a staggering £340 billion a year. This is an accumulation of productivity, recruitment spend and so much more. 

Poor engagement can impact employee productivity, cause you to lose your best talent, as well as stop you from attracting top talent.

On the flip side, an engaged workforce has several benefits. Engaged employees are 21% more productive than their peers and are 87% less likely to leave their current employer. Of course, this requires investment and careful planning. 

In this blog we will show you the real world cost of disengaged employees within your organisation and the benefits an engaged workforce will bring. 

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Why is Employee Engagement Important?

Organisations are still continuing to struggle to engage their workforce. Even with 20 plus years of employee engagement awareness, why is this? In July 2017, just 41% of UK employees feel aligned with their organisations’ goals, and 36% of employees are likely to leave their jobs within one year because they’re so engaged.


Recommended Reading 📖: Employee Engagement: The Ultimate Guide 2021


Benefits of Having Engaged Employees

Whilst there are several negatives of a disengaged workforce, plenty of positives are to be had with an engaged one.

Here are a handful of benefits of employee engagement: 

1. Increased Productivity 

An engaged employee is proven to be 21% more productive than their peers. 

That means that a workforce of five will produce the equivalent of one extra member of the team. When put in those terms, it is clear to see that investment into employee engagement can indeed be a cost saving measure.

2. Increased Profits 

A higher output will naturally result in higher revenue. A Gallup study found that engaged employees result in a 23% increase in profitability. When employees want the business to succeed, they will work towards making the business better. 

It goes to show that if you invest your time and resources wisely into employee engagement you will see significant ROI. 

3. Lower Staff Turnover 

The expense of recruiting a new member of staff goes beyond just salary. An Oxford Economics report found that it costs an average of £30,164 per employee. 

According to Gallup, highly engaged businesses enjoy 59% less turnover. Retaining your staff cuts down on lost output, recruitment and onboarding costs. 

This is another example of how shrewd investment into your employee engagement strategy will demonstrate significant ROI in the longer term.

4. Significantly Fewer Sick Days Taken

Thriving employees miss 53% less days as a result of health related issues. Disengaged workers are generally more stressed. This causes anxiety, depression and a host of other mental and physical illnesses. 

As a result of the stress felt by employees and subsequent illness, days will be lost. Output will suffer through absences and will have a direct impact on the bottom line of the business. 

Take that stress away and you will notice a marked difference in the number of sick days. 

5. More Employee Participation

Do you yearn for your workers to get involved in discussions and meetings more often? Effective employee engagement can help you achieve this. 

Engaged employees reduce absenteeism at work by 41%, resulting in better collaboration and more aligned workers. Given their familiarity with the business, they can offer some of the best suggestions to take it forward.


Recommended Reading 📖: Why Is Employee Engagement Important? [Key Benefits]


The Real Cost of Employee Engagement 

The pandemic has caused widespread economic instability and organisations are cutting costs. But when this has a direct impact on employee engagement, the bottom line will be adversely affected. 

Employee disengagement costs organisations an estimated £340 billion in the UK and an eye watering $483-$603 billion per year in the US. 

A disengaged employee costs an estimated 18% of their annual salary. For example, one unengaged worker on an average salary of £30,000 will cost you £5,400.

Now, Globally, 67% of the workforce is not engaged. So in a company of 10,000 employees with an average salary of £30,000 each, the cost of their disengagement is £60.3 million annually. 

This begs the question of whether cutting your engagement tools will cost you far more than it saves. 

 

Employee Engagement ROI Calculator

Our Employee Engagement ROI Calculator is designed to quantify the financial impact of disengaged employees in your business. 

This will show the true cost of disengaged employees based upon average salaries and size of the workforce. 

Please note that figures are based on research carried out by Gallup around the subject of employee engagement. Figures are estimates only. 


Concerned you have an employee engagement problem?

Check out our blog on how to start your employee engagement action plan today.


 

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