The Silent Tsunami: Just How Much Do Disengaged Employees Cost Their Organizations?

We’ve moved past COVID, repositioned our workers, and gotten our footing again. In this new normal we’ve learned—grown—pivoted—and realigned. With so much hard work, one would assume that engagement among employees has stabilized. Perhaps even risen? A recent Gallup report relayed the alarming news, however, that this is not the case. In fact, we have gone backwards. And organizations are paying for it.

Big. 

According to Gallup’s 2024 State of the Global Workplace report, mental wellbeing among workers is at a precarious tipping point. Sadness, anxiety, anger, stress, and worry have been on the rise over the past ten years, contributing to an increase in disengagement among employees. The cost of this crisis to America’s economy is steep: $8.9 trillion, or 9% of the global gross domestic product (GDP).  

A New Form of Disengagement

One troubling result of this disengagement epidemic: the terms “engaged” and “disengaged” are no longer enough to describe employees. Loneliness, frustration, and negative daily experiences have created a third group that is even more unsettling: actively disengaged.  

According to Gallup’s report, 15% of the global workforce is actively disengaged—not only do these employees disagree with their organization’s goals, they are in solid opposition. Why such dissent? Of this group, 54%—more than half—reported experiencing high levels of stress the prior day.  

The Cost to Good Business

Not feeling seen or heard, unclear role responsibilities, and lack of support are just a few of the pressure-inducing situations employees described in the report, and these taxing workdays more often than not affected the employees’ home life. Behind the staggering costs of the disengagement epidemic lies a toxic brew of negative emotions: 

• Lowered morale - Overwhelmed by workday issues, employees arrive home exhausted and edgy.  

• Ineffective communication - Unclear information leads to confusion and overlapping efforts. 

• Hampered collaboration - Feeling like their opinions don’t matter, workers keep their ideas to themselves. 

• Increased absenteeism - Not wanting to face the day, employees choose to stay home. 

• Mistakes - Distracted, team members experience slip-ups that are often costly. 

• Quiet quitting - A perceived lack of resources stifles ideas and growth.  

It’s no surprise that disengagement shatters retention, customer service, and more, resulting in a decreased bottom line. The siren has sounded. What can companies do? 

There Isn't an App for That

Obviously, the decline in workers’ wellbeing has moved far past being a “feel-good” issue: advising employees to download an app or take stress management training is a lightweight solution where more permanent change is needed. And, as Gallup points out, a recent Oxford University study found that these too-little-too-late interventions may even do harm. 

What lies at the heart of this engagement downslide? Shockingly, (or perhaps not), the problem can be traced to an organization’s own people: leaders and managers who are unwilling, or unable, to do their jobs effectively. In fact, the Gallup report showed that employees working under bad management reported experiencing stress 30% more frequently than those who were not employed at all.  

Good News Exists

The good news is that employers can stop the tidal wave of low disengagement by equipping leaders with the skills they need to recognize and address disengagement. This results in more engaged employees, better supported managers, and stronger business outcomes. This cascading effect was demonstrated in Gallup’s report, showing that best practice organizations boasted engagement in three-fourths of managers and seven out of ten non-managers.

In the coming months, our blog will examine the disengagement epidemic further. We’ll explore engagement efforts that promote change, key leadership behaviors that cultivate engagement, and how to recognize and reactivate disengaged leaders.  

Don’t become a part of the epidemic. If you need help turning the tide of disengagement within your own organization, get in touch with us today.