Keeping your employees engaged is critical for productivity and growth, but without starting at the source, your goals are unreachable. Combatting declining manager engagement is critical to your employee engagement strategy and bottomline.
Maria Valero
Editorial Strategist, HR
Workday
Dropping employee engagement rates cost the world economy $438 billion in lost productivity in 2024, according to Gallup.
The primary cause? Declining manager engagement.
If a manager isn’t engaged, it’s safe to assume that affects the engagement of their direct reports. And this is costing companies—big time.
Organizations that tackle this challenge can reap large returns. Discover what’s causing a decline in engagement rates and how to combat these issues before they impact your organization’s bottom line.
Report
Only 27% of managers are engaged at work.
This is a stark reality that is a painful truth for HR professionals to hear, and even more so for the employees who report into those disengaged managers.
Given how much is on their plate at any given moment, and how it can take away from their ability to perform the “people” parts of their titles and scope, it’s no wonder managers are struggling to come up for air. Competing priorities can make it difficult to focus on managing their own responsibilities, much less finding time and bandwidth to support their teams.
But if we don’t solve the manager burnout problem, we’ll never solve the employee burnout and engagement problem. While manager engagement is declining and currently at 27%, individual contributor engagement is even lower at 18%.
Gallup confirmed this interdependent relationship when digging into the data and observing that countries with less engaged managers are more likely to have less engaged individual contributors.
Only 27% of managers are engaged at work.
It’s nearly impossible to talk about employee engagement without talking about burnout.
Employee experiences are largely made up of interactions that employees have with managers and their organizations, both of which are large drivers in employee burnout risk.
Our 2024 Workday Voice of the Employee report identified burnout risk drivers as a combination of management and organizational support, such as:
Organizational support: Whether or not someone feels the organization cares about their mental health (Rated 4 points lower for employees at high risk of burnout)
Equipment and resources: Whether or not someone has the right materials and tools to complete their work (Rated 2 points lower for employees at high risk of burnout)
Management support: How direct reports rate the overall level of support they receive from their manager (Rated 2 points lower for employees at high risk of burnout)
Management care: Whether or not someone feels their manager cares about them as an individual (Rated 2 points lower for employees at high risk of burnout)
Management openness: Whether or not someone’s manager communicates with them openly and honestly (Rated 2 points lower for employees at high risk of burnout)
HR teams have a big role to play in bridging the engagement gap that their workforces are facing. The return on investment in solving these challenges is a helpful tool to position the HR function as a value-generator for their organizations, and a trust builder for the employees that will reap the benefits.
Higher burnout risk is directly correlated with lower employee satisfaction in both management and organizational support.
It’s no secret: AI is intimidating. Most workers have a basic understanding of what AI is and a theoretical understanding that it can help them, but the how is still unknown to many.
The prospect of AI’s impact on work is equally exciting as it is unpredictable. With so many unknowns around this technology and how it will affect our futures, it’s understandable that there may be a level of hesitancy in the workplace right now. Managers are already overwhelmed with existing workloads, so expecting them to wrap their head around this new, intimidating technology that is set to disrupt the future of work is a tall ask.
Combatting AI’s reputation on this front can be beneficial in order to positively influence employee perceptions–and it’s within HR’s control to do so.
Change management efforts within organizations that are implementing AI or that are heavily affected by AI’s impact are critical. AI has a reputation, and if change management teams don’t manage its reputation like a PR team, negative perceptions about AI can run rampant.
The takeaway: Don’t underestimate the power of a positive spin on AI.
This is a big one. While everyone is probably getting AI-fatigue and trying to avoid AI, it’s actually time to do the opposite. Lean into the discomfort of not understanding something and close the knowledge chasm so that your workload (and stress levels) can reap the benefits that this new technology promises.
Manager training on how to leverage AI to offload administrative tasks from manager’s plates and free up time for more meaningful aspects of their scope is no longer an option, it’s an imperative.
Declining manager engagement rates may have more to do with the advancement of AI than we may think. With the advancement of this technology, business expectations are rising. And with AI still a largely untapped resource, this leaves little to no light at the end of the tunnel. As AI usage increases, this may change. Why?
While yes, it is a learning curve at first, AI is enabling managers to become people managers again. Freeing up time to engage in the experiences direct reports are having at work helps the business three-fold: Improved employee experiences means increased engagement. Increased engagement means more productivity. More productivity means higher business results.
Gallup estimates that if the world’s workplace was fully engaged, $9.6 trillion in productivity could be added to the global economy–this is 21 times higher than the productivity deficit from last year’s drop ($438 billion).
AI is enabling managers to become people managers again.
With the world of work shifting so significantly at such an accelerated rate, so should leadership training. Manager development and enablement initiatives should not be a static, one-and-done programs anymore–they need to be as agile and dynamic as the business landscape.
What was relevant five years ago in a leadership development course may not be relevant to the current realities of managers and their teams. Providing up-to-date, timely, and applicable leadership training that takes into account the shifts HR teams are undergoing is critical.
Leadership training should hone in on:
How leaders can help their organizations and direct reports as they shift to a skills-based approach.
How leaders can remain connected to their teams and create a strong coaching relationship built on a foundation of trust.
How to leverage AI to significantly reduce time to completion on a project, hand off administrative tasks, and increase bandwidth for more strategic tasks.
And the need for dynamic leadership training support for managers doesn’t stop at the variety of training offered.
Of the 27% of managers who are experiencing a three percentage point decline in engagement compared to the year prior, managers under 35 and women have been disproportionately affected–falling by five and seven percentage points, respectively.
Leveraging data to dial into the different segments of managers within your organization to understand how their unique experiences are affecting their engagement at work is critical to making an impact.
Expectations that engagement is at 100% for all employees, all the time is not attainable. But finding ways to support your people wherever they are is.
As HR leaders and managers prepare their workforces and teams for the next era of work, it’s important to consider the human elements of the employee experience. Without the right management support and engagement, employees and organizations alike will never be able to realize their full potential.
For more insight on the engagement levels of employees and the factors that affect burnout, read Workday’s 2024 Voice of the Employee report.
Report
A gap between effort and impact is the real ROI problem. Discover the solution.