Low Employee Wellbeing and Engagement Hurt German Companies
Business Journal

Low Employee Wellbeing and Engagement Hurt German Companies

Struggling and disengaged workers exact a heavy toll in illness and missed workdays

Low rates of wellbeing among employees, along with low engagement rates, are hurting German businesses, according to Gallup research. About half of the workers in Germany (47%) rated their lives highly enough to be considered thriving, while 47% say they are struggling, and 5% are suffering.

The Three Types of EmployeesGallup categorizes individuals' overall wellbeing as "thriving" (strong, consistent, and progressing), "struggling" (moderate or inconsistent), or "suffering" (at high risk). People who have thriving wellbeing are better off in every way that matters. They have good health, are integrated into the community, enjoy meaningful and rewarding work, have sound finances, and meet with friends frequently. Their wellbeing affects their workplaces as well.

Gallup's employee engagement measure classifies employees as engaged, not engaged, or actively disengaged based on responses to 12 elements with proven linkages to performance outcomes that reflect basic human needs and expectations in the workplace. When these needs are met, employees can become engaged, or psychologically committed, to their workplace. (See "The Three Types of Employees.")

The costs of low engagement and wellbeing

Employees who are engaged and thriving are agile and resilient; they are involved in and enthusiastic about their work and rate their current wellbeing as strong, consistent, and progressing. At the other end of the spectrum, employees who are actively disengaged and suffering are emotionally disconnected from their work and workplace and rate their current wellbeing at high risk.

Engagement and Wellbeing Among German Workers

Business leaders should pay close attention to the engagement and wellbeing of their workers, because both have real effects on their business. Engaged workers with high levels of wellbeing are sick less often; as a result, they cost their companies less in lost work and paid sick leave. Employees who are engaged and thriving have the lowest number of absenteeism days due to illness. On average, employees who are engaged and thriving miss 3.9 days of work per year. That's almost three times lower than the absenteeism of those who are actively disengaged and suffering, who miss an average of 10.7 days of work per year.

Engagement and Wellbeing Affect Absenteeism

Those lost workdays come with a heavy price tag. Each day of employee absence costs a company in Germany 275.20 euros, according to the Frankfurter Allgemeine Zeitung. For employees who are actively disengaged and suffering, the average annual per-person cost of absenteeism due to sick days is 2,945 euros. For employees who are engaged and thriving, the average annual per-person cost of absenteeism due to sick days is 1,073 euros, which represents a cost savings of 64%.

Feeling the effects of stress

One of the factors that can affect employees' physical health is stress. When Gallup asked respondents if the stress of work caused them to feel burned out in the past 30 days, about one in three German workers answered "yes." And when asked to rate their level of agreement with the statement "At work, I am increasingly expected to deliver more in the same amount of time," 24% of German workers strongly agree; 18% strongly agree that they often feel rushed at work.

Actively disengaged workers are more likely than engaged employees to say that they felt burned out due to work stress in the last month (50% versus 16%), that they were expected to deliver more in the same amount of time (40% versus 13%), and that they often feel rushed at work (31% versus 7%).

Engagement and Stress

Clearly, it's in a company's best interest to keep its employees engaged and healthy. But only 29% of German workers strongly agree with the statement "My organization cares about my overall wellbeing"; 26% strongly agreed with this statement in the previous year.

By targeting the five elements of wellbeing -- Career, Social, Financial, Physical, and Community -- leaders can transform their companies into high-performing workplaces where employees thrive. Companies that actively track, manage, and enhance employee engagement and wellbeing can reduce costs by lowering absenteeism and increasing productivity, while attracting and retaining top talent to their improved working environment.

An East-West Divide in Engagement and Wellbeing

More than two decades after German reunification, life seems distinctly different for workers living in the East than it is for those living in the West. The percentage of employees who are actively disengaged is higher in East Germany than in West Germany. An East-West difference is also visible in terms of wellbeing. In the western part of the country, 50% of workers are thriving, compared with 33% of those living in eastern Germany.

Differing incomes are likely a major contributing factor in these regional differences. Thirty-four percent of workers living in the West strongly agree that they're paid appropriately for the work they do, while 22% of the workers in the East share this view. According to the Statistische Bundesamt, workers in West Germany earn 3,350 euros per month on average, while workers in East Germany earn 2,547 euros per month.

It's important to note that employees work an average of 35.6 hours per week in the West and 37.1 hours per week in the East. However, according to the working group "Volkswirtschaftliche Gesamtrechnungen der Länder," labor productivity (based on GDP) is significantly higher in the West than in the East: The West contributes 88.9% to the gross domestic product of Germany, while the East contributes 11.1%.

Engagement and Wellbeing in Germany: An East-West Divide

Wellbeing Categories

Gallup classifies respondents' wellbeing as thriving, struggling, or suffering according to how they rate their current and future lives on a ladder scale, with steps numbered from 0 to 10 based on the Cantril Self-Anchoring Striving Scale. People are considered thriving if they rate their current lives as a 7 or higher and expectations for their lives in five years as an 8 or higher. People who rate their current or future lives as a 4 or lower are classified as suffering. All others are considered struggling.

Survey Methods

Results are based on telephone interviews conducted from Oct. 25, 2010, to Nov. 18, 2010, with a nationally representative sample of approximately 1,920 employed adults, aged 18 and older; and from telephone interviews conducted as part of the Germany Gallup-Healthways Well-Being Index survey from Oct. 4, 2011, to Dec. 30, 2011, with a random sample of approximately 1,323 employed adults; and from Aug. 1, 2012, to Dec. 21, 2012, with a random sample of approximately 2,198 employed adults. All respondents were living in Germany and were selected using random-digit-dial sampling. For results based on the total sample of national adults, one can say with 95% confidence that the maximum margin of sampling error is ±1.0 percentage points.

Interviews are conducted with respondents on landline telephones and cellular phones. Samples are weighted by gender, age, education, region, adults in the household, and cellphone status. Demographic weighting targets are based on the most recently published data from the German Statistics Office. All reported margins of sampling error include the computed design effects for weighting and sample design. In addition to sampling error, question wording and practical difficulties in conducting surveys can introduce error or bias into the findings of public opinion polls.

For more details on Gallup's polling methodology, visit www.gallup.com.

Marco Nink is a Senior Practice Expert at Gallup.
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