- Employees with lower wellbeing were more likely to change jobs in 2021
- Through turnover, the financial cost of low wellbeing is considerable
- Organizations can improve employee wellbeing, starting with six steps
Employees who were struggling or suffering in their lives this past March were about twice as likely to change jobs later in the year than those who were thriving. This finding poses significant management demands for organizations and has major financial implications for them going forward.
The labor market in 2021 has given most employees the opportunity to look for alternative employment if their current work situation isn't improving, or is contributing to the deterioration of, their overall lives. The Bureau of Labor Statistics has continued to report record increases in quit rates through the fall of 2021 -- leading to the "Great Resignation."
Gallup has also found that employees who are not engaged or are actively disengaged in their work and workplace are most likely to be those who are actively looking for a new employer and watching for openings.
The labor market in 2021 has given most employees the opportunity to look for alternative employment if their current work situation isn't improving, or is contributing to the deterioration of, their overall lives.
Gallup recently reported high levels of employee burnout, even rising to new highs for managers. Manager burnout poses a particular and significant problem, as managers have the greatest impact on the engagement of the millions of teams across organizations.
There are many possible causes of burnout, but a fundamental contributor is when the demands of work are not complemented by a thriving overall life.
Even among those who are engaged at work, burnout is highly probable if employees are struggling or suffering in their lives. With the unprecedented shift during the pandemic in how -- and where -- work is done, the lines between work and life are more blurred than ever.
In March, Gallup surveyed a random sample of 10,937 full- and part-time U.S. employees, including measurement of the Gallup Net Thriving wellbeing index. Fifty-nine percent of all employees were "thriving" in March -- rating their present life a 7 or higher and their future life an 8 or higher on a zero-to-10 scale. Those who are not thriving are categorized as "struggling" or "suffering." Gallup tracked the employment status changes of employees from March to October of this year.
who left job between
March and October
|Struggling/Suffering employees who left job between March and October|
Employees who were struggling or suffering in their overall lives in March were nearly twice as likely to report that they had since changed jobs in October, at 22%, compared with 12% of those who were thriving in March. Across job categories, those who were thriving reported fewer job changes than those who were struggling or suffering.
The largest differences were in production/front-line jobs, healthcare/social assistance and managerial/executive positions, where thriving employees in March had much lower percentages of job changes.
Implications for Organizations
Employee wellbeing has a financial impact on organizations through the cost of turnover. The differences in turnover rates between thriving and struggling or suffering employees relate to large cost-of-turnover differences. For example, for every 1,000 production or front-line employees hired, the turnover differences represent 200 employees per year, or conservatively $3.3 million. For healthcare employees, the difference of 17 percentage points in turnover represents 170 employees per 1,000 hired or approximately $6.8 million in turnover costs.
Employee wellbeing impacts your organization's reputation and brand. Seventy-one percent of employees who strongly agree that their organization cares about their wellbeing strongly advocate for their organization as a place to work, compared with only 12% of employees who do not strongly agree.
Employee wellbeing impacts the resiliency of your workforce. Employees with higher wellbeing have lower levels of burnout, diagnosed anxiety and depression and have lower disease burden costs.
Your organization can impact the overall wellbeing of employees. The percentage of employees who strongly agree that their organization cares about their wellbeing varies across companies in Gallup's database -- from 30% to nearly 90%. Gallup Net Thriving can vary by as much as 70% across employees based on variance in what Gallup has discovered are the five key elements of wellbeing: career, social, financial, physical and community.
Wellbeing is additive to employee engagement. In additional study findings, Gallup found that employees who were engaged but struggling or suffering -- as well as those who were thriving but not engaged or actively disengaged -- had a 14% annualized turnover rate. Those who were neither thriving nor engaged had a 24% annualized turnover rate. And those who were both thriving and engaged had an 8% annualized turnover rate.
What You Can Do
- Start by getting the fundamentals of career and social wellbeing right through employee engagement. Getting aspects of work right -- such as setting clear expectations and providing the right materials and equipment, opportunities to use strengths, recognition for good work, opportunities to develop, and a common purpose, for example -- builds trust. And trust opens the door for more in-depth wellbeing discussions and resources.
- Use Gallup's five elements of wellbeing as a science-based organizing structure for your benefits and wellbeing programs and offerings. Clearly communicate how each offering and wellbeing element (career, social, financial, physical, community) builds net thriving and reduces struggling or suffering.
- Communicate the purpose for building a "net thriving" culture -- first, through the CEO's office. Culture change is an outcome of the expectations and messages that top executives consistently send -- through their words and actions.
- Equip managers to include wellbeing as part of performance management. Employee development plans should include wellbeing goals. This does not mean managers should play the role of financial adviser or life coach. It means they should integrate wellbeing conversations into their management practice and ongoing coaching.
- Develop a network of wellbeing coaches who collect and share best practices. Find and develop experts in each of the five wellbeing elements to provide the best advice.
- Audit your practices and policies. Study which practices and policies are used and to what extent they increase net thriving and reduce struggling or suffering.
Improve employee wellbeing in your workplace:
- Learn the cost of low employee wellbeing and how Gallup can help.
- For practical wellbeing advice, read Wellbeing at Work.
- Find out what causes burnout.
Sangeeta Agrawal contributed analysis to this article.