A fall in global workplace engagement is estimated to be costing the global economy $438 billion in lost productivity, according to research from Gallup.
Gallup’s annual global study found that the percentage of engaged employees fell from 23 percent in 2023 to 21 percent in 2024. Researchers said that the two-percentage point drop in engagement was equal to the decline recorded during the Covid-19 lockdowns in 2020.
Researchers said managers are the trigger for the fall in engagement as their own workplace engagement fell from 30 percent to 27 percent in 2024.
The findings, published in the State of the Global Workforce 2025 report, highlight that the manager employee relationship is so strong that it shows up in country-level data.
“Countries with less engaged managers are more likely to have less engaged individual contributors. If manager engagement continues to decline, it won’t stop with managers, and it won’t stop with engagement. The productivity of the world’s workplace is at risk,” the report said.
Anna Sawyer, principal partner at Gallup, said: “When managers are disengaged it rapidly cascades through to their team.”
The data showed two types of managers were particularly affected. Engagement among managers under 35 fell by five percentage points and female manager engagement dropped by seven points.
Managers are on the front line of seismic changes in the workplace as the post-pandemic world continues to evolve and embrace AI.
The report said that in the past five years, a typical employer, and therefore their managers, have experienced disruption at every level. This includes post-pandemic retirements and turnover, a hiring boom and bust, rapidly restructured teams and departments, shrinking budgets, disrupted supply chains, new customer expectations, ongoing digital transformation and incorporation of AI, as well as new employee demands regarding flexibility and remote work.
“Managers across the world have found themselves really caught at that intersection of various leadership directives and very rapidly evolving employee expectations,” Sawyer said.
“At the same time, organisations working to respond to disruptions from numerous different angles have found themselves strapped for key resources as budgets have shrunk in the wake of pandemic stimulus packages ending. And of course, the availability and ability to hire new talent has ebbed and flowed, [while] new technologies being introduced are creating totally different ways of working at very rapid speeds.”
Sawyer added that some of Gallup’s other research has indicated that there is “a very severe lack of readiness” to respond to some of those different ways of working, so organisations are restructuring.
“[Employers] are rethinking the design of their teams, and that constant push and pull around flexibility and remote working remains a very high priority for leaders and employees alike. All of these contributing factors are taking a very significant toll on managers, and that, in turn, has the implications on productivity across global organisations.” she said.
UK results compared with Europe
Drilling down into the results for regions and countries, the data for Europe revealed that this region has the lowest percentage of engaged employees at 13 percent, well below the global figure of 21 percent.
Comparing engagement results across 38 countries in Europe, the UK ranked 30th with just 10 percent of employees engaged. The bottom three countries for engaged employees were France, Switzerland and Croatia with 8 percent, 8 percent and 7 percent respectively.
The UK had the second highest percentage of workers reporting they felt sad at work with 26 percent. Only Northern Cyprus had more employees (35 percent) reporting this sentiment.
Data on employee anger at work showed that the UK ranked 13th out of 38 countries with 16 percent agreeing they felt angry at work. Countries with the most employees reporting workplace anger were Northern Cyprus (49 percent), Montenegro (27 percent) and Slovakia (24 percent).
The UK also ranked 13th for employees reporting daily stress, with 41 percent. Northern Cyprus ranked top for the highest percentage of employees reporting stress (65 percent), followed by Greece and Malta (59 percent and 58 percent respectively).
However, when it came to employees reporting that they are thriving at work, the UK was ranked in the top half with 46 percent of employees saying they are thriving at work. But this is two percentage points down from the previous year.
Nebel Crowhurst, chief appreciation officer at Reward Gateway Edenred, said: “It comes as no surprise that British workers are amongst the saddest and most disengaged in Europe. Recent research from Reward Gateway found that employers in the UK are suffering from an appreciation crisis, with women and those in large organisations specifically suffering the most. It’s clear from today’s Gallup report that for the UK employees’ outlook to improve, businesses must adjust their wellbeing and HR strategies.
“The [Reward Gateway] results of employees feeling more appreciated are there for all to see. The report found appreciation to be a key driver of workplace success, with 88 percent reportedly working harder, 73 percent taking on extra work, and 91 percent feeling more engaged, all as a direct result of feeling more appreciated. This report showed that appreciation is not just an effective strategy for fostering employee happiness, but also a smart investment that leads to increased productivity, thereby enhancing overall business results. While businesses cannot control external factors, they are able to dictate what happens within their teams, and they should ensure they take advantage of this.
“Also raised in today’s Gallup report was that stressed-out managers are cited as the primary cause for fall in employee engagement. Stress and its impact on employees is not a novel phenomenon, though this may be a driver of why it’s been normalised in the workplace. There is a general expectation that employees must ‘carry on’ with their work despite experiencing declining mental health and symptoms of burn-out like detachment, irritability and exhaustion. While younger generations are being more mindful of mental wellbeing, businesses need to make this a priority in their workplaces.
“Stress creates a dampener on workplace culture, and more importantly, tears down employees and their mood, productivity and motivation to try harder and do better. Especially within the UK amidst the push to ‘Get Britain Working Again’, it’s crucial organisations take initiatives to make stress-free workplaces, so employees actually look forward to cracking on with their work.”
