Updated: November 07, 2022

The Importance of Employee Engagement & 7 Benefits

This is a guide to the importance of employee engagement and a list of employee engagement benefits.

Employee engagement is the idea that workers perform better when they have a positive relationship with their coworkers and employer and feel a sense of purpose in the work. The practice is important because engaging employees yields many benefits to team members, managers, clients, and the organization as a whole.

Related ideas include the theory of employee engagement, employee engagement best practices, staff engagement strategies, and activities for employee engagement.

This article covers:

  • Why is employee engagement important?
  • Why is employee engagement important to a company’s success?
  • The importance of employee engagement and retention
  • Why is employee engagement important in remote work?
  • employee engagement benefits for customers
  • employee engagement benefits for employees
  • employee engagement benefits for managers
  • employee engagement benefits for organizations

Here are the basics.

Why is employee engagement important?

Adults typically spend one third to one half of their waking life at work. Most folks want that time to be meaningful. Professionals seek out fulfilling work, occasionally by switching jobs in search of more enriching environments. Staff that stays is not necessarily doing the company any favors, though; disengaged employees are likely to underperform and spread dissatisfaction, and may increase the workload and discontent of colleagues.

The importance of employee engagement reaches far beyond the individual worker, affecting all areas of a business, including clients, coworkers, and managers. Attitude is contagious, and enthusiastic employees improve the experience of all parties. Employee engagement is not only about avoiding negative outcomes, but making a positive impact. Employees in engaged workplaces enjoy better physical and mental health, form deeper relationships with colleagues and clients, immerse themselves in the work, and enjoy the day-to-day happenings and achievements of the office.

Motivated employees send shockwaves through the rest of the organization. Businesses with engaged employees report greater customer satisfaction, lower absenteeism and overtime, fewer safety incidents, decreased staff turnover, stronger company culture, and a boosted bottom line.

See more statistics and facts related to employee engagement and the benefits of employee happiness.

Why is employee engagement important to a company’s success?

A company consists of teams and individuals functioning collaboratively to meet a common goal. Every employee contributes towards the company’s victory. While talent is useful, passion is what truly drives progress. Employee engagement measures give the staff the momentum needed to excel and exceed expectations. Committed employees have an intrinsic motivation to improve their environment and their own performance. When every employee deeply cares about the organization and invests in the mission’s outcome, a company is sure to achieve favorable results.

Here is a list of best practices for employee motivation.

The importance of employee engagement and retention

Workers spend a whopping forty hours a week, at minimum, on the job. Nobody wants to feel bored, stressed, ignored, or unfulfilled for roughly one third of conscious life. Positive feelings for the organization, regard for colleagues, and passion for the work make the day pass much faster and more pleasantly.

More than that, employees long to feel supported, challenged, and connected to the company. A teammate chooses to work for a business not only to further the organization’s goals, but also to further the teammate’s career and individual sense of purpose. An unfulfilled employee may seek opportunities elsewhere. Leaders should remember that not only do employees serve organizations, but organizations should serve employees. Taking that responsibility seriously means showing an interest in the employee’s general wellbeing and professional development.

For more information on retaining talent, you can check out this guide to employee retention strategy.

Why is employee engagement important in remote work?

Remote workers report feeling disengaged and disconnected much more often than in-office counterparts. The solitary nature of virtual work can mean that employees interact primarily with a computer screen, not colleagues. When employers do not meaningfully engage with employees, telecommuters can begin to feel more like contractors plugging away at a laptop instead of valued members of collaborative organizations.

Yet not all work from home employees log in and check out. In fact, many online organizations successfully create fun and captivating web-based cultures that inspire and motivate team members to consistently perform at high levels. These remote organizations achieve maximum engagement by building camaraderie through methods such as virtual hangouts or remote team building activities, maintaining constant communication and soliciting regular feedback, and providing all necessary tools and resources.

Building a close-knit community and a consistent company culture is more of a challenge in virtual workplaces than traditional offices, but is achievable with care and strategic planning. Leaders must be mindful and intentional about remote engagement, especially since limited interactions mean fewer opportunities to forge meaningful connections.

For tips and ideas on energizing a virtual workforce, check out our post on virtual employee engagement ideas.

List of employee engagement benefits

From improved customer experience to increased productivity to reduced employee turnover, here is a list of positive outcomes that make employee engagement measures worth the time and effort.

1. Reduced employee turnover

One of the main employee engagement benefits for organizations is lower turnover rates. Finding and hiring new staff costs over $4,000 per employee, on average, according to the Society for Human Resource Management. Multiplied by several employees, costs add up quickly. Time and money spent on constant recruiting are resources that could be better used improving other areas of the organization. Thus, improving employee retention rate is in a company’s best interest.

Employees invested in the work, connected to colleagues, and appreciated for efforts are less likely to switch companies. After all, job hopping is a gamble for employees too, and most staff are hesitant to trade a fulfilling position for an uncertain future.

Here is a guide to staff turnover.

2. Improved customer experience

We all have a story or two about interacting with a worker who was obviously less-than-thrilled about the job. Perhaps a customer service representative snapped at us during a phone call. Or a retail worker scowled and texted the whole time we browsed the store. Maybe our doctor responded to our questions with one word answers. Perhaps our experience was not so hostile, but rather flat, dull, or sparkleless. Every worker has the occasional bad day, but disengagement means repeated poor experiences for the customer.

On the other hand, exceptional interactions stand out for positive reasons. I remember hearing a story about a waiter who walked across the street to a vending machine to purchase a Coke for a customer who was distraught that the restaurant only served Pepsi. The waiter received a hefty tip, and the restaurant gained a regular. Perhaps your veterinarian sends your pet a personalized birthday card, or a salesman drives a long distance to personally deliver a product when we are on deadline. Examples of exemplary customer service stick in our minds for years, and often make us loyal fans of brands. Yet only engaged employees go above and beyond to manufacture these instances.

Memorable encounters are one of the main employee engagement benefits for customers. Disengaged employees do the bare minimum, but engaged employees go the extra mile to deliver exceptional service. An engaged employee can turn a transaction into an experience and provide a client with additional value at no added cost.

Check out this list of books on customer experience.

3. Increase in employee autonomy and initiative

Engaged employees take initiative. Passionate folks seek out ways to improve the organization and personal performance. Without waiting for explicit instructions, these individuals propose solutions to challenges, brainstorm fresh systems and approaches, and put forth maximum effort. While these staff members still defer to the judgment and direction of the team leader, the leader’s most frequent feedback is “keep up the great work!”

A self-directed work style is one of the key employee engagement benefits for managers. Engaged employees are self-starters. Love of the job motivates these teammates to excel. Managers do not need to dole out orders or criticism, because a commitment to clients, colleagues, and the company spur staff to take positive action. This phenomenon frees up leaders to focus on executive responsibilities instead of spending the bulk of the time coaching or cajoling employees.

4. Greater job satisfaction

Greater job satisfaction is one of the most noticeable employee engagement benefits for employees. Most professionals spend at least forty hours a week at work. At the very least, that time should be tolerable, and ideally, the time should be enjoyable. Because work constitutes such a large portion of a worker’s life and modern identity, greater job satisfaction can lead to greater life satisfaction.

Workplace engagement makes employees excited to come to work. These workers view obstacles as challenges to overcome, not struggles to endure. Committed team members view coworkers and leaders as collaborators and allies. Staff feel seen and supported, meaning less everyday stress and more risk-taking that can lead to positive rewards.

Plus employee engagement is a chain reaction. Enthusiasm is contagious. Respected and well-treated employees exude positive attitudes and exemplify teamwork, creating a more pleasant work atmosphere that produces even more engagement.

Here is a list of quotes about job satisfaction and job satisfaction data and facts.

We also have a list of ways to improve job satisfaction for employees.

5. Better relationships

Attitude plays a big role in magnetism. Folks rally around passionate and positive people because these individuals make others feel happier, hopeful, and empowered. Engaged employees cultivate more robust work relationships, and healthy work relationships lead to greater levels of engagement, making employee engagement a circular process.

Better relationships are both employee engagement benefits and catalysts. Committed and motivated employees are more dependable and cooperative. Teamwork is strong in organizations with high levels of employee engagement, because staff has a mentality of “we are all in this together,” vs “every man for himself.” Engaged workers are more conscientious, considerate, and cooperative, leading to more positive interactions between coworkers.

Fulfillment at work has a ripple effect on non-professional relationships too. Decreasing or properly managing work stress eliminates strain on friendships and family, improving connections across all life facets.

Check out this list of relationship building activities.

6. Higher levels of safety

A Gallup poll found that organizations scoring in the top 25% percentile of employee engagement experienced 70% fewer workplace safety incidents. According to Harvard, engaged employees pay closer attention to the immediate environment and take steps to protect coworkers. For instance, a conscientious teammate may point out potential dangers in the workplace and propose solutions, or might respectfully remind coworkers to follow a safety procedure. Meanwhile, a disengaged employee may not possess the attention or energy needed to notice or remedy workplace hazards. Engaged employees care about the long-term health of colleagues and the company, and thus are more likely to detect and speak up about potential dangers.

7. Increased profitability

All the factors on this list combine to build a better bottom line for the company. While organizations care about the health and happiness of employees, leaders have a responsibility to maintain and grow profits and secure a future for the company. The business world does not allow companies to continue operating on the basis of employee treatment alone. Luckily, employee engagement boosts profits as well as employee morale.

As previously mentioned, employee engagement leads to fewer workplace injuries and lower turnover rates, conserving valuable company resources. Since employee’s commitment inspires customer loyalty, businesses retain and grow clientele. Plus, employee engagement increases productivity. As the history of team building shows, early research into workplace conditions revealed that the improvement of physical conditions, social ties with colleagues, and the leader’s visible concern for workers’ wellbeing resulted in a rise in the company’s yield. Not to mention, employee engagement welcomes the kind of innovation and creativity that can lead to an employer gaining a competitive edge.

Profitability is one of the most compelling employee engagement benefits, and one of the main justifications for the upfront expenditure. Though employee engagement involves cost, the practice often brings about an attractive return on investment.

Final Thoughts

Employee engagement is one of the most important investments a company can make. The returns are manifold. Employee passion and commitment are invaluable. Not only will invested employees remain longer with the company, these individuals will strive for maximum performance and aim to inspire and elevate other members of the organization.

While talent abounds in the job market, caring and dedication requires cultivation. Engagement is the fuel that drives talent. Motivation, commitment, and satisfaction propel employees to utilize skills and realize full potential.

Next, check out this list of employee engagement books, this collection of virtual worker engagement ideas, and these campaign ideas for employee engagement at work.

We also have a guide to frameworks for employee engagement, a resource on work social committees and one on employee loyalty.

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Marketing Coordinator at teambuilding.com.
Team building content expert. Angela has a Master of Fine Arts in Creative Writing and worked as a community manager with Yelp to plan events for businesses.

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