How Much Are Disengaged Employees Costing Companies? Billions!

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It’s no secret that engaged employees have a tremendous impact on the success of a company. Numerous studies conducted over the past two decades have conclusively proven that engaged employees lead to higher productivity, lower turnover rates and larger profits. But, have you ever wondered how much disengaged employees are costing their companies? 

The answer may suprise you. From lowering employee morale to massively reducing productivity, a disengaged employee can quickly destroy an entire company.

What's the True Cost of Disengaged Employees

The cost of disengaged employees is staggering. According to Gallup, one of the most revered sources for workplace statistics, 70% of American employees are slowing economic growth by not working to their full potential. Of this 70%, 52% are not engaged and nearly 20% are actively disengaged. 

What does this mean in terms of dollars? According to Gallup, the 18% of employees who are actively disengaged cost around $500 billion in lost productivity each year.  And that’s just in the United States.

How Are Disengaged Employees Destroying Companies?

To start with, disengaged employees are disconnected from their co-workers and companies. Often times, they will even be working against their company’s best interests. While there are a few obvious ways that disengaged employees are negatively impacting companies – missing workdays, driving away customers, being less productive, negatively influencing co-workers – some of their destructive actions aren’t so obvious.

Forbes contributor Falon Fatemi recently addressed a number of these issues in her article, “The True Cost of a Bad Hire – It’s More Than You Think.” As Fatemi tells readers, “disengagement is contagious.” When an employee is disengaged, they affect everyone around them. Poor performers lower the bar for everyone. Good employees get burnt out trying to make up for the slack of the disengaged parties. Perhaps worst of all, when a disengaged employee disrespects the priorities of other, hard-working teammates, you risk losing your best workers.

How to Prevent Disengagement from Occuring in the first place.

The best way to combat employee disengagement is to stop it from occurring in the first place. Although this is easier said than done, C.A. Short company has identified The 7 New Rules of Employee Engagement. Here are a few examples that can help every industry engaged their employees: 

  • Culture: Create a culture of recognition that resonates through all aspects of your organization. Incorporate formal, informal & day-to-day recognition into the strategic recognition platform.
  • Resources: Empower employees to develop new skills to advance their careers. Reward those employees who use those opportunities to learn and improve.
  • Communication: Consistently communicate and live your organization’s values & vision. Recognize those employees who impact the quality of the organization’s work, products, and services.

If you would like to learn more about how to engage your workforce, download our FREE The 7 New Rules for Employee Engagement Wall Chart below.

 

7 New Rules of Employee Engagement Wallchart

C.A. Short Company partners with companies to manage, drive and facilitate increased employee engagement to increase financial performance, productivity, quality, and core performance outcomes. Our process and research-based platform enables executives and managers to engage their teams to increase the bottom line, motivate staff, and incentivize positive behavior. To request a Complimentary Consultation, please click here. 

 

Topics: Employee Engagement, Disengagement,

Jeff Ross, CPA, CRP

About the Author
Jeff Ross, CPA, CRP

President & CFO
Mr. Ross is a certified public accountant. He joined the C. A. Short Company as its controller in June 1993 and was promoted to Chief Financial Officer in November 1996. January 2010 Mr. Ross was promoted to President and Chief Financial Officer. Mr. Ross is a Certified Recognition Professional as designated by Recognition Professionals International. Mr. Ross was employed as an accountant by Hausser + Taylor, a large public accounting and consulting firm from September 1989, until June 1993. Mr. Ross serves on the Board of Directors of 2XSalt Ministries, Charlotte, NC and is a member of North Carolina Association of Certified Public Accountants, The Ohio Society of Certified Public Accountants and American Institute of Certified Public Accountants. Mr. Ross graduated from The Ohio State University with Bachelor of Science and Bachelor of Arts Degrees in 1989.

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