Employee Engagement Guide: What it is and How to Measure It [+6 Tools and Metrics]

4 minutes • Aug 16, 2021Employee Engagement
Engaged Employees Happy at Work

Our friends at HR Basics create helpful YouTube videos that cover everything you need to know about a particular human resource management topics. This transcribed video helps companies understand how to use employee engagement tools and improve employee experience.

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What is Employee Engagement

In today’s HR Basics, we explore employee engagement, what it means to be engaged, and a proven method for measuring engagement. Engaged employees are those who are involved in, enthusiastic about and committed to their work and workplace. To create an environment where people flourish employers need to understand what it means to be an engaged employee and how to manage people for engagement in their workforce.

Employee engagement is about individual and organizational performance. Employees who are engaged based on key workplace elements predict important organizational performance outcomes. Gallup’s Employee Engagement Index is based on worker responses to 12 workplace elements with proven links to performance outcomes. The index provides high level insights into the workplace by displaying the percentage of engaged, not engaged, and actively disengaged employees overall.

How to Identify Engaged Employees

Engaged employees are involved and enthusiastic about their work. Those who are not engaged are unattached to their work and organization. They’re checked out. Finally, actively disengaged employees aren’t just unhappy at work, they are resentful and potentially undermine what engaged coworkers might accomplish. In 2016, 33% of US employees were engaged in their work and workplace. This is the highest number in Gallup’s 15-plus years of tracking employee engagement. But it’s not quite cause for celebration. The majority of employees, 51% are not engaged and haven’t been for some time. That leaves 16% of employees actively disengaged, looking to potentially undermine organizational results.

When your employees are engaged, they don’t just become happier, they become better performers. Organizations falter in creating a culture of engagement when they solely approach engagement as an exercise in making their employees feel happy. It is true that engaged employees feel better about their work and workplace, but simply measuring workers satisfaction or happiness levels and catering to their wants, often fails to achieve the underlying goal of employee engagement, which is improved outcomes.

Although the concept of employee engagement and job satisfaction are inter-related, they’re not synonymous. Satisfaction is about the employee being happy with their job or organization. Satisfaction is an attitude, like organizational loyalty or pride. Engagement is about the employee being actively invested in their work and the value they add to the organization. Engagement predicts satisfaction as well as many other concrete organizational results. When employees are engaged, they become emotionally attached to their work and workplace. As a result, their individual performance soars and they propel their team and organization to improve outcomes such as higher levels of productivity, safety, and quality.

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Benefits of Employee Engagement

Engaged employees make it a point to show up for work and do more work. Highly engaged organizations realize a 41% reduction in absenteeism and a 17% increase in productivity. Engaged workers are also more likely to stay with their employers. In high turnover organizations, highly engaged business units achieve 24% lower turnover. Engaged workers are more mindful of their surroundings. They are aware of safety procedures and diligent about keeping their coworkers and customers protected. Highly engaged business units realize a 70% decrease in employee safety incidents.

Finally, engaged workers care more about the products and services they deliver to customers and the overall performance of their organization. Organizations with highly engaged employees experience a 40% reduction in quality defects. When taken together, the behaviors of highly engaged business units result in 21% greater profitability.

How to Measure Employee Engagement

Levels of Employee Engagement

When using these methods to measure employee engagement, be sure to look at engagement across teams and the entire company, not just individual contributors at the bottom of the chain of command

Here are six easy ways to start measuring employee engagement right now:

1) Pulse Surveys

Pulse surveys are short surveys that happen at regular intervals throughout the year so you can track responses to the same question over time.

For example, if you’re interested in learning how a new peer-to-peer recognition program is impacting job satisfaction, you can quickly ask:

  • Do you feel respected by your colleagues for your efforts and ideas?

  • How well do you get along with your colleagues?

2) 1-On-1 Stay/Exit Interviews

Stay interviews are one-on-one meetings held between a supervisor and a valued employee so management can learn why employees might stay or leave a company. Questions during a stay interview focus on what an employee:

  • Enjoys about the company

  • Learns while at work

  • Finds important in a job

  • Wants more of while at work

3) Employee Satisfaction Surveys

Job satisfaction plays an important role in how engaged employees are, so plan to conduct an in-depth job satisfaction survey at least once a year.

The average answers to individual questions will give you an idea of specific areas that are ripe for improvement.


Recommended Reading: 8 Important Employee Satisfaction Survey Questions [+ Free Downloadable Template]

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Use this survey to gauge employee engagement today!


4) Employee Net Promoter Score (eNPS)

Employee Net Promoter Score is an anonymous tool that aims at measuring employee “loyalty.” It’s based on one simple question:

  • How likely are you to recommend people to work at this company?

Employees respond on a sliding scale of 1-10 (10 being extremely likely to recommend others work at the company).

Its simple design fails to give insight into why employees might not recommend your company to others, but it is a quick way to discover that your employees are likely unhappy and unengaged.

5) Employee Absenteeism Rate

Absenteeism describes unexcused absences from work that occur without providing a valid reason for why the employee missed their scheduled shift. It doesn’t include family or personal leave or illness. Late arrivals, early departures, or lengthy lunch breaks might be considered absenteeism.

Employees who are habitually late or absent are likely to be less engaged than others, which is why absenteeism is helpful for measuring employee engagement. To calculate absenteeism, use this formula:


(# of unexcused absences)/Total Period X 100 = % of Absenteeism


6) Voluntary Employee Turnover Rate

Some employee turnover is normal, but high turnover rates can indicate that employees don’t feel engaged. Tracking your turnover rate each month can show you how your company compares to the national average, which is 12% to 15% each year.


Recommended Reading: How to Calculate Turnover Rate + 3 Ways to Reduce Attrition [Turnover Report Template]


Click here to make your own copy of the Employee Engagement Survey!

Use this survey to gauge employee engagement today!

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