Employee Satisfaction Versus Employee Engagement: What You Need to Know

Employee engagement and employee satisfaction are terms that are thrown around a lot—sometimes even interchangeably. However, they don’t mean the same thing! 

Understanding the key differences between the two is vital for positioning yourself as a true people leader (we know you are!) while also creating and maintaining a happy, productive workplace. 

The Difference Between Employee Engagement and Employee Satisfaction 

Let’s dive into the difference between employee engagement and employee satisfaction with an exercise. Imagine these two employees: 

• Employee 1: This employee comes into work each day feeling happy, they complete their tasks and chit-chat with their coworkers. They’re pleased with their pay and benefits and don’t feel the need to start job hunting. 

• Employee 2: This employee also comes into work each day feeling happy to be there. They complete their tasks, collaborate with their coworkers, and frequently brainstorm new ideas to push the company forward. They’re upbeat about the company’s mission and don’t hesitate to voice their thoughts and concerns about ways to innovate. 

It’s clear that the first employee is satisfied with their job, and the second employee is deeply engaged with their job. 

In the HR/People space, we might define employee satisfaction and employee engagement somewhat differently. But, as a baseline, let’s go with the definitions The ADP Research Institute used in their whitepaper: 

• Employee Satisfaction: Measures how content/happy an employee is with their role and what comes with it (such as benefits, pay, environment, etc.).  

• Employee Engagement: Measures how emotionally committed an employee is to the company they work for, and as a result, how much “discretionary effort” they’re willing to put in for the company. 

Different factors influence employee satisfaction and employee engagement. According to SHRM, these are some of the factors that influence each: 

As SHRM observes, the factors that influence employee satisfaction are directly under the control of the organization. On the other hand, the factors that influence employee engagement are more so under the control or influence of the employee’s manager. 

Why Employee Satisfaction Alone Isn’t Enough 

Satisfaction doesn’t guarantee engagement, and engagement doesn't gurantee satisfaction.

Someone can be happy with their pay (Employee satisfaction) but doesn't feel innovative (Employee Engagement), but someone could also feel innovative and passionate about the mission of the company(employee enaggement), but unhappy with their pay or benefits (satisfaction).

In a 2016 study, Gallup classified two-thirds of U.S. employees as “not engaged” or “actively disengaged.” This amount was higher than the percentage of those who said they were dissatisfied with parts of their jobs! The authors of the study concluded that many “workers are satisfied but are not engaged at work.” 

So, you could have employees who are satisfied with their roles, but if they aren’t engaged, your company will miss out on benefits such as: 

• Increased productivity 

• Reduced absenteeism 

• Lower turnover 

In fact, Gallup has found that when “taken together, the behaviors of highly engaged business units results in 21% greater profitability” for companies. 

But don’t get us wrong—while achieving high levels of employee engagement at your company should be your goal, you shouldn’t ignore employee satisfaction. Without employee satisfaction, you can’t have employee engagement. 

The Connection Between Employee Satisfaction and Employee Engagement 

Employee satisfaction is one of the foundations of employee engagement. Here’s how one organization, the Oregon Primary Care Association, breaks it down:

“Managers must understand that an engaged employee is an employee who is deeply involved and invested in their work. This occurs when an employee is simultaneously satisfied, effective, and motivated.” - Oregon Primary Care Association 

So, if an employee isn’t satisfied with their job, they simply can’t be engaged with their job. Think about your own previous work experiences. Wasn’t it much harder to be engaged at those jobs where you felt like you weren’t being paid enough or felt like you were overworked? Because you felt like your baseline needs weren’t being met, you likely didn’t have the drive to go the extra mile for your employer. 

The same logic applies to your company’s employees. If they are unhappy with their pay, benefits, hours, or job security, they might stick to doing just the minimum of what they need to do so they can get through each day. Brainstorming, collaborating, asking thought-provoking questions—those things will be on the backburner. 

How to Start Improving Employee Satisfaction and Employee Engagement 

If you want to build more momentum around employee engagement, you should start with building employee satisfaction. 

Find Out How Satisfied Employees Currently Feel with Their Jobs 

The phrase “knowledge is power” applies here. The best way to begin is to measure where your employees are currently at with a survey. 

Key job satisfaction areas to measure include income, workload, and work-life balance. You can use a “Strongly Disagree, Disagree, Neutral, Agree, Strongly Agree” scoring system and include a comment box where employees can add additional thoughts. 

Take Actionable Steps to Boost Employee Satisfaction 

Once employees are done filling out the survey, you can analyze the results and take action as needed. For example, say over half of your employees indicated that they “disagree” that their workloads are manageable. In that case, you can gather all the managers and strategize on how to help employees gain a better work-life balance. Maybe the solution is to hire additional employees. Or, perhaps the management team evaluates current projects and deems one or two of them unnecessary. 

Some additional steps you can take to improve employee satisfaction at your organization include: 

• Enabling employees to have more control. That control can be over their schedules, work settings, and work habits. Maybe you have an employee who prefers to work on his porch at the crack of dawn. Give him the wiggle room to do so! 

• Freeing up time throughout the organization. When an hour goes by in a meeting, and you still haven’t hit the agenda items, employees notice—and get annoyed. Show employees that you respect their time by making meetings shorter and keeping them on track. 

• Encouraging career growth for all employees. When employees feel like their employer supports them in learning new skills and expanding their horizons, they’ll be more satisfied day-to-day because they’ll have a sense of moving forward in their careers. One way to kick off the process is by having employees research your company’s employee directory to get a sense of where they’d like to be within the organization in the future.  

Once you’ve got things moving in the employee satisfaction department, you can begin building employee engagement. 

Get the 411 on How Engaged Employees Currently Are 

We’ll be using one of our favorite tools, the survey, once again—this time, to see how engaged employees currently are. 

Some of the main engagement areas to measure are how well employees understand the company’s mission and values, how supportive employees feel their managers are, and how well employees feel they collaborate with their colleagues. For this survey, you can use a scale of 1-5 for the responses, with a score of 1 indicating “none/never/not at all” and a score of 5 indicating “a lot/all the time/extremely.” Be sure to include a comment box where employees can expand their thoughts in this survey as well. 

Start Nurturing Higher Employee Engagement 

After you get the survey results, you can analyze them and take the necessary steps forward. For example, maybe most employees in a certain department scored the question, “How supportive is your manager?” with a 2. To change that situation around, you can meet with that manager to have a productive conversation where you brainstorm strategies to help those direct reports feel more supported. Maybe the manager realizes that one area he needs to improve in is giving balanced feedback. He can then make it a point to do so in each one-on-one. 

You can take more steps to foster employee engagement at your organization, including:

• Creating a thorough performance review process that includes peer-to-peer recognition. This will help employees feel more at ease because they’ll know they’ll be getting feedback from more people than their manager. And once they see thoughtful feedback from their peers, employees will feel an even stronger bond with them, as well as a stronger connection to the company. 

• Encouraging workplace friendships. The more “plugged into” the company culture an employee is, the more likely they are to collaborate and drive the company’s goals forward. 

• Mixing up day-to-day life with different activities. From inviting interesting guest speakers to having the team volunteer together, there are many ways to cut through the mundanity of the weeks. These types of activities will give employees another thing they can look forward to—who wouldn’t want to end their work day alongside their colleagues by listening to that local musician share how they got to where they are today? 

Remember: These Efforts Should Be Ongoing 

Creating a work environment where everyone feels included and like their work matters takes a lot of effort, but it’s not impossible! All you need to do is focus on momentum. Keep iterating, improving, and taking feedback from your employees to figure out exactly what is and isn’t working. Employee satisfaction and employee engagement should be ongoing efforts. What keeps employees satisfied and engaged one day might not be enough in the future. For example, maybe employees were satisfied with having two weeks of PTO until your biggest competitor started offering four weeks of PTO. Or, maybe employees in a particular department no longer feel supported by their manager for whatever reason. 

It’s up to you and other members of the leadership team to stay on top of employee satisfaction and employee engagement. Send out regular surveys, and always strive to make improvements early. That way, you can ensure that each employee will show up to work every day ready to bring their all. 

Want even more tips on fostering employee satisfaction and employee engagement? Listen to our podcast!