Actively disengaged workers cost U.S. hundreds of billions a year

23 March 2001 - A Gallup study indicates that "actively disengaged" employees - workers who are fundamentally disconnected from their jobs - are costing the U.S. economy between $292 billion and $355 billion a year. This finding appears in the inaugural issue of Gallup's new quarterly, the Gallup Management Journal (GMJ).

These estimates are based on a recent Gallup "Q12" employee engagement survey of the U.S. workforce, which calculates that 24.7 million workers (19%) are actively disengaged. The survey found that actively disengaged workers are absent from work 3.5 more days a year than other workers - or 86.5 million days in all.

Gallup research consistently shows a tendency for actively disengaged workers to be (in comparison with colleagues):

- significantly less productive
- report being less loyal to their companies
- less satisfied with their personal lives
- more stressed and insecure about their work

Gallup has developed a proprietary formula to measure levels of employee engagement based on worldwide survey results and performance data in its database. In fact, over the past three years, Gallup's employee engagement consulting practice has surveyed more than 1.5 million employees at more than 87,000 divisions or work units.

Gallup intends to administer the national Q12 survey every quarter to a representative sample of American working adults. These will be published in GMJ. The Q12 survey takes its name from 12 core questions (see below) that Gallup asks the employees at its clients' work units. The results allow Gallup clients to see and understand links between levels of employee engagement and productivity, growth and profitability.

1. Do I know what is expected of me at work?
2. Do I have the materials and equipment I need to do my work right?
3. At work, do I have the opportunity to do what I do best every day?
4. In the last seven days, have I received recognition or praise for doing good work?
5. Does my supervisor, or someone at work, seem to care about me as a person?
6. Is there someone at work who encourages my development?
7. At work, do my opinions seem to count?
8. Does the mission or purpose of my company make me feel my job is important?
9. Are my co-workers committed to doing quality work?
10. Do I have a best friend at work?
11. In the last six months, has someone at work talked to me about my progress?
12. This last year, have I had opportunities at work to learn and grow?

Cost calculations

The $292 billion estimate of the annual cost of actively disengaged employees was derived through a three-step process:

1. The proprietary formula was applied to the Q12 survey results in order to calculate the number of actively disengaged employees in the US.

2. Standard utility analysis methods (statistical guides) were applied to the $30,000 per year U.S. average salary, yielding $2,246.

3. This was multiplied by 130 million U.S. workers who are 18 years old or older, resulting in the $292 billion estimate.

Gallup's $355 billion estimate had its basis in a different economic measure - the USA's $10 trillion Gross Domestic Product in the year 2000.

* The GDP figure was divided by the total number of U.S. workers, yielding $73,870 worth of goods or services per worker last year.

* Also using standard utility analysis methods, Gallup statisticians found that a 3.7% increase in output for each employee would be attributable to eliminating active disengagement from the workforce.

* The 3.7% increase, applied against the $73,870 average output figure amounts to $2,733 per person in the workforce, or $355 billion overall.

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See also:
Employer branding
Negativity
Passionate employees