Why Employees Aren’t Loyal or Engaged—and What You Can Do About It

Workers’ attitudes towards their careers have changed over the years. But there are strategies to improve engagement and reduce turnover in the workforce.

The days of your employees simply being content with a good-paying job and sticking with most companies for the long-haul are basically gone.

Today, members of the workforce lack the loyalty and engagement that past generations had because of new priorities and the fact that many employees have realized that they’re expendable. In the United States alone, disengaged employees cost companies as much as $550 billion annually. And the total turnover rate rose “from 15.1% in 2013 to 18.5% in 2017”—a nearly 30% increase in just four years.

Many workers know that they’re one economic downturn away from ending up on the unemployment line, so they see no reason to link their sense of self to their work or be loyal to a company. There are some things that you can do to motivate and inspire loyalty in your employees, however. It starts with giving them a little bit more of something—and that’s not always money.

The reasons employees aren’t loyal or engaged

In the past, workers would give themselves entirely to their jobs. Their careers became part of their identity and were largely responsible for how they saw themselves, and how others viewed them. Contemporary society is different because we tend to view jobs as a necessity for financial means, rather than something one is necessarily proud of in day-to-day life.

While older workers may have a history of being more loyal to a company and cherishing stability, even they are becoming less engaged after experiencing mass layoffs and seeing that no company is truly loyal to them. The workforce is also moving towards a healthier work/life balance, a philosophy that is often attributed to being driven by Millennials. And all employees want to spend enough time with their kids, go on vacation, and enjoy their free time, rather than focusing on work all of the time.

The result is many workers who are happy to get through the day and collect their paycheck but aren’t willing to push a little bit more to make the company better. This idea also spurs employees to demand more from their employers—not necessarily more money; rather, more freedom. Nevertheless, each individual may have a different balance of flexibility, compensation, and a sense of purpose or comfort that defines a job they are invested in and don’t want to leave.

Here are some options for finding the right mix:

Offer financial incentives that are tied to the success

To get your employees engaged at work while keeping them loyal, you’ll have to give them a good reason. And one method that resonates with certain workers is providing a stake in the business.

By offering part of the company to your valued employees, you create loyalty and incentives. Individuals who own a piece of the pie feel like they’re actually part of the organization, rather than just another cog in the corporate wheel. They often become invested in its success.

In some cases, employers offer actual shares (perhaps as part of an Employee Stock Ownership Plan (ESOP)) that can be purchased or are received as bonus incentives. Phantom equity is another tactic. It’s dubbed “phantom” because the employee isn’t a real owner, but still has a financial stake in the company. The idea is that if the employee’s work increases the value of an aspect of the business—with value being tied to a well-defined metric, such as gross sales—he or she receives a monetary reward.

This phantom equity isn’t given out annually like a bonus, but rather on a schedule. As a result, it provides you with flexibility along with a more engaged employee who works harder to hit regular, tangible targets.

Offer employees flexibility

How much flexibility are you providing your employees?

Do you allow staff to work from home? Is the number of vacation days flexible? Do you give extra time off for business milestones or life events?

The more you allow your employees to maintain a positive work/life balance, the more engaged they’ll be when on the job: 82% of employees report that their loyalty would increase if they were provided with increased flexibility. In addition, they’re less likely to spend time looking for new opportunities if you refrain from working them into the ground. Done right, flexibility programs create no loss in productivity and a tangible ROI in the form of increased engagement and lower turnover.

The average cost of replacing one worker is about 33% of their salary (which averages to $15,000 across the workforce), according to one estimate, with that number becoming significantly larger for higher-level and more-skilled employees. But a well-implemented flexible work policy can retain many valuable individuals and cost you nothing.

Provide continuing education

Are you helping your employees to better themselves professionally? When you invest in your workers, they feel valued—which can lead to reduced turnover and increased engagement.

Paying for your employees to add new certifications or upgrade their degrees can help build loyalty. This also benefits the company with a better-trained staff. Furthering the education of your employees is a win-win, so it’s well worth looking into for your organization.

Be careful, however, of large investments like graduate degrees that are not tied to staying with the company for a certain period of time. Often, much simpler training incentives like workplace certifications, budgeted weekly time for continuing education, and attending relevant seminars and conferences are sufficient to motivate employees.

Change the workplace culture

The culture within the workplace is considered a “soft” factor because it’s less tangible than paid time off or better pay. But it’s no less essential. A good culture provides individuals a sense of belonging within a team, personal satisfaction, and even purpose. In contrast, toxic cultures inevitably spur poor performance and massive turnover.

Employees might not always consider themselves loyal to the company when working in a pleasant environment and with a tight team—but they’ll likely have a commitment to other members of the unit. Don’t underestimate this as a motivation.

A positive culture in the workplace is a huge factor in stable workplaces: 23% of workers would leave their jobs without a pay increase just to join an office with a better reputation. A positive environment that develops strong relationships between colleagues and between employees and management is critical to an engaged workforce.

Tailoring benefits and incentives to  the contemporary workplace

The workplace has changed dramatically in recent years, and employers who don’t adapt are sure to be left behind. By learning why workers tend to be less loyal and engaged and taking proactive steps to fight this trend, you can become a magnet for high-end talent that sticks around—rather than chasing it away.

Karp HR Solutions can help you develop and implement a strategy for attracting and retaining quality workers who are loyal and engaged. Contact us today to see how we can help your organization reach its business goals.