- Gallup’s latest report indicates global stagnation in employee engagement and a decline in wellbeing, with 62% of workers identified as not engaged.
- Key trends from the report include the reduction of active disengagement levels with greater job flexibility, enhancements in life satisfaction rates through improved labor protections, the correlation of worker engagement with future optimism, and the improvement of mental wellbeing through a combination of supportive labor policies and employee engagement.
- The ideal strategy arising from Gallup’s research on the impact of policy and economics on employee wellbeing is to combine supportive and inclusive labor laws with an engaging work environment.
Gallup Inc. is a leading analytics and advisory company focused on workplace dynamics and wellbeing. Gallup is renowned for its research, public opinion polls, and management consultancy services based on data-driven insights. Gallup’s World Poll, the most ongoing study of the global employee experience, reaches over 99% of the world’s adult population. Gallup’s State of the Global Workforce report provides internationally comparable survey metrics, highlighting key organizational resilience and performance indicators.
Gallup’s latest report reveals stagnation in employee engagement and a decline in wellbeing in 2023, with 62% of employees classified as “not engaged” or “actively disengaged” (15%). It is worth noting that employee engagement is an effective indicator of business performance during economically turbulent times and that this level of disengagement represents a loss in global productivity of $8.9 trillion (9% of global economic output, or GDP).
Key Trends: The Impact of Economics and Policy on Workers’ Wellbeing
The State of the Global Workforce report offers a global perspective, illustrating how national economic policies (and labor laws) impact worker wellbeing across different regions.
1.Active disengagement levels reduce with increased job flexibility:
The report highlights that 15% of the global workforce is actively disengaged and frequently endures diminished wellbeing (54% reported significant stress). Thriving job markets with more opportunities and flexibility can reduce disengagement rates — indicating that when local economies are healthier, employees can move into more satisfying jobs. However, economic stability alone may not necessarily foster higher levels of engagement.
2.Labor protections improve life satisfaction rates:
The Labour Rights Index evaluates 46 labor laws across 135 countries, encompassing regulations on wages, discrimination, paid leave, and safety. Sub-indexes such as Maternity at Work, Fair Wages, Social Security, Employment Security, Fair Treatment, and Safety demonstrate strong correlations with life satisfaction (after adjusting for income and demographics). Economically advanced economies generally have more labor laws, which correlate positively with life satisfaction, especially in current life evaluations.
3.Employee engagement correlates with future optimism:
Engaged employees, regardless of their country’s labor rights protections, exhibit higher optimism about their future — indicating that meaningful job engagement significantly fosters hope for the future among employees.
4.Mental wellbeing improves with a combination of supportive labor policies and employee engagement:
There is a complex relationship between labor rights and employee engagement. Western European countries with comprehensive labor laws, for instance, tend to have lower engagement levels, while the United States, which has weaker labor protections, has higher engagement rates. Norway, Denmark, and Sweden all rank high on the Labour Rights Index yet maintain only average employee engagement levels. Countries with similar labor protections exhibit varied engagement levels — indicating that workplace dynamics and individual experiences play significant roles. The impact of labor laws can also vary widely within countries.
Combining inclusive labor protections with high employee engagement leads to the lowest levels of negative daily emotions among workers. For instance, specific labor laws and policies, such as fair wages, safe working conditions, mental health support, and adequate leave, are associated with reduced loneliness, lower stress levels, and improved worker wellbeing. Additionally, laws that limit working hours and ensure sufficient annual leave correlate with decreased stress levels.
The Complex Interplay between Economics, Policy and Employee Wellbeing
Proactive national policies such as fiscal stimulus and unemployment benefits can foster labor markets that support workers’ livelihoods during a recession. At the organizational level, highly skilled, empathetic leaders who prioritize inclusive policy making can also mitigate the impact on workers during economic downturns.
Gallup’s research highlights the complex relationship between local workplace dynamics, macroeconomic policies, and governmental influences on employee wellbeing. While all labor protections and policies impact employee wellbeing, specific measures are better indicators of worker engagement and mental health. For example, social security and proactive labor policies correlate with higher levels of employee satisfaction and lower rates of burnout and disengagement.
In countries where laws limit work hours, employees show higher engagement and report lower daily stress levels, especially under regulations capping weekly hours at 56 and guaranteeing a minimum of three weeks of paid annual leave. Furthermore, economic pressures often compel employers to mandate a return to the office, prompting employees to prioritize their work-life balance. This underscores the importance of empathetic leadership and a supportive organizational culture in addressing workplace dissatisfaction and enhancing employee engagement. The optimal approach to promoting employee wellbeing involves integrating supportive labor laws with an engaging work environment.
State of the Global Workplace: 2024 Report