In a recent study compiled by the Center for Creative Leadership (CCL), worldwide engagement levels rose as the economy took a counter-clockwise spiral into the crapper (clockwise for you folks in Australia and NZ). The study (excerpted here) suggests that as the economy and international markets decline, employees actually get happier at work. In fact during the two year study period, engagement levels peaked at the exact same time as the Dow Jones Industrial Average (DJIA) hit its lowest point. But it isn’t all good news. As the economy is starting to recover, signs are showing that employee engagement is declining. So why this odd paradox?
The Center for Creative Leadership poses several suggestions to why this seems to happen. Predominantly, employees during a down economy have less options for employment and as a result tend to focus on what they have instead of contemplating how the grass in greener elsewhere. Which makes sense, if the grass over there looks crappy, I start to focus on the green patches I have left in my yard.
Another concept CCL introduces as a potential cause for the irony, is what is known as the “paradox of choice.” The principle behind this paradox is when confronted with numerous choices, a person is less satisfied with their selection since they feel they had to “give up” something another choice would have provided. I cite my current happiness with my mobile phone. If that phone was the only choice, I would probably be happier with it since I would have nothing to compare it to.
But as the economy starts to wake up from its groggy slumber and more employment options surface, the data suggests employee engagement will decline. In fact it is already trending in that direction. So what to do besides try to cause another economic decline to keep your employees happy? Effective leadership has been cited as the greatest correllary to higher employee engagement. While you may not save everyone, rest assured effective leaders (at all levels) will loose fewer employees and have more engaged teams regardless of economy.
Employees also cite opportunities to learn, develop, and challenge themselves as positive indicators of engagement. Money has been proven my several studies to be a maintenance piece. Low compensation might motivate people to leave, but having it higher than it needs to be doesn’t necessarily increase engagement or someone’s likelihood to stay. So the moral is pay them enough (and this is by their judgment) and provide them opportunities for development, challenge, and autonomy (another indicator).
These indicators all point to developing your staff. Develop your managers to be better managers, and give your employees the opportunities to develop and learn as well. Coaching, training, role sharing, self-directed challenges, and other leadership development efforts can all pay double dividends. After all training a manager to be more effective is usually hugely cheaper than replacing them with someone who may not be any better.
Invest in your people, pay them enough, help them succeed, and let them chose how to get their jobs done. It really is that simple.