Work Environment Drives Employee Engagement

In a comment to my previous post on Work Environment as a Reward Element, which looks at the powerful role that both the physical and psychic aspects of work environment play in attracting and retaining employees, Frank Giancola shared an interesting piece of research from a Towers Perrin study a few years ago.

The TP study Working Today: Understanding What Drives Employee Engagement examines the level of engagement in the workforce, and also looks at the elements of work that most strongly drive employee engagement.

Interesting finding #1:  Employee engagement is higher in nonprofits than in any other industry segment.

Look at the following data, which highlights the % of employees surveyed who score as "highly engaged" (high scores across all engagement factors surveyed) by industry sector -

• High technology - 15%
• Insurance - 18%
• Pharmaceuticals - 16%
• Heavy manufacturing - 14%
• Hospital - 15%
• Finance/banking - 17%
• Nonprofit - 42%
• All industry composite - 17%

Interesting finding #2:  Employee engagement is driven by work environment, not pay and benefits. 

Now take a look at what the TP study found to be the top ten drivers of employee engagement.  Notice that neither pay nor benefits shows up in this list, which syncs up with what we know to be mostly true:  that the nonprofit sector is not "buying" high levels of engagement through generous compensation offerings. 

1. Senior management interest in employees
2. Challenging work
3. Decision-making authority
4. Customer orientation
5. Career advancement opportunities
6. Reputation of the company
7. Collaboration with coworkers
8. Resources to get the job done
9. Input on decision making
10. Senior management vision

Most of these engagement drivers can be classified as aspects of the work environment - reinforcing the point that this "qualitative" aspect of employment at your organization is just as important as the more "quantitative" (i.e., pay and benefits) elements, and that your total reward philosophy must take into account the entire picture.

And for nonprofits in particular:  don't overlook the opportunity you have to capitalize on your work environment to attract, retain and engage employees.