North America Sees Lowest Levels of Employee Engagement Since 2008, According to Aon Hewitt Analysis

Career Opportunities, Employee Performance and Organization Reputation are Top Engagement Drivers in 2012

TORONTO, May 21, 2013 /CNW/ - While the economy in North America has shown steady improvement over the past year, a new analysis by Aon Hewitt, the global talent, retirement and health solutions business of Aon plc (NYSE: AON), reveals that employers and the workforce are not yet following suit. Employee engagement levels in North America have declined to the lowest levels since 2008 and the way employees perceived their general work experience in 2012 remains unchanged from the prior year.

Aon Hewitt's Global Engagement Report, which analyzed employee engagement trends of more than 2,500 global organizations representing 3.8 million employees, found that employee engagement in North America decreased by 1 percentage point to 63 percent in 2012. Engagement among U.S. workers, in particular, dropped 3 percentage points in 2012.

Aon Hewitt's analysis also revealed some dynamic shifts in how North American employees felt overall about their work experience. While certain areas had increases in employee perception scores, others dropped. Areas with the highest increases in employee perception scores in North America include:

• Innovation (+13 percentage points)
• Effective communication (+7 percentage points)
• Managing performance (+7 percentage points)
• Pay (+3 percentage points)

Areas where work experience scores worsened in 2012 include:

• Diversity (-9 percentage points)
• Customer experiences (-7 percentage points)
• Business unit/division leadership (-4 percentage points)
  
  

"While some aspects of the work experience have improved in North America, the overall drop in engagement could indicate that companies have not been sufficiently investing in talent," said Dr. Ken Oehler, Aon Hewitt's Global Engagement practice leader. "As North American organizations grapple with competing pressures—demand for profitable growth, financial market volatility, political uncertainty and global shifts in workforce demographics—declining engagement levels may have negative, longer-term consequences on business performance. Our survey findings signal a call to action for leaders to make employee engagement a business imperative."

Leadership's Call to Action
According to Aon Hewitt, leaders at North American organizations are likely to get the highest return on investment in employee engagement if they take ownership of employee engagement and focus on improving the drivers that matter most to employees. Aon Hewitt's survey shows the areas that ranked as the top engagement drivers for employees in North America were:

• Career Opportunities - For the fifth consecutive year—globally as well as across North America—career opportunities remained the top driver to positively impact overall engagement levels. Yet a little over half of employees in North America (53 percent) think they have good advancement opportunities at their organization.
  
  "Employers should focus on improving advancement opportunities for their high potentials and the highly engaged," said Lorraine Stomski, head of Aon Hewitt's Leadership practice. "Placing these individuals in challenging stretch assignments will keep them motivated and will enable organizations to put their best talent in the most impactful positions. To excel in this area, managers should have more frequent career coaching conversations with their employees."

• Enabling Performance - While enabling performance was the second highest engagement driver in North American, just little over half (58 percent) of employees say they have the tools and resources needed to perform effectively in their organization. Simply removing barriers to performance—such as clarifying goals, reducing process complexity and ensuring technology supports productivity—will help decrease anxiety, stress and frustration and fully unlock an individual's potential and performance.
  
  
• Reputation - According to Aon Hewitt, just six out of 10 employees in North America know what their organization wants to be famous for in the market, yet this is the third most important engagement driver. According Oehler, without a clear and concise organizational response to this question, it is difficult to attract, retain and engage the talent needed for organizational success.
  
  "The reputation of an organization is a function of business performance, social responsibility and general impressions. It is also very much about what people in the job market think about an organization as a place to work," he said.

• Communication - Aon Hewitt's analysis shows only half of employees around the world think their company is effective at communicating with employees. Engaging communication that tells employees about the organization, where they fit in and the path forward goes a long way in making employees feel like they are adding value and contributing to the bottom line.
  
  
• Recognition - According to Aon Hewitt's analysis, employees want recognition for their performance and recognition for how difficult things have been. However, only 50 percent of employees in North America think their employer currently recognizes this type of extra effort. "As companies continue to manage expenses and focus on growth, recognition can be very effective at motivating employees and often comes at little to no cost to the organization," said Oehler.

Engagement Levels by Region
Aon Hewitt's analysis shows overall employee engagement levels worldwide improved from 58 percent in 2011 to 60 percent in 2012. North America was the only region to see a decrease in employee engagement levels in 2012. Despite continued economic and business pressures, the largest engagement increase was in Europe, improving 5 percentage points. Latin America's engagement scores improved 3 percentage points, and Asia Pacific's remained consistent with those from 2011.

2012 Engagement Levels By Region

Region	2011	2012
Globally	58%	60%
North America	64%	63%
Asia Pacific	58%	58%
Europe	52%	57%
Latin America	71%	74%

Engagement by Segments
Aon Hewitt's analysis also showed differences in engagement levels by job level and generation. Not surprisingly, executives and senior managers in North America were the most engaged (75 percent) followed by middle managers, team leaders and supervisors (68 percent). Team members, or front-line employees, had the lowest level of engagement at 65 percent.

When analyzing the data by generation, Aon Hewitt's analysis showed Baby Boomers had the highest level of engagement, with 63 percent engaged, followed by Generation X (58 percent) and Millennials (57 percent).

"The multicultural, multigenerational and cross-geographical world represents new challenges for leaders who are trying to drive high levels of employee engagement," said Oehler. "Understanding the differences that exist by job function, generation and job level allows organizations to identify critical gaps in where they need to invest their resources and also helps them better understand how to tailor engagement strategies to attract a specific group of people."

Download the 2013 Global Engagement Report: www.aon.com/human-capital-consulting/thought-leadership/talent_mgmt/2013_Trends_in_Global_Employee_Engagement.jsp

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About Aon Hewitt
Aon Hewitt empowers organizations and individuals to secure a better future through innovative talent, retirement and health solutions. We advise, design and execute a wide range of solutions that enable clients to cultivate talent to drive organizational and personal performance and growth, navigate retirement risk while providing new levels of financial security, and redefine health solutions for greater choice, affordability and wellness. Aon Hewitt is the global leader in human resource solutions, with over 30,000 professionals in 90 countries serving more than 20,000 clients worldwide. For more information on Aon Hewitt, please visit www.aonhewitt.com.

About Aon
Aon plc (NYSE:AON) is the leading global provider of risk management, insurance and reinsurance brokerage, and human resources solutions and outsourcing services. Through its more than 65,000 colleagues worldwide, Aon unites to empower results for clients in over 120 countries via innovative and effective risk and people solutions and through industry-leading global resources and technical expertise. Aon has been named repeatedly as the world's best broker, best insurance intermediary, reinsurance intermediary, captives manager and best employee benefits consulting firm by multiple industry sources. Visit www.aon.com for more information on Aon and www.aon.com/manchesterunited to learn about Aon's global partnership and shirt sponsorship with Manchester United.

 

SOURCE: AON Hewitt

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