Dynamic Signal Study Finds U.S. Workforce Stressed And Ready To Quit, Compounding Concerns From Tight Labor Market And Possible Economic Downturn
Average Fortune 500 Company Exposed to $1.2 Billion in Economic Loss Due to Turnover Fueled by Poor Communication
SAN BRUNO, CA – March 20, 2019 – At a time of economic uncertainty and record-low unemployment, a shocking number of U.S. employees are stressed, unhappy and ready to quit. According to findings from Dynamic Signal’s Annual State of Employee Communication and Engagement Study, 80 percent of the U.S. workforce reports feeling stressed because of ineffective company communication – a 30 percent jump from just one year ago.
The 2019 study which surveyed 1,001 U.S. employees, also found that 63 percent have wanted to quit because ineffective communication interfered with their ability to do their job – almost double from the 33 percent in 2018.
Companies aren’t prioritizing Employee Communication and Engagement highly enough.
- 70 percent of employees feel overwhelmed because of broken communication methods and fragmented information
- 78 percent of employees surveyed said improving Employee Communication and Engagement should be a higher priority for their current company
- More than half of employees (60 percent) wouldn’t confidently advise keeping their CEO because of the poor communication they’ve experienced
- 17 percent of employees would recommend firing their CEO based on how the company communicates to its employees
- A majority of employees (53 percent) don’t feel like their company communicates with them in a way that makes them want to be an advocate for the organization. Though a whopping 83 percent say they’d be an advocate if employee engagement was better
Dynamic Signal’s survey results highlight the urgent business need for improved Employee Communication and Engagement.
“It’s obvious that a tight labor market in recent years has highlighted the need to improve the employee experience, but poor internal communication is leaving workers stressed and ready to look for other jobs,” said Russ Fradin, CEO of Dynamic Signal. “Companies need to get ahead of the problem of broken employee communication if they’re going to have the internal alignment to meet business goals, the culture to retain talent, and the agility to respond to a possible economic downturn.”
On average, the cost to replace an employee is 33 percent of annual salary according to the Work Institute. At a Fortune 500 company with an average employee salary of $73,000, each employee could cost around $24,000 to replace. With the average Fortune 500 company employing more than 52,000 workers, this can leave those large companies with an average risk of more than $1.2 billion in turnover-related costs.
Employee Engagement Critical for Reducing Risk
These risks can be prevented by improving employee engagement. Organizations with higher employee engagement see 24 percent greater worker retention, 21 percent higher profitability, and 17 percent more productivity, according to Gallup’s State of the American Workplace report, released in 2017.
U.S. employees clearly value more effective Employee Communication and Engagement at their companies, making them hungry for improvement, even more than compensation. In fact:
- 90 percent of employees say good company communication is key to a positive working environment
- Even with lower-than-ideal pay, 69 percent of employees would be less likely to quit if their company was more effective at communicating
- 85 percent of employees consider effective communication an “employee benefit”
- 67 percent of employees would go “above and beyond” their duties if they felt more valued and engaged
- A majority of employees (52 percent) said they had witnessed poor financial outcomes (lost sales, damaged company reputation) due to poor communication
Methodology: This study was commissioned by Dynamic Signal and conducted by the independent market and advertising research firm Survata. Survata interviewed 1,001 online respondents between January 31, 2019, and February 12, 2019. For further information, visit www.survata.com/methodology.