Engagement rising in ANZ during "pivotal moment" for workplaces
Source: HR Daily (Subscription service) (23.04.2025)
Australia has bucked the global trend of declining engagement levels, registering a small uptick in the past year, new research shows.
Gallup's 2025 Global State of the Workplace report says now is "a pivotal moment in the global workplace" where, amid seismic change, "engagement is faltering at the exact time artificial intelligence is transforming every industry in its path".
Globally in 2024, the percentage of engaged employees fell from 23% to 21%. This is concerning, according to the report, because the only other time engagement has fallen in the past 12 years was in 2020.
"Last year's two-point drop in engagement was equal to the decline during the year of COVID-19 lockdowns and shelter-in-place orders."
In ANZ, however, engagement was 23% – one percentage point higher than the previous year.
"The good news is that the pattern is trending up for Australia and New Zealand," says Claire de Carteret, Gallup's APAC managing director.
"While it was only one percentage point from last year's data to this year, the previous year we saw an increase, so we've seen a pretty steady increase since 2012," she tells HR Daily.
"Really, the only time where it stagnated for Australia and New Zealand was the obvious – 2020."
Given that engagement is a leading indicator of productivity, she says this is "good news" for employers.
Asked why ANZ is bucking the global trend, de Carteret says, "it's hard to pinpoint it to any one thing, but there's definitely been effort", including regulatory changes regarding psychosocial hazards to make workplaces more safe and inclusive.
Also of note is that ANZ employees report one of the highest scores when it comes to "life evaluation". Although the number has "decreased quite meaningfully" (down four percentage points), de Carteret says 56% still consider themselves "thriving", compared to just 33% globally.
Stress, however, is worse in ANZ than the global average, with almost half (49%) of ANZ respondents saying they'd experienced feelings of stress "a lot of the day yesterday", compared to 40% globally.
Help managers, or risk cascading disengagement
"Daily stress has reached its highest level," de Carteret says. The population experiencing the most stress is managers; this group's engagement is also decreasing (from 30% in 2023 to 27% in 2024), while individual contributors' engagement remained flat at 18%.
"Suddenly, we're asking managers to have conversations around psychosocial [safety], whilst also driving performance; they're having conversations about wellbeing whilst also being mindful of mental ill-health and the stress that people are under when they walk into work each day.
"They're managing remote work, they're managing AI transformations – there's a lot on managers' plates, and additionally most managers feel ill-equipped to be a manager because they're not getting the right training."
If managers start burning out, they'll stop acting as a buffer for employees, de Carteret warns.
"When the manager is thriving, they've got more resilience, they're engaged, and they're able to then further support and boost the engagement of their team. But when they're depleted, when they're lacking resilience and engagement, then downstream, what we would typically see is that cascades."
The challenge is to refresh and reorganise the role of the manager so it's not out of synch with the modern workforce, de Carteret says.
Rather than perpetuate "initiative overload", the focus should be on meeting basic needs, in particular, supporting managers, and ensuring any training and coaching intended to support them is aligned to what they need most.
De Carteret adds that the number-one thing she would do if she were an HR manager right now is listen more.
"Double down on listening to how people are feeling, what they want, what they need."
An unmet need
It's also possible that employees think one of their greatest needs is being met when it isn't, Gallup's report suggests.
Widespread disconnection doesn't "bode well" for navigating a future shaped by AI, it says. While AI could spark growth – "equipping managers and teams with the resources to excel, offering abundant opportunities for development, and reconnecting everyone to a shared mission", it could also "diminish engagement by severing the vital human bonds – friendships at work, a sense of being heard and genuine care from colleagues – that keep teams thriving".
"Without knowing it, people are feeling less connected," de Carteret says. In the past five years, many have stopped experiencing "the real connection that you get from being in a team, working on hard things together, face to face". But because they're still connecting online, and because they've adapted to the new norm, many are no longer aware of what they're missing.
Bringing people back together with a mandate is counterproductive, "but when it comes to wellbeing and thriving and workplaces, other people matter", de Carteret says.
Therefore, employers need to find ways to draw them back by choice.
"Friendships matter," says de Carteret. "Camaraderie, trust, social connection, and working on tough problems together," all boost wellbeing and engagement, while decreasing negative emotions such as loneliness, sadness, worry, and stress.
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