Employers are keenly aware that employee engagement and satisfaction have fast become two of those seemingly elusive culture goals. Surveys from a variety of sources over the past few years peg engagement levels in the low-to-mid thirties.
Gallup, for example, which follows employee engagement closely, reports that in 2016 employee engagement remained stagnant from the previous years, barely budging from 31.4 in 2014 and 32 percent in 2015. Of course, there are many factors that go into high levels of employee satisfaction.
Now, a study out this week reveals that the pay process at an organization, in terms of fairness and transparency, is 5.4 times more impactful on how satisfied employees are than how they are paid relative to their market value.
PayScale, Inc., a cloud-based compensation data and software provider, designed the survey to identify the drivers of employee engagement. It queried more than 500,000 employees for its employee engagement research on various aspects of their job that could potentially contribute to both employee satisfaction and potential attrition.
“This research aims to shed new light on employee satisfaction and intent to leave in an era where engagement is at an all-time low,” Lydia Frank, vice president of Content Strategy at PayScale, said in a news release. “Our study shows that just by having an open dialogue about the pay process and employees’ contributions at the company, employers can ultimately drive better outcomes for their businesses.”
Another interesting finding is that when employees feel appreciated by their employer – and believe their company has a bright future – they are far more likely to be satisfied at work and remain at the company.
Other findings include: employees don’t know whether they’re paid fairly. Of the respondents who felt they were paid below market rate, nearly 90 percent were actually paid at or above market rate. That means only 11 percent of people who felt they were underpaid were correct; also, paying fairly really matters. The research shows 75 percent of respondents who think they are paid at or above the market rate said they were satisfied with their job, compared to only 59 percent of workers who felt they are paid below the market rate.
“This is provocative research that comes at a time when more and more companies are looking for ways to increase satisfaction with employees so they can get the biggest return from their talent investments,” said Pete DeBellis, research leader at the analyst firm Bersin by Deloitte. “The results are surprising and show us just how crucial it is for employers to make the leap and start talking more openly about pay in order to build more trusting relationships with their employees.”