How to Connect the Dots Between Employee Engagement and Retention

Written by:Milica Jović
Published on: 12 February 2024 Reading time: 9 minutes

An engaged employee completes their work tasks with enthusiasm and is fully absorbed in the company’s mission. They consistently take positive action to contribute to the team, the goals of your company, and its reputation. Most importantly, engaged employees have a high sense of loyalty toward the company and stick around longer.


That said, it seems that the secret to employee retention is employee engagement. However, 85% of employees globally are not engaged, “creating $7 trillion in lost productivity”, studies show.


We’ll walk you through the connection between these two concepts and share how you can boost employee engagement to improve employee retention.


What is employee engagement?


Employee engagement is a measure of the degree to which your employees are invested emotionally and mentally in the work and life of their company. It goes beyond being a representation of job satisfaction because it reflects a deep connection and commitment to the company's mission, values, and goals.


Unlike straightforward metrics such as attendance or tenure, employee engagement is an indicator of active participation in company life.


Taking initiative, collaborating effectively with colleagues, seeking opportunities for personal and professional growth, maintaining a positive attitude even in challenging situations—these are all attributes of engaged employees, who typically demonstrate higher levels of performance and contribute to overall company success and profitability.


How does employee engagement contribute to employee retention?


Creating a company culture that makes employees feel engaged can significantly impact the average tenure in your organization, as reasons related to workplace culture and engagement have been the main causes of employees leaving their jobs.


Here are a few areas where you’ll most likely notice how employee engagement plays a crucial role in the following aspects of a workplace:


  • Increased job satisfaction: Engaged employees tend to experience greater satisfaction with their work due to their emotional connection and alignment with the organization's goals and values. Being satisfied with your work reduces the likelihood of seeking opportunities elsewhere.
  • Sense of belonging: Engaged employees feel a sense of belonging within the organization, leading to increased commitment and loyalty. They are more likely to remain with the company for the long term, which leads to higher retention rates.
  • Opportunities for growth and development: Organizations that prioritize employee engagement often provide opportunities for growth and career development. Engaged employees are motivated to enhance their skills and knowledge, and they are more likely to stay with an organization that invests in their professional development.
  • Positive work environment: Employee engagement initiatives, such as recognition programs and supportive leadership, contribute to a positive work environment. Engaged employees feel valued and appreciated, leading to higher levels of job satisfaction and retention.
  • Better relationships with managers and colleagues: Engaged employees usually have stronger relationships with their managers and colleagues. Supportive relationships in the workplace create a sense of community and belonging, reducing employee turnover as people are less inclined to leave a supportive work environment.
  • Higher productivity and performance: Engaged employees are more productive and perform at a higher level compared to disengaged workers. Their dedication to work and the organization translates into improved performance, which is valued by employers and contributes to higher retention rates.
  • Resilience in challenging situations: Engaged employees are more likely to endure business challenges such as hypergrowth, mergers, or economic downturns. Their strong sense of purpose within the organization enables them to weather uncertainties and remain loyal to their employer. 

Did you know? Gallup found that engaged employees significantly contribute to customer satisfaction: businesses with engaged team members might see up to 10% higher customer ratings. Happy employees = happy customers!

7 actionable tips to improve employee engagement and retention


From onboarding to professional development, there are many opportunities for you to ensure retention of your top talent by helping them feel connected to the organization and motivated to do their best. We’re sharing seven tactics that will help you build a solid engagement strategy.


1. Start with streamlined onboarding


Effective onboarding sets the tone for an employee's entire journey with the organization. The more detailed and structured, the faster the new employee starts to be productive in their role.


During onboarding, your goal should be to set clear expectations for your new team member, introduce them to the company culture and values, and provide the necessary resources and support for them to succeed.


A well-executed onboarding process ensures that employees feel welcomed, informed, and prepared for their new role. This positive experience fosters early engagement and sets the stage for long-term commitment to the organization.


How to achieve your goal: Implement a structured onboarding program that includes personalized welcome messages from team members, clear job expectations, training sessions, regular one-on-one check-ins with the direct manager, and mentorship opportunities. Assign an onboarding buddy or mentor to new hires to facilitate their integration into the team. Use HR technology to automate repetitive tasks during onboarding and free up the new team member’s time for more meaningful work.


2. Nurture a positive workplace culture


A positive workplace culture encompasses the shared values, beliefs, and behaviors within an organization, where trust, respect, collaboration, and a focus on employee well-being characterize interpersonal relationships. Employees are treated fairly, they are encouraged to take ownership and responsibility for their work, and are rewarded for excellent results.


In a positive work culture, employees feel valued, supported, and motivated to contribute with their best work. Engaged employees are more likely to thrive in such a culture, leading to higher levels of job satisfaction and retention.


How to achieve your goal: Organize team-building activities, social events, and voluntary work opportunities to foster camaraderie and strengthen relationships among employees. Encourage open communication, celebrate achievements, and recognize employees who embody the organization's values. Make sure the senior leadership leads by example and participates actively in such events.

Top tip: Running a hybrid team? Employees who don’t regularly work on-site may feel lonely or excluded, which often gets overlooked. Rely on technology to learn how your remote team is feeling. HeartCount is a simple way to keep a pulse on the general sentiment of your team and react promptly if any employee satisfaction metrics are below your benchmarks.


Business growth and the expansion of remote work challenged organizational culture, communications, and interpersonal connections in many companies. Employers need to know how their employees are doing when working from home and don’t come into the office every day. Tools like HeartCount save your time and allow you to spot trends fast even in big companies with teams in different locations.” —Tijana Andjelic, CEO at HeartCount

3. Ask employees for feedback—and act on it


Regularly soliciting feedback from employees through employee engagement surveys and pulse checks, focus groups, or one-on-one meetings allows leaders to understand their needs, concerns, and suggestions for improvement.


Actively listening to employees demonstrates that their voices are valued and their input is considered in decision-making processes. Addressing their feedback helps to improve morale, engagement, and retention by showing employees that their opinions matter.


How to achieve your goal: Pulse surveys don’t mean much if you don’t take your time to analyze the feedback and act on it by developing action plans to address key findings. Share the findings transparently during all-hands meetings and townhall sessions to involve the employees in the process and encourage them to voice their own suggestions.

Did you know? HeartCount’s dashboard allows you to track key employee satisfaction and engagement metrics in real time! This allows you to reduce turnover rates and boost retention as you can react quickly if you notice any alarming responses by your employees.

4. Help employees connect with their purpose


When employees feel connected with their purpose within an organization, this means their personal values, strengths, and passions are aligned with their responsibilities at work.


If you help create a sense of meaning and fulfillment in your employees’ roles by emphasizing the impact of their contributions to the organization's mission, and potentially broader than that, they’re more likely to stick with you for longer.


How to achieve your goal: When you have performance reviews with your team, don’t just focus on what they’ve done well and what they could have done better. Talk to them about their career aspirations, goals, and things they’d be proud to achieve for themselves, their team, and the organization. Encourage your employees to reflect on how their work contributes to the organization's mission and the positive impact they make on customers, colleagues, and overall society.


5. Prioritize employee well-being


Employee well-being encompasses the physical, mental, and emotional health of your team members. Implementing initiatives to support work-life balance, stress management, and overall wellness can help your employees feel valued as human beings and avoid burnout, physical illness, and other negative symptoms, given the alarming fact that 25% of people believe their jobs are the number 1 source of stress in their lives.


Focusing on employee wellness can positively impact their performance and productivity according to 90% of employers, and consequently helping boost your engagement rates.


How to achieve your goal: Implement policies and programs that promote work-life balance, such as flexible work arrangements, remote work options, and wellness initiatives. Provide resources and support for mental health and stress management, such as employee assistance programs, mindfulness training, or counseling services. Additionally, encourage regular breaks, promote a culture of self-care, and lead by example, by showing that the leadership also prioritizes the wellbeing of their team.


6. Show employees that you appreciate them


Employee recognition involves acknowledging and rewarding employees for their contributions, achievements, and commitment to the organization. This can take various forms, including verbal praise, awards, bonuses, promotions, or other tangible incentives.


Recognizing and appreciating your employees reinforces positive behaviors, boosts morale, and fosters a sense of pride and loyalty. When employees feel valued and appreciated, they are more likely to remain engaged and committed to their roles.


How to achieve your goal: Establish a formal recognition program that celebrates the accomplishments, milestones, and exceptional performance of your employees. Recognize individuals and teams during meetings, through company-wide announcements, or with personalized notes from leadership. Last, but not the least, make sure your appreciation is also reflected in employee compensation. Regular raises and tailored perks are key to attracting and retaining top talent.

Did you know? HeartCount offers a public peer recognition tool called “Kudos”. This feature allows employees to give and receive kudos, or add to someone else's praise. The peer recognition is visible to the whole company and is saved in the employee's record, so that it's never forgotten and retrievable at all times.

7. Give employees opportunities to grow and develop


Employees are more likely to feel engaged if they can visualize their professional growth within your organization and if you can help them create a career path with opportunities to develop their skills.


Whether you offer training programs, educational resources, mentorship or career advancement opportunities, investing in employee development demonstrates a commitment to their long-term success and career progression. This will make the employee more likely to want to stay with your company for a longer period of time.


How to achieve your goal: Offer regular training sessions, workshops, and access to online learning platforms to help employees develop new skills and stay updated on industry trends. Implement a mentorship program where experienced employees mentor junior staff, providing guidance and support for career development. You can also create clear pathways for career advancement and encourage talks about professional growth during performance review cycles.


How to measure employee engagement?


Monitoring and measuring employee engagement in your company can help predict employee retention rates and develop strategies to improve them. Here are a few ways in which you can measure employee engagement.


  • Employee pulse check metrics: Through employee pulse checks, you can collect the data necessary to measure different employee engagement metrics, such as response rate, participation rate, employee engagement index, and more. By measuring these metrics, you can learn about the overall sentiment within your company, predict retention rates, and more.
  • Turnover rates and tenure analysis: Monitoring turnover rates and analyzing employee tenure provides insights into employee retention and engagement. High employee turnover rates may indicate dissatisfaction or disengagement, while longer tenures suggest a more committed workforce.
  • Recognition and appreciation metrics: Tracking metrics related to employee recognition and appreciation, such as the frequency of recognition events, nominations for awards, or participation in appreciation programs, provides insights into the level of appreciation and morale within the organization. Higher levels of recognition and appreciation often correlate with increased engagement and satisfaction among employees.


Related: Should you Measure Engagement or Happiness?


  • Engagement with development opportunities: High employee engagement with development opportunities, such as training programs, workshops, or mentorship initiatives can indicate their interest in learning and growing within the organization. Actively engaged employees seek out and participate in these opportunities to enhance their skills and advance their careers.
  • Attendance: Tracking employees attendance provides indicators of their commitment and engagement with their work. Consistently high attendance rates may suggest a strong sense of responsibility and engagement, while frequent absences or tardiness may indicate disengagement or dissatisfaction.
  • Performance metrics: Evaluating employee performance against established metrics and goals provides insights into their engagement and motivation levels. High-performing employees who consistently meet or exceed performance expectations are likely to be more engaged and motivated in their roles and look to grow within the organization, indicating their intention to stay.
  • Internal promotion rates: Analyzing internal promotion rates and the percentage of job openings filled internally highlights opportunities for career advancement and growth within the organization. Higher internal promotion rates indicate a culture that values employee development and engagement.
  • Employee Net Promoter Score (eNPS): The eNPS measures how likely an employee is to recommend their organization as a place to work. You can calculate it based on a single survey question asking employees how likely they are to recommend their workplace to others. A higher eNPS score indicates greater employee satisfaction, engagement, and loyalty.

“Over the past few years, we’ve noticed a positive trend in employee satisfaction metrics at companies that use HeartCount. This indicates success of our “people-first” initiatives, where organizations actively use feedback mechanisms available in our platform for early identification and tackling of issues in employee satisfaction. This approach is efficient at stopping the ‘snowball effect’ — situations where employees become very dissatisfied and start considering looking for a new job.” — Dušan Mihajlović, Product Owner & Head of Data & Analytics at HeartCount

Build a happy and engaged workforce for long-term success


By implementing the tactics we shared in this guide, you can create an environment where employees feel valued, motivated, and committed, leading to increased productivity, retention, and overall success. Investing in employee engagement is not only crucial for the well-being of employees but also for the sustainable growth and prosperity of the organization as a whole.


HeartCount is a user-friendly, easy-to-implement employee engagement tool that can help you reduce workforce management costs, gain real-time insights into employee satisfaction, and predict turnover fast and easy—so that you have just enough time to come up with solutions to reduce it.


Check out our platform for free throughout 14 days in three simple steps or book a demo with our team right away.