Employee Engagement as Stock Market Indicator

Quantum Workplace issued an interesting press release last month showing a strong correlation between their employee engagement index (“measured by the ability and willingness of individuals to exert effort for the benefit of the company, speak highly of the organization, and intent to remain”) and the directional movement of the Dow Jones Industrial Average (a primary stock market indicator in the U.S.). Quantum’s index accurately predicted up or down movements of the Dow in 10 out 12 months.

Loosely translated, this means the better engaged employees are, the better the company will perform and, extrapolating, the better the economy will perform. Stay with me here. This makes good sense to me. Without employees, no company would exist. Without good, committed, hardworking employees, no company can become the top of its industry. Now, if more employees (as measured by this or other engagement tools) are reporting higher engagement levels, then they are working harder on achieving strategic objectives, making the company more successful. The more successful our companies are, the more stable the economy.

Let’s look at other Quantum research that shows employee engagement declining in 66% of organizations studied in 2008 over 2007. What would be the state of our economy if only 15% of those employees were more engaged? Keep in mind, these are currently employed staffers – they just aren’t working to capacity. Granted, there are many reasons why they may not be as engaged – stress, overwork, concern for their future.

But what are you doing to help them reengage, to boost their morale and productivity? Are you communicating with them more and recognizing their efforts that help achieve your objectives?