Gallup: Global Employee Engagement Hits Five-Year Low

Global employee engagement has fallen by 20% in 2025, according to Gallup's 2026 State of the Global Workplace report. This marks the lowest levels of employee engagement since 2020.

Jon Clifton, Gallup’s CEO said the report establishes “a global baseline for management effectiveness in the AI era.” 

“Businesses are investing heavily in AI, but the results are not showing up in the bottom line. Gallup's data points to an answer the corporate world has largely ignored: the manager,” he adds.

So what must HR leaders do to correct this? HR Chief Magazine takes a deep dive into the report to discover the three most important takeaways.

Managers are no longer the solution 

Employee engagement fell by two percentage points from its 2023 peak to 2025, according to Gallup. 

Managers are also less engaged, as engagement levels have dropped five points in a 12-month period – from 27% to 22% – marking the largest year-over-year increase. 

This highlights that managers, who historically enjoyed an "engagement premium" over individual contributors, are now no more engaged than the employees they lead, suggesting that traditional management structures may no longer provide the insulation from disengagement that they once did.

The report also stated: “In 2025, Gallup found that within best-practice organisations, 79% of managers were engaged at work — nearly quadruple the global average.

“These world-class workplaces span all regions and industries, prioritising employee engagement as part of their long-term business strategy.”

For HR leaders, this represents a fundamental shift in strategy. Engagement can no longer depend on manager effectiveness. Instead, organisations must address why managers themselves are disengaging – and whether current organisational structures, workloads and career paths are sustainable for leadership roles.

AI investment needs manager buy-in

As CEO Jon highlighted – there is a clear gap between technology spending and business results. 

However, managers are named as being key to employees' perceptions of AI value. 

In fact, within US organisations investing in AI, employees whose managers actively support their team's use of AI are 98.7 times more likely to report that the technology has transformed how work gets done. 

They are also 97.4 times more likely to agree that AI creates opportunities to focus on their core responsibilities. The disparity underscores the critical role manager engagement plays in determining whether AI investments yield measurable organisational change.

Additionally, employees working under managers who do not actively support AI adoption report significantly lower perceived value from the technology. This suggests that without deliberate manager leadership on AI integration, organisations risk wasting billions in technology investment while missing opportunities to increase employee satisfaction.

Businesses are missing $10 trillion in opportunity

Last year’s low engagement reportedly cost the global economy US$10tn in lost

productivity, or 9% of GDP. Each percentage point of engagement represents approximately 21 million employees.

The report measured employees' psychological attachment to their work, their team and their employer, with Gallup’s meta-analyses consistently showing that “a strong relationship between employee engagement and business-unit productivity, including profitability and sales.”

The report states: “While engagement occurs at the team level, employees who are not engaged or actively disengaged lead to less profitable organisations, which, in turn, translates into lower economic growth.”

This data highlights that engagement from people operations should be seen as an initiative to a business strategy imperative – rather than just a “nice to have”.

As a result, when HR leaders present engagement programmes to finance and operations teams, they're identifying a strategic operation that can unlock trillions in global productivity.

For a median-size S&P 500 company, this translates to US$228m to US$355m in annual lost productivity from disengagement and attrition. The math is compelling: small improvements in engagement yield enormous business returns.