FINANCIAL COST OF EMPLOYEE DISENGAGEMENT
ENGAGED
EMPLOYEES ARE
GOLD DUST, BUT
ALSO PRETTY
RARE.
“According to a
recent study by
CIPD, 61% of UK
employees are
either unengaged,
or actively
disengaged, at
work.”
WHAT’S THE BIG DEAL?
Disengagement doesn’t only have
ramifications from a cultural perspective.
Disengaged employees incur enormous
financial costs to a business; costs that
are very often underestimated.
Hay Group’s report on Employee
Disengagement estimates that it is
costing the UK economy £340bn
every year in lost training and
recruitment costs, sick days,
productivity, creativity and innovation.
That’s a big number, and not one that
translates easily to every day costs
on an individual business level. That’s
why we have built The Perkbox Cost
of Disengagement Calculator – to help
you put a number on the sum of money
your business could be losing through
disengagement.
Cathy Temple, Senior HR Director, UK,
IRE and Israel at Oracle, comments:
“Absenteeism and employee morale
can significantly impact a business’
overall productivity and can be just as
disruptive as more obvious productivity-
killers like IT issues.
“The cost of absenteeism manifests
itself in different ways. It’s not only
the salary of the absent employee,
but in some cases the additional cost
of providing other resources to cover
the work, or the added pressure on
colleagues while that person or people
are out of action.”
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THE PERKBOX ‘COST OF
DISENGAGEMENT’ CALCULATOR
The Perkbox calculator takes the main measurable impacts associated
with disengagement – increased absenteeism costs, recruitment
costs, and training costs – and calculates how much extra a year your
disengaged employees could be costing you.
ABSENTEEISM
COSTS
A report from KPMG
revealed that disengaged
employees take 2.3 times
the number of sick days of
engaged employees.
HOW DOES THIS
TRANSLATE IN
FINANCIAL TERMS? *
A DISENGAGED
CARE WORKER
19.75
Average sick days
taken a year
£1842
RECRUITMENT
COSTS AND
TRAINING COSTS
Disengaged employees are
four times more likely to
leave a business.
WHY IS THIS A
FINANCIAL ISSUE? *
2O%
Cost of the average
salary to recruit a new
employee
1-2 YRS
Time taken for new
employee to reach the
productivity level of an
existing employee
Cost to businesses per
year
7.6%
Average care workers
salary
£11,2OO
Annual financial loss
per employee who
churns within the first
year
*Based on an average UK salary
of £27,6OO