Nearly half of all employees, including managers, are likely to seek a new job in the next year despite reporting high levels of engagement with their work, according to new research. This trend, termed 'employee engagement retention decoupling,' challenges organizations that have long relied on engagement metrics to predict workforce stability and turnover, forcing a re-evaluation of employee loyalty.
Who Is Affected
The disconnect between engagement and intent to stay is evident across employee segments. A Firstup study of over 3,000 UK workers found the likelihood of seeking new employment within the next year is nearly identical for different roles, despite reported engagement levels. Specific groups include:
- Managers: 50% report they are considering leaving their jobs. This comes even as 83% of managers describe themselves as engaged or highly engaged.
- Office-Based Employees: 48% are likely to look for another job. This contrasts with data showing 76% of this group feel engaged at work.
- Hourly Workers: 47% say they are also considering a move within the next 12 months.
This phenomenon reflects a broader shift in the employee-employer relationship across the corporate hierarchy, not just a single demographic.
Understanding the Engagement-Retention Decoupling Phenomenon
The trend renders high engagement scores, long a proxy for a stable workforce, unreliable for human resources departments. 'This disconnect means that engagement alone is no longer a reliable signal of workforce stability,' stated Bill Schuh, CEO of Firstup, regarding the study's findings.
The data points to a paradox where employees can be satisfied with their specific tasks and roles but simultaneously disconnected from the larger organization. According to the Firstup report, a primary driver of this contradiction is a breakdown in corporate communication. The study found that up to 76% of respondents reported missing important announcements regarding company policy or procedures. This communication gap can leave even engaged employees feeling uninformed, undervalued, and detached from the company's mission and direction, making them more open to external opportunities.
Further data from a separate report by The NonProfit Times on the U.S. nonprofit sector shows a wider pattern of declining workplace satisfaction. According to their 2026 report, the overall U.S. employee engagement average has fallen from 35% to 31%. This broader decline in engagement could exacerbate the decoupling trend, as foundational workplace satisfaction erodes.
Beyond Engagement: New Drivers of Employee Retention
Beyond compensation, employees seek holistic support from employers. The Firstup study found respondents consistently prioritize organizations demonstrating care (50-55%), improving communication (42-54%), and providing better technological tools (37-44%). These factors indicate a desire for a more supportive, transparent work environment.
Concerns over job security and fair compensation also remain powerful drivers of attrition, independent of an employee's engagement level. The report from The NonProfit Times highlights these vulnerabilities. In its survey, the lowest approval ratings in the 'Your Job' category were for the statements "I Don’t Worry About The Security Of My Position" (73% approval) and "I Am Paid Fairly For The Work I Perform" (68% approval). "Job insecurity is real," said one expert quoted in the report, who noted that it takes a "thoughtful manager to manage the nervousness that actually messes up the workday."
This sentiment is reflected in declining perceptions of management. The same report found that employee approval for the statement 'My Supervisor Handles My Job Related Needs' plummeted from 97% in 2022 to 90% in its 2026 report. Similarly, approval for 'My Manager Treats Me Fairly' dropped from 98% in 2023 to 92% in 2026. This suggests that even if an employee is engaged in their tasks, a deteriorating relationship with their direct supervisor can be a decisive factor in their choice to leave.
Rethinking HR Strategies for Retention in a Decoupled World
In light of these findings, organizations may need to adjust their retention strategies to look beyond traditional engagement initiatives. The evidence suggests a critical need to invest in foundational elements of the employee experience, particularly communication infrastructure and management quality. "If organizations want to improve communication and drive critical business outcomes such as increased retention, productivity, and safety, they have to empower all employees with the right technology," said Nathan Lowis, Managing Director for EMEA at Firstup.
Some organizations appear to be responding by reinforcing core benefits. According to The NonProfit Times, there has been an uptick in the number of organizations paying 100% of employees' health insurance, which rose to 34% in its 2026 report after falling to 31% in 2024. This move addresses fundamental needs for security and care that engagement surveys may not capture.
However, it is also important to maintain perspective. Peter Burke, president of Workforce Research Group, noted in The NonProfit Times report that while declines in satisfaction are notable, the overall approval ratings remain high in many areas. "While we have seen employee engagement numbers drop in a variety of industry and regional programs, I feel like they are still very high and are to be celebrated," Burke said. "In other words, going from 97% to 92%, while a decrease, is still really quite good." This suggests that while the relationship between engagement and retention is changing, the goal should be to supplement engagement efforts with a renewed focus on communication, management, and foundational employee needs rather than abandoning them entirely.
