London, 22 May, 2013 – A new analysis by Aon Hewitt, the global talent, retirement and health solutions business of Aon plc (NYSE: AON), has found that employee engagement and employees’ perceptions of their working experience are continuing to show modest improvement despite the continuing economic difficulties in Europe.

Aon Hewitt’s annual study of more than 2,500 organisations, representing 3.8 million employees, found that employee engagement levels in Europe rose to 57% in 2012, up from 52% in 2011 and 51% in 2010.

The way employees perceive their overall work experience also improved in 2012. Areas with the highest increases in employee perception scores in Europe were:

■ Effective communication (+10%)
■ Brand alignment (+10%)
■ Recognition (+9%)
■ Career opportunities (+8 %)

The top five drivers of engagement for European employees were:

■ Career opportunities
■ Organisational reputation
■ Pay
■ Work processes
■ Innovation

All of the top five engagement drivers for 2012 improved which helps to explain the overall increase in engagement levels in this region.

In the UK, engagement levels have stabilised at 47% having fallen from 52% to 47% between 2010 and 2011. Communication is one of the top five engagement drivers in the UK and the driver where there has been the most significant increase in employee perceptions scores (+7 percentage points). Organisations seem to be doing a better job of keeping employees informed about what is going on and the path forward although there is still much room for improvement.

Jenny Merry, Engagement Practice leader for Aon Hewitt in the UK, said:

“Organisations in the UK and across the European region are paying more attention to employee engagement, with improved focus on action planning and supporting managers and leaders, and more focus on the drivers that make a difference. There is still some way to go but this is starting to have a positive impact on the overall perception that employees have of their work experience.”

An important finding in these analyses is the relative position of pay in the European key driver rankings (third), as well as the relative improvement in positive perception scores (+2%).

Jenny Merry continued:
“It is no surprise that pay has become a more important engagement factor – we are in a period when living standards have declined across much of Europe, and managing personal and family budgets has become an issue for an increasing number of workers.

"Furthermore, employers are now faced with a new generation of younger and highly demanding employees who expect higher and more individualised financial as well as non-financial rewards. Groups of employees may have very different needs and preferences when it comes to pay and benefits. Too often employers do not understand these needs as they simply do not ask their employees.

“Engaging the right employees in the right behaviours is the critical ingredient for successfully managing through diverse economic conditions. Our research shows that organisations with higher levels of engagement relative to their peers during economic recession also have higher growth in the years that follow. We expect that organisations which actively manage employee engagement today, will have a better shot at growth opportunities in the future.”

Engagement levels by region
Aon Hewitt’s analysis showed 2012 engagement scores varied by region. The largest engagement increases were in Europe (improving by 5%) and Latin America (improving by 3%). In North America, engagement dropped slightly to 63%, the lowest score since 2008. Asia Pacific’s engagement scores remained consistent with those from 2011.

Engagement by segments
Aon Hewitt’s analysis showed differences in engagement levels by job level and generation. Not surprisingly, executives and senior managers were the most engaged (66%), followed by middle managers, team leaders and supervisors. Professional employees, such as engineers, lawyers and nurses, had the lowest level of engagement globally, with only around 55% being engaged.

Substantial differences in engagement by generation were also identified. Baby Boomers had the highest level of engagement , with 65%, followed by Generation X (58%) and Millennials (55%).

Call to action – improving engagement levels
The findings from Aon Hewitt’s Global Engagement Trends report signal a call to action for leaders to make employee engagement a business imperative. Previous Aon Hewitt research into leadership has found that engagement efforts often succeed or fail on the extent of leadership’s interest, understanding and involvement in engaging employees in the organisation's success. Aon Hewitt believes leaders at global organisations are likely to get the highest return on investment in employee engagement if they take ownership of employee engagement and focus on improving the following drivers:

■ Career opportunities – For the fifth consecutive year, career opportunities remained the top driver to positively impact overall engagement levels for all regions globally, except for Latin America. Yet, less than half of employees (47 percent) think they have good advancement opportunities.

■ Reputation – Aon Hewitt's research showed that just 52% of employees know what their organisation 'wants to be famous for' in the market, yet this is the second most important engagement driver globally. Without a clear and concise organisational response to this question, it is difficult to attract, retain and engage the talent needed for success.

■ Pay – Globally, pay as an engagement driver has been on the rise in importance over the last two years.
This year’s ranking has significant implications. Pay freezes and lower bonus payouts over the last few years may have begun to impact overall employee engagement. It could also mean that with changing workforce demographics, hot talent wars and the decline in traditional retirement security, the concept of loyalty to a company may be eroding. Employees may be very mercenary as job opportunities open up for higher pay.

Media Contacts:    

Colin Mayes                                       Adam Leviton
Aon Hewitt                                         Capital MSL
01372 733689                                     020 7307 5339
colin.mayes@aonhewitt.com               adam.leviton@capitalmsl.com
 

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About Aon Hewitt
Aon Hewitt empowers organisations and individuals to secure a better future through innovative talent, retirement and health solutions. We advise, design and execute a wide range of solutions that enable clients to cultivate talent to drive organisational and personal performance and growth, navigate retirement risk while providing new levels of financial security, and redefine health solutions for greater choice, affordability and wellness.  Aon Hewitt is the global leader in human resource solutions, with over 30,000 professionals in 90 countries serving more than 20,000 clients worldwide.  For more information on Aon Hewitt, please visit www.aonhewitt.com.

About Aon
Aon plc (NYSE: AON) is the leading global provider of risk management, insurance and reinsurance brokerage, and human resources solutions and outsourcing services. Through its more than 61,000 colleagues worldwide, Aon unites to empower results for clients in over 120 countries via innovative and effective risk and people solutions and through industry-leading global resources and technical expertise. Aon has been named repeatedly as the world's best broker, best insurance intermediary, reinsurance intermediary, captives manager and best employee benefits consulting firm by multiple industry sources. Visit www.aon.com for more information on Aon and www.aon.com/manchesterunited to learn about Aon's global partnership and shirt sponsorship with Manchester United.