Hong Kong, November 14, 2013 – As organizations continue to struggle with economic volatility and uneven growth patterns, a new analysis by Aon Hewitt in Asia Pacific, the global talent, retirement and health solutions business of Aon plc (NYSE: AON), finds that overall employee engagement and employees’ perceptions of their work experience remained static or slightly declined. These results diverge from global engagement trends, which improved within the same time frame.

“The importance of Asia Pacific as an engine of growth has sparked increased interest in understanding what motivates employees in this region and what are the factors that have sustained that growth. The 2013 Asia Pacific Engagement Trends Report provides great insights into what drives engagement and keeps employees motivated”, said Rick Payne, Performance, Reward & Talent practice leader for Aon Hewitt in Asia Pacific.

The research report provides insights into Asia Pacific employee engagement, which is seen to be an excellent barometer of organizational health. “By examining employee engagement, employers can create an engagement strategy to augment motivation, behavior, productivity, and subsequent business results. The report concludes with suggested actions that leaders and managers can take to improve employee engagement levels, and accordingly better position the organization for future success”, said Gabriela Domicelj, Engagement Practice Leader with Aon Hewitt in Asia Pacific.

Key Findings of Aon Hewitt’s 2013 Trends in Asia Pacific Employee Engagement

Asia Pacific’s overall employee engagement levels remained unchanged, although global engagement levels have improved. The research report demonstrates that, although employee engagement levels rose two percentage points globally (from 58% to 60% in the past two years), they have stayed constant in Asia Pacific at 58%. The drop in GDP between 2010 and 2011 was greater in Asia Pacific than in other regions, which has led to a lagged impact on employee engagement levels. “We believe that employers exercised caution in their employee investments in response to these economic conditions. Out of the eleven countries presented in the report, five saw an improvement in employee engagement levels in 2012 and six experienced a score decline, said Domicelj”. Indonesia’s 5% improvement was the highest within Asia Pacific (from 66% to 71% engaged employees), while Hong Kong experienced the highest drop in employee engagement levels (from 58% to 50%).

• In Asia Pacific, 17% of employees are actively disengaged, which aligns with the global trend. While 58% of employees in Asia Pacific are considered engaged; 42% are not engaged–either passive (25%) or actively disengaged (17%). It is important to note that Asia Pacific employee engagement scores are slightly more clustered around the moderate or passive range, while highly engaged employee levels fall below the global average.

• Engagement drivers differ substantially by country. Talent management practices vary greatly in maturity across countries and industries in Asia Pacific. Operating in this complex environment presents a challenge for leaders trying to drive high levels of employee engagement. Organizations that invest in understanding and managing the key drivers of employee engagement across their multiple constituencies will be able to drive performance in more efficient, effective ways.

Asia Pacific Engagement Distribution

An analysis of overall Asia Pacific employee engagement trends hides the economic dynamism and diversity of this region, which exhibits the widest range of employee engagement scores, as compared to any other region. In 2012, Asia Pacific employee engagement levels ranged from 34% in Japan to 71% in Indonesia. Six out of eleven countries experienced improvement in their 2011-2012 employee engagement score–Australia, China, Indonesia, Japan, Korea, and New Zealand; five experienced score decline–Hong Kong, India, Malaysia, Singapore and Thailand.

Japan has the lowest employee engagement score in the region at 34%. Japan has traditionally had low employee engagement levels; in fact, theirs are the lowest globally. Clearly, culture influences this result, but we also believe that business practices play a role in this constant trend. Although the Japanese economy now has a strong focus on the service sector, people management practices have not transitioned at the same pace as the rest of the economy.

Indonesia has one of the highest employee engagement scores in Asia Pacific.  Stable GDP growth and maturing HR practices in organizations operating in Indonesia have contributed to this result.

A Call to Action for Leaders: Improving Employee Engagement in Asia Pacific

The findings from Aon Hewitt’s 2013 Asia Pacific Trend Engagement Report signal a call to action for leaders to make employee engagement a business imperative. Aon Hewitt leadership research finds that such efforts often succeed or fail based on the intensity of leadership’s interest, understanding and involvement in engaging employees in their organization’s success. Aon Hewitt believes leaders in Asia Pacific organizations 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—Consistently showing up as one of the most important employee engagement drivers across all Asia Pacific countries, 41% of employees do not believe that they have good advancement opportunities with their current employer. Our research shows that this is a key area of opportunity to improve employee engagement, especially for Generation Y employees in Asia Pacific. Organizations with flexible, but clearly defined, career paths,, along with options for short-term assignments and geographic transfers, will differentiate themselves from other organizations and achieve higher levels of employee engagement. Correspondingly, there should be a focus on improving people management capability to enable leaders to conduct meaningful career conversations with their employees.

• Pay—Only a third of Asia Pacific employees (33%) think they are paid fairly for their contributions. This driver has been rising in the ranking over the last two years in some Asia Pacific countries. Employees’ perceptions of pay fairness have improved slightly, but the absolute score is still very low. The findings around pay indicate that economic pressures, threats of inflation, and historical pay constraints may have caused pay to represent more than just “hygiene” and to be more highly sought after in specific Asia Pacific countries.

• Recognition—Recognition schemes are certainly less costly for an employer than direct pay and can also have a significant impact on employee engagement. Employees want recognition for their performance, but only 31% think they get this recognition. Recognition practices in turn will pay off in with sustained or even higher employee engagement.

• Reputation—When asked “Does your organization have a positive reputation in the job market?”, only 31% of employees answered this question positively. Yet, reputation is ranked as the fourth most important employee engagement driver in Asia Pacific. With this weak result, it is difficult to attract the talent needed for organizational success. Organizational reputation is a function of business performance, social responsibility and general perceptions. Reputation is also built on the opinions that people in the job market form of the organization as a potential workplace.

• Brand Alignment—It is important that organizations are consistent in the promises they make to their employees, and the experience the employees receive once on-board. Only 50% of Asia Pacific employees confirmed that their organizations delivered on the promises made to employees. This represents a great opportunity for organizations. Those who focus on articulating a unique and compelling employee value proposition for prospective and current employees, and then subsequently deliver on that proposition, will be rewarded with higher employee engagement.

Employee engagement functions as a leading indicator of business performance. It helps mitigate the challenges encountered by organizations at times of economic volatility and drives future growth. Aon Hewitt believes that employee engagement is leadership’s responsibility and that now is the time to act.

Click here to download the full report: 2013 Trends in Asia Pacific Employee Engagement

Click here to register to the December 3^rd, 2013 webinar on 2013 Trends in Asia Pacific Employee Engagement

.# # #

Sign up for News Alerts:  http://aon.mediaroom.com/index.php?s=58
Follow Aon Hewitt on Twitter @AonHewitt

About Aon Hewitt

Aon Hewitt empowers organizations 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 organizational 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 65,000 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.

Media Contacts:

Romy Serfaty
852 2917 7952
romy.serfaty@aonhewitt.com