Employees Are Engaged in 2026: HR, What Are You Doing to Keep the Momentum Going?

Key Takeaways

• 64.2% employee engagement in 2025, up 1.6 points YoY
• Intent to stay hit 79.7% in 2025, three‑year high
• Inclusion scores 81%, making culture the top engagement driver
• Only 63.5% say employer encourages innovation, limiting AI experimentation
• 73.1% receive meaningful feedback, but coaching remains a gap

Pulse Analysis

The latest McLean & Company data shows employee engagement rebounding to a five‑year peak, even as global economic volatility reaches its apex. At 64.2% engaged workers, firms are seeing a direct link to profitability—research ties high engagement to four times greater earnings. This momentum is unusual in a downturn, suggesting that organizations that invest in employee experience can buffer against macro‑headwinds and protect talent pipelines.

For HR executives, the report underscores three strategic levers for 2026. First, inclusion and culture remain the strongest engagement drivers, with 81% of respondents rating inclusion highly. Building a culture of innovation—especially around AI experimentation—can close the 36.5% gap where employees feel unsupported. Second, while 73.1% of staff report receiving meaningful feedback, the shift from feedback to coaching is critical for career development, a current low‑scoring area at 58%. Upskilling managers with coaching toolkits will help translate feedback into growth.

Compensation and benefits, though lower on the retention hierarchy, still demand attention. Only 40% of employees are satisfied with their benefits, and the upcoming EU Pay Transparency Directive adds regulatory pressure. Effective listening programs that act on real‑time data can prioritize limited resources, ensuring that benefits, pay equity, and work‑life balance initiatives reinforce the broader engagement strategy. Companies that move beyond measurement to decisive action will be best positioned to sustain the engagement gains and the associated profitability boost into 2026 and beyond.