Understanding and Improving Employee Morale

As a change management specialist, Consultant Kelsey Patterson has led TC clients of all types through workplace transformation efforts. As part of these efforts, she has seen the good and the not-so-good when it comes to employee morale.

Today, research indicates efforts to drive high morale are more important than ever. According to Gallup, only 33% of employees are engaged, reflecting a slight decline from the prior year. Putting a point on that statistic, unengaged or actively disengaged employees account for approximately $1.9 trillion in lost productivity nationally. So, what’s a leader to do?

Below, Kelsey dives into the concept of employee morale, why it is fundamental to organizational success, and what leaders can do when faced with morale-related issues.

Defining Employee Morale

At its core, employee morale is how staff feel about their work environment and their work. At The Clearing, we consider it a mix of attitudes that encompass satisfaction, investment, and enthusiasm. These concepts may sound similar, but each plays a unique role in shaping morale:

• Satisfaction centers on what employees are getting from their work, including pay, a connection to their organization’s mission, and the feeling that they’re making a difference.
• Investment refers to the balance between the effort employees put in and the rewards they reap — essentially, do they feel like the work they do pays off in meaningful ways?
• Enthusiasm is how proud employees are of their work, how much they talk about their role with excitement, and how eager they are to share their achievements with others.

When these three areas are thriving, employee morale is high. But when they lag, morale drops, which can have far-reaching impacts on both the individual and the organization.

The Impact of Employee Morale on an Organization’s Mission

Employee morale directly affects an organization’s ability to meet its mission. Positive morale strengthens productivity, fosters resilience, and helps employees bounce back from stress and adversity. A team with high morale doesn’t necessarily experience fewer challenges, but they can recover faster and stay engaged.

On the flip side, low morale has the opposite effect. Employees may become disengaged, doing the bare minimum or struggling to meet regular standards. Burnout is also a significant risk — when employees feel drained, even the desire to do more can’t overcome their exhaustion. Ultimately, low morale may lead to decreased productivity, which impacts profitability and, more importantly, the ability to fulfill your organization’s mission.

Morale also has an impact on retention. High morale doesn’t just keep employees productive; it also encourages them to stay. Employees who feel satisfied, invested, and enthusiastic are less likely to look for other opportunities.

The saying “the grass is greener where you water it” applies here — employees with high morale don’t feel the need to chase other opportunities because they’re already content where they are.

Conversely, low morale can be a large factor in employee turnover. When staff feel disconnected, undervalued, or burned out, they’re more likely to look elsewhere for work. Even if they aren’t actively job hunting, they’ll be more susceptible to outside offers or recruiter inquiries.

Measuring Employee Morale

As leaders, it’s crucial to identify signs of low morale early to take corrective action before it affects the entire team. Here are a few key warning signs to watch for:

• Decreased productivity and engagement
• Reduced participation in meetings or group activities
• Lower attendance rates or increased absenteeism
• Lack of collaboration between employees
• Negative or cynical attitudes
• Higher turnover rates

By paying attention to these indicators, leaders can address morale issues before they snowball into larger problems. There are also ways to measure employee morale that can help inform a leader’s observation. We typically categorize measurement into active methods and passive methods.

Include mechanisms like surveys, focus groups, and interviews where employees provide direct feedback. But be mindful — repeated long surveys can actually harm morale, especially if staff don’t see results or changes based on their feedback.

Involve analyzing data you already have. Look at HR metrics like retention rates, engagement in company events, or how many people open internal emails. Observing employee behavior in the workplace (e.g., are they collaborating or isolating themselves?) can also provide clues about morale levels.

Employing the right combination of active and passive methods will help ensure you’re taking a well-rounded approach to understanding and measuring your team’s morale.

Quick Tips to Improve Employee Morale

If you’re a leader facing low morale on your team, don’t panic — there are ways to address it. Start by using the methods above to consistently measure morale to understand trends over time. When morale dips, don’t feel like you have to fix everything at once. Focus on the most critical issues first, and be open with your team about what can and can’t be changed. Transparency goes a long way in maintaining trust.

Here are some practical tips to help improve morale.

• Involve employees in decision-making. They often have the best insight into what’s working and what isn’t.
• Foster collaboration and social interaction. People who feel connected to their colleagues are generally happier at work.
• Recognize and reward hard work. Whether through formal recognition programs or informal shoutouts, employees want to feel appreciated.
• Provide growth opportunities. Investing in your employees’ professional development signals that you value them and their future at your organization.
• Take inspiration from high-performing teams. Look at the departments with high morale and analyze what they’re doing right. Can those strategies be applied elsewhere?

Take Action to Improve Outcomes

As we discussed, employee morale is a powerful driver of an organization’s success, impacting productivity, resilience, and retention. However, it can also be a tough nut to crack. If your organization is facing morale issues, please reach out. Our team of workplace and culture experts would love to discuss how we can help determine the cause and implement a solution that works for your team to set the stage for long-term success.