Maggie BleharJuly 24, 2023
Topics: Employee Experience

How to Track Employee Engagement: 5 Metrics to Improve Retention

Tracking and analyzing employee engagement metrics is important for improving employee retention. Why? Because engaged employees typically stay at their workplace longer and contribute to the organization more fully.

According to a Gallup poll, companies that had highly engaged workers outperformed their peers by 147% in earnings per share, on average. Another study found that when employees are engaged with their work, they’re more fulfilled and more motivated, ultimately leading to as much as 22% higher productivity.

Elevating the employee experience through strategies like learning and development, career pathing, mentoring, gigs, and Employee Resource Groups (ERGs) are all ways companies can boost engagement. From there, it's important to regularly track and review key performance metrics to identify what's working, what's not, and where improvements should be made to strengthen retention initiatives.

Here are five metrics for employee engagement that you should measure to help improve retention:


1. Turnover Rate

Turnover rate is the percentage of employees who leave the company within a specific period — usually calculated annually. Some employers might also track this at a deeper level, including:

  • Voluntary turnover rate: The percentage of employees who leave a company on their own accord. A high voluntary turnover rate could reflect issues with company culture, lack of growth opportunities, management styles, and more.

  • Involuntary turnover: The percentage of employees who leave a company for reasons outside of their control or wishes. A high involuntary turnover rate could reflect issues with the screening and interviewing process, onboarding, manager-employee relationships, and more.

  • Turnover rate by department or manager: The percentage of employees who leave a specific department or managerial position. Reviewing turnover by department or manager can help HR identify areas or people to invest its time and resources to benefit the organization.

No matter the type of turnover, it’s important to note that a high percentage usually indicates underlying issues with employee satisfaction and engagement. It’s also important to note that some turnover can be okay (not all employees will be the best fit for a company and vice versa), so you don’t want to target your turnover rate at 0%. The ideal turnover rate is an average of 10% or less per year.

You can calculate turnover rate using this formula: Employee departures / Average of total employees x 100 = Turnover rate

If you know your company's turnover rates, you can dig deeper into gaps to better retain employees in the future.


2. Average Length of Employment

Another employee engagement metric to study when looking to boost retention is tenure, also known as length of employment. Surprisingly, over the last 40 years, the median length of employment for salaried workers was steady at five years, with that number varying slightly by age, race, and gender.

The U.S. Bureau of Labor Statistics and the European Centre for the Development of Vocational Training track this data annually, so it can be a good metric to use when comparing yourself to other companies in your industry. If your company’s average length of employment is low, auditing your employee experience can reveal where current staff is experiencing challenges. Capturing why is also crucial, so sending out employee surveys to invite feedback is a best practice.

You can calculate average length of employment by using this formula: Collective number of years worked / Number of employees = Average length of employment

Related reading: The 5 Main Drivers of Employee Retention


3. Employee Satisfaction

Employee satisfaction is crucial. After all, if employees aren’t happy at your company, they will leave — especially Millennials and Gen Zers who prioritize work-life balance, mental health, and personal happiness over all. In fact, only 36% of employees report feeling engaged in their work and workplace.

To gauge employee satisfaction, you should regularly survey employees to find out what they like and what needs to be improved. In addition to regular surveys, an Employee Net Promoter Score (eNPS) is another employee engagement metric to rely on. An eNPS gauges how likely an employee is to recommend your company to others as a good place to work. Higher scores often correlate with better retention.

It’s important to note that new employee satisfaction should be its own metric, since new employees (those who have been at a company 90 days or less) are learning your culture, adjusting to their role, and may have different expectations than seasoned employees.

Finally, you can analyze employee satisfaction by looking at internal talent marketplace data to see if employees are browsing and/or applying to other jobs in the company. If they are, it’s a good indicator that they are happy at your company and can see themselves working there for the foreseeable future — but may be looking to go down a different career path.


4. Career Development and Training

There are copious studies that show that companies offering opportunities for career development and growth are more likely to retain their employees. Employees want to feel like they are learning and honing their skills. If they’re at a company that feels stagnant or lacks career pathing opportunities, they will leave. In fact, ​​63% reported that they left a job last year due to inadequate growth opportunities.

As a result, tracking the percentage of your workforce that leverages learning and development opportunities is another way to gain more insight into the health of your employee experience. For this employee engagement metric, track the number of employees who participate in training and development programs, or who have identified their next desired role, and compare it against those who haven’t. Be sure to also regularly survey employees who are participating in training programs to see if they believe they’re progressing towards their career goals.

There is not one way to measure this metric, so be sure to sit down with your team to decide what criteria is most important to the company.

Related reading: Building a Positive Learning Culture with Degreed


5. Diversity, Equity, and Inclusion (DE&I)

A diverse, equitable, and inclusive workplace can lead to higher retention rates, but according to Harvard Business Review, “employees who differ from most of their colleagues in religion, gender, sexual orientation, socio-economic background, and generation often hide important parts of themselves at work for fear of negative consequences.” That’s why it’s imperative to evaluate your company’s DE&I efforts and make changes accordingly.

Here are two ways to do this:

  1. Segment employee engagement survey results by minority groups to get a comprehensive picture of how all employees truly feel about working at your company.

  2. Assess the percentage of employees who participate in ERGs and survey what they like best about them, as well as what could be improved to foster more inclusivity at work.

Employees who feel comfortable expressing themselves — and who are celebrated because of it — are more likely to stay at your company, ultimately boosting retention.

Related reading: Diversity and Inclusion: The Definitive Guide for HR


When it comes to an employee experience that boosts retention, it’s important to analyze these employee engagement metrics for strengths and weaknesses. The more data the better, so if you find a metric missing from this list that you think would benefit your company-wide analysis, don’t hesitate to add it to your toolbox.


To dive deeper into strategies for boosting employee engagement and retention, download our
Definitive Guide to Employee Experience.

Maggie Blehar

Maggie is a writer at Phenom, bringing you information on all things talent experience. In addition to writing, she enjoys traveling, painting, cooking, and spending time with her family and friends. 

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