Employee satisfaction – Tips for measuring and increasing it

January 2, 2023

Employee satisfaction is becoming an increasingly important competitive factor for employers. A lack of employee satisfaction leads to absenteeism and losses. Companies need to create long-term employee retention of top performers and employees by supporting them with their development and by creating positive working relationships within the company.

Likeminded Editorial Team

Table of Content

What is employee satisfaction?

Employee satisfaction, also known as work satisfaction, describes the attitude that employees have towards their workplace. It results from the expectations that employees have towards their workplace and their perceived reality. If expectations and reality are too far apart, employee satisfaction will be low. Satisfaction therefore results from a comparison of what a person expects from their workplace and that they actually find.

Which factors have an influence on employee satisfaction?

Employee satisfaction is influences by a range of factors. Generally, we can distinguish between hygiene and motivation factors.

When hygiene factors are not given, employees are likely to feel unsatisfied. Important expectations are not fulfilled, examples for these hygiene factors are:

  • General work conditions, such as work equipment
  • Helpfulness of colleagues
  • Appropriate compensation
  • Workplace safety (dismissal protection, financial stability of the company)
  • Adequate leadership

Motivation factors, on the other hand, increase satisfaction. The missing fulfilment of hygiene factors can balance our motivation factors only partly. Ideally, both factors are present. Examples for motivation factors are:

  • Experienced appreciation
  • Sense of achievement
  • Interesting work tasks
  • Opportunity for development e.g., opportunities to achieve new abilities
  • An appropriate degree of self-determination and self-responsibility

How are employee satisfaction and company culture connected?

During the last 20 years, we have experienced a turnaround in company cultures thanks to not only Silicon Valley: football tables, pods for short after-lunch naps, CEOs driving through the halls on Segways to get to the next meeting in time, smoothies for free after morning yoga on the company rooftop… The ideal recipe for employee happiness?

What sounds like an exciting, fast-moving company that seems to emphasize fun oftentimes has serious consequences for the employees’ mental health – and weakens employee retention in the long run.

With these changes, the boundaries between private life and work became increasingly blurred: longer working hours and resulting burdens and stress for employees due to the missing balance between work and free time.

Experts talk about delimitation which can have consequences such as loss of employees or physical and psychological illness. For companies, this means having to deal with expensive absences and fluctuation of employees, which intensify over time and affect all the other employees as well.

What are the consequences of low employee satisfaction?

Instead of creating long-term employee retention of top performers by supporting them in their development and fostering positive internal interaction, the War of Talent can lead to losses through recruitment by other companies.

Employee satisfaction cannot be established by simply putting a ping-pong table in the office. Instead, what is needed is for leaders to be mindful, open communication through managers and HR, and support in case of an emerging mental burden. The implementation of support measures, as well as a transparent company structure, will pay off: Investing in prevention measures ensures four times higher savings for companies in the long run.

Mental health and employees‘ productivity go hand in hand, but the task of mental care can be overwhelming for a lot of leaders. Likeminded offers different opportunities that help to enable a dialogue with colleagues and approach arising problems actively and preventively.

By 2021, more people than ever have left their jobs. The Great Resignation is also evident in Germany, where around 23% of employees want to leave their job within the next 12 months.

A study by the American Psychological Association shows that for employees who are particularly stressed, the probability that they will leave their current company is three times higher. This trend that has been getting stronger for years is evident in Germany as well and can be attributed to the missing work-life balance and missing support on the part of companies.

Likeminded offers different opportunities that help to enable a dialogue with colleagues and approach arising problems actively and preventively.

A 2021 study carried out by the company Forrester Consulting for Modern Health shows that 80% of surveyed employees (1215 in total) would be loyal to a company that actively supports mental health.

This finding would further depend on how engaged and successful employees were within their companies. Investigations carried out by Harvard Business Review show that this trend has become even more evident during the pandemic: Out of 1500 surveyed employees, 50% indicated that they left their job due to mental health issues, which marks an increase of around 47% in comparison to before the pandemic.

This is how you can measure and increase employee satisfaction sustainably

How can subjective and abstract feelings like happiness and satisfaction be planned? Companies can prioritize their employee experience, for example by appointing a leader for this area, who keeps a close eye on the different sectors – such as engagement, stress management, and work-life balance – and keeps in close contact with employees to name trigger points quickly. This exchange not only helps to give employees feedback but can also support them in recognizing their own strengths, strengthening these, or improving weaknesses.

Other ways to improve employee satisfaction are

  • Improving working conditions
  • Through an appropriate light concept and daylight
  • Modern work equipment
  • Rest areas for better concentration
  • Improving work-life balance
  • Offering flexible work models like home office, flextime, or parttime
  • Transparent communication
  • Establishing feedback culture, for example, regular feedback cycles, giving and receiving training for feedback, 360 degrees feedback, etc.
  • Open error culture
  • Employee newsletter
  • Determining clear development trajectories for different roles
  • Celebrating successes
  • Implementing offers to acutely support and preventively strengthen mental health

Happiness and satisfaction go hand in hand with appreciation. How can companies convey this appreciation? The catchwords are sensitivity and empathy, with which individual decisions for improving satisfaction can be made. Each employee is different and has different needs. Examples of this are flextime, bonuses for individual successes, and sensitive handling of personal needs.

Happiness and satisfaction go hand in hand with appreciation.

But how do people teams know how happy their employees really are?

Employee satisfaction did not appear out of nowhere when New Work gained popularity. By means of the ESI (Employee Satisfaction Index) or the MHS (Mitarbeiter Happiness Score), it is possible to measure employee satisfaction precisely. With the shift towards remote work, hybrid work models, and current crises, Likeminded created a new approach to measuring a team’s mental stability. This procedure is carried out entirely anonymously and can help to retrieve information about whether there is a danger of overload, stress, and burnout, which can then be prevented after the analysis.

The questionnaire was created based on scientific studies. These are a few examples:

  • How would you rate your current overall wellbeing?
  • How would you describe your current mental well-being?
  • How often do you feel burdened or overwhelmed?

With the help of this questionnaire by Likeminded, it is easier to recognize possible discrepancies within teams, stress, and early signs of burnout. The holistic offer that Likeminded provides helps with the anonymous evaluation and offers not only employee counseling sessions through a selected psychologist and educated coaches but also other self-learning offers or multistage 1:1 counseling sessions for prevention or crisis intervention, which can be used after completing the questionnaire. Group conversations within teams reveal trigger points and blocks early on so that they can be addressed in a neutral setting.

Raising awareness around the topic of mental health of employees is essential, especially for HR departments. Companies are doing only as well as their employees are. Download our template including interpretation instructions here to strengthen employee satisfaction and retention over the long term.

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