5 Useful Employee Satisfaction Metrics to Track

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5 Useful Employee Satisfaction Metrics to Track

Organizations are increasingly taking steps to talk about employee satisfaction, but not everyone defines it and measures it in the same way. Employee satisfaction has a strong correlation between so many important people’s practices for organizations, such as intention to stay, productivity, and organizational culture. To get the most out of employees, you need to ensure there is a strong focus on employee satisfaction and track employee satisfaction metrics.

What is employee satisfaction?
How to measure employee satisfaction with employee satisfaction metrics
Always-on surveys

What is employee satisfaction?

Employee satisfaction, in simple terms, is how happy an employee is with their job and work environment. Typically, the factors that make up employee satisfaction include remuneration, stress, leadership, management, teamwork, employee experience, company culture, and work-life balance – although there could be multiple factors.

The factors that underpin employee satisfaction are often what HR teams and business leaders try and improve. However, it’s essential to understand that this may not always lead to employee satisfaction – as several other things may influence an employee. For example, if someone works as an accountant but has always wanted to be a chef – a direct effort to improve the employee’s satisfaction may not always be possible.

Tracking employee satisfaction metrics helps your organization understand how satisfied your employees are and where the potential for improvement is.

Employee satisfaction vs employee engagement

Two concepts that are often confused but are also intertwined are employee satisfaction and employee engagement. On the surface, they are similar concepts, but they actually measure different outcomes. William Kahn, founding father of the concept of engagement, defines employee engagement as: “the harnessing of organization members’ selves to their work roles; in engagement, people employ and express themselves physically, cognitively, and emotionally during role performances.”

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Employee engagement and employee satisfaction, therefore, go hand in hand.  An engaged employee is generally satisfied with their job, whereas a satisfied employee is not necessarily engaged with their job. That’s the critical differentiation – an engaged employee is likely to go over and above their call of duty to perform at their job. This might include working slightly after hours, having the motivation to help colleagues, or doing extra projects to improve the overall business performance. In their daily work, they show dedication and enthusiasm. On the other hand, satisfied employees won’t necessarily go beyond their scope of responsibility.

In general, employee satisfaction can be considered a prerequisite or a base for employee engagement.

How to measure employee satisfaction with employee satisfaction metrics

While we have established that employee satisfaction is important, it is also equally important to measure it regularly. However, it is not a straightforward metric, as it is multi-faceted. Rather, there are several quantitative and qualitative data points that organizations can use to assess employee satisfaction. We explore some of the common employee satisfaction metrics below: 

1. Employee net promoter score

Probably one of the most popular HR metrics is the Employee net promoter score (eNPS). This is a metric that is measured by the question “On a scale from 1-10, how likely are you to recommend this organization as a place to work?” or “Based on your experience, how likely are you to recommend our organization to a friend or colleague?” 

Based on the responses, you can break it down into detractors, passives, and promoters, for example

  • Promoters – Employees that respond either 9 or 10, which is an indication that an employee is satisfied. 
  • Passives – A score between 7 or 8, that indicates the employee is neither happy nor unhappy but feels neutral. They won’t recommend the company to a friend, but they won’t bad mouth them either. 
  • Detractors – Any employee that gives a score below 6, which indicates that the employee is not satisfied.

To calculate your eNPS, the formula is: 

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eNPS formula

Any score that is above 0 is okay. However, a score between 10 and 30 is good, and anything above 50 is excellent. You should be concerned if your employee NPS is -10 or lower.

2. Absenteeism rate

Workplace absenteeism is an indicator of many things, such as poor working conditions, poor governance, bad leadership, or a lack of work-life balance. It can also be an indicator of employee satisfaction – as a high absenteeism rate correlates with low employee satisfaction. Absenteeism is a behavior that can also have a severe knock-on effect. A higher absenteeism rate results in a greater workload for employees, which in turn causes more stress and job dissatisfaction rate as a result. To calculate employee absenteeism rate, use the below formula:

Absenteeism rate formula

3. Employee turnover rate

Job satisfaction is inversely related to turnover intention. Turnover is one of the highest costs for any organization, and a lower turnover leads to less disruption, greater productivity, and more cohesion. The more satisfied an employee is, the less likely they are to resign. When employees are supported, have good relationships, are being developed, and feel challenged in their work, they are likely to have a longer tenure with the organization. 

To calculate employee turnover, use the below formula:

Turnover rate formula

4. Glassdoor.com rating

Employee satisfaction also has a big impact on employer branding. Before an employee is likely to interview with an organization, the first thing they are likely to do is to ‘Google’ them. One of the most popular employer review sites that always appears is Glassdoor, which has established itself as a leading authority on reviewing workplace satisfaction and making that information publicly available. Therefore, focusing on employee satisfaction is not only an internal priority but also affects an organization’s ability to attract talent externally.

Ratings on Glassdoor are based on employee feedback, on a 5-point scale: 

  • 0.00 – 1.50 Employees are “Very Dissatisfied”
  • 1.51 – 2.50 Employees are “Dissatisfied”
  • 2.51 – 3.50 Employees say it’s “Okay”
  • ​3.51 – 4.00 Employees are “Satisfied”
  • ​4.01 – 5.00 Employees are “Very Satisfied”

Glassdoor also uses an algorithm to emphasize recent reviews to give them more weight. This is to give viewers the most up-to-date satisfaction score at the company. Former employees also post their comments about what it is or was like to work there. Poor employee satisfaction will reflect in both the quantitative and qualitative data shown on Glassdoor. 

Typically, the rating you see on a company profile is the overall rating of all approved reviews that the company has ever received after applying our proprietary algorithm, which among other factors, weights recent reviews more heavily than older ones. It usually takes seven business days for a rating to be updated after an employee leaves a review. 

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5. Employee satisfaction index (ESI)

The Employee satisfaction index (ESI) uses three questions to measure the extent to which employees are satisfied with their jobs. The three questions, as specified by Hubstaff, are as follows: 

  • How satisfied are you with your workplace?
  • How well does your workplace meet your expectations?
  • How close is your workplace to your ideal job?

All questions are measured on a scale from 1 to 10. 

The formula to calculate ESI is:

ESI Formula

The result of the ESI will give a score between 0 to 100. The higher the number, the more satisfied employees are. This is a good yardstick to measure improvement over time. Because it is only three questions, it is best to embed them in a more extensive survey. A larger survey should also allow for an open-ended answer to find out what precisely the frustration points for employees are and also to understand what can be improved.

Some examples of questions you might include in a larger employee satisfaction survey include: 

  1. Management supports me in my job.
  2. How well does your workplace meet your expectations?
  3. I am provided with all the tools to do my job effectively
  4. I am provided with enough training to do my job effectively. 
  5. I feel I am growing in my career every day.
  6. How satisfied are you with your workplace? 
  7. I understand what is required of me in my job.
  8.  I am satisfied with the opportunities for development.
  9. I have a reasonable amount of work that is manageable.
  10. How close is your workplace to your ideal job?

The questions in italics indicate the ESI questions and show how you can embed them in a larger survey. During analysis, you can bring the three questions together to get an ESI score. 

Here are some open-ended questions you could ask:

  1. What can we do differently as an organization to make you happy?
  2. What do you like about your job?
  3. What do you not like about your job?
  4. How could we make work more meaningful for you?
  5. What would make you look for another job at another company?

Gathering data

There are several ways to gain this data. If you’re in a really large organization, using a survey may be more effective because of time, scalability, and cost. Secondly, irrespective of whether you’re a large or small organization, gathering the above type of data could be personal. Therefore, anonymity is of high value if you want employees to provide honest feedback. You may want to use a funnel approach to gain general data and then more specific data. 

This could include: 

Organization wide survey > Focus groups > Team survey > One-on-one

The organizational-wide data gathered will provide you with information you need to make to company policies and procedures. Conducting employee focus groups will give you additional insights to work with. During team surveys, the data you gather will help you understand what you need to improve for team satisfaction, such as more team building or restructuring ways of working. Finally, your one-on-one conversations with employees will allow you to understand what you can do individually to improve employee satisfaction, such as training and development, change in job structure, flexible work schedule, or more regular feedback outside of traditional performance reviews.

Always-on surveys

While traditional annual surveys that measure employee engagement and satisfaction are important, they should be a tool that should be used as part of a broader plan. If satisfaction and engagement are measured annually, then by the time an employee is unhappy, the changes from the annual survey may be too late! 

That’s why many organizations have moved to always-on or pulse surveys. These are perhaps weekly or daily pop-ups that appear as push notifications on web browsers, emails, or on mobile phones, which are small check-ins with employees. Chatbots are also a popular way of sending these types of questions. The questions in these short employee surveys are usually simple and include:

  • How are you doing today? (Sad, Good, Amazing!)
  • How happy are you with the work you’re doing? (Not satisfied, Satisfied, Very satisfied)
  • Do you feel you are getting the necessary training every day? (Yes, No)

This is a way of getting live data and real-time response in addition to your other employee satisfaction metrics. It enables you to make decisions sooner rather than later. Organizations also use emojis to make it simpler for employees to answer without feeling they are being hassled daily to answer questions. This is a good way of getting a barometer on the current satisfaction levels of your employees daily, weekly and monthly.

To sum up

Tracking employee satisfaction metrics helps you understand if your workers are happy with their jobs. Depending on the results, you can implement improvements and then continue boosting employee satisfaction and, with it, employee engagement. This will help your organization improve overall employee wellbeing and retain top talent.

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