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2018 Trends in GlobalEmployee EngagementGlobal Employee Engagement Rebounds to Match Its All-Time High

Table of ContentsExecutive Summary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1Employee Engagement Defined. . . . . . . . . . . . . . . . . . . . . . . . . . . 2About the Study. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3Key Findings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4Engagement by Country . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6Global Employee Engagement. . . . . . . . . . . . . . . . . . . . . . . . . . . . 7APAC’s Big Rebound . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8A Softening in Latin America?. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9North America: Economic Growth Neutralizes Political/Social Anxiety. . . 10A Clearer Path in Europe. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11Africa Surges Forward. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12What Is the Employee Experience That Will Really DriveEngagement? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13Final Thoughts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15About Aon’s Employee Engagement Practice . . . . . . . . . . . . . . . 15

Executive SummaryGlobal Employee Engagement Returns to All-Time HighAfter last year’s dip – the first since 2012 – employee engagementmatched its all-time high. This rebound is driven largely from the biggestmarkets in Asia and a major surge in engagement in Africa.Continental Europe also saw improvements in engagement, while the United Kingdomrepresented the biggest decline among the 29 largest markets examined in this study.That seems to signal a drop in stability in the U.K., while many markets across Europehave a better understanding of what Brexit means to their economies and workforces.Like a year ago, the Rewards & Recognition dimension was the strongestdriver of engagement globally, followed by Senior Leadership, Career &Development, Employee Value Proposition and Enabling Infrastructure.The biggest surprise in this year’s report is the overwhelming importanceof “the future.” Employees want more exposure to senior leadership andstrategy. Strengthening of skills and gaining relevant knowledge that can beapplied later in their tenure are also in high demand among employees.Global Trends in Employee EngagementEmployee engagement reached its apex in 2015, dropped in 2016 and matched the previous peak in 2017.Global EngagementEngagement 1220132014201520162017YearAon1

Employee Engagement DefinedThe concept of employee engagement is often confused with satisfaction orhappiness, but the true definition is deeper in meaning. Employee engagementis defined as “the level of an employee’s psychological investment in theirorganization.” The Trends in Global Employee Engagement Study measuresemployee engagement with a “Say, Stay, Strive” model. Employees are asked: If they Say positive things about their organization and act as advocates. If they intend to Stay at their organization for a long time. If they are motivated to Strive to give their best efforts to help the organization succeed.The Aon Engagement ModelThe Aon Employee Engagement model below provides a complete pictureof the business impact of engagement, employee engagement itself andthe factors of the work experience that lead to higher engagement.In addition to measuring employee engagement, this study also measures 16work-experience dimensions: Career & Development, Collaboration,Customer Focus, Decision-making, Diversity & Inclusion, Empowerment/Autonomy, Enabling Infrastructure, Employee Value Proposition (EVP),Manager, Mission/Values, Performance Management, Rewards & Recognition,Senior Leadership, Talent & Staffing, Work Tasks and Work/Life Balance.The Aon Engagement r focusDecision-makingDiversity & InclusionEnabling onAgilityBrandTheWorkExperienceTheBasicsThe BasicsThe BasicsJob securityRiskSafetySurvey kWorkThe WorkEmpowerment/AutonomyWork tasksWork/Life BalanceJob Satisfaction2018 Trends in Global Employee nessOperationalEnaging LeadershipSenior LeadershipThe ManagerTalent FocusBrandCareer & DevelopmentPerformance ManagementRewards & RecognitionTalent & NPSRetentionStriveFinancialRevenue/sales growthOp. income/marginTotal shareholder return

About the StudyEvery year Aon measures employee engagement for more than 1,000 companiesaround the globe. This study has been conducted using data from more than 8 millionemployee responses in 2016 and 2017. The responses come from organizationswith as few as 100 employees to the most complex organizations with hundreds ofthousands of employees. More than 60 industries are represented in the study.Aon Measures Engagement Comprehensively8m1,000employee responsescompanies globally60 industriesAon3

Key FindingsGlobal Engagement TrendsGlobal65%2ptsTop EngagementOpportunitiesLatin America64%75%0ptsTop EngagementOpportunities0ptsTop EngagementOpportunitiesRewards & Recognition 3Enabling Infrastructure-1Senior Leadership-1Senior Leadership 2Senior Leadership0Career & Development-1Career & Development 2Rewards & Recognition 1Rewards & Recognition0EVP 3Career & Development 1Talent & StaffingEnabling Infrastructure 2EVPLargest PositiveDimension Increases4North America0Largest PositiveDimension IncreasesEnabling Infrastructure 20Largest PositiveDimension IncreasesTalent & Staffing 3Mission/Values 5Talent & Staffing 2EVP 3Customer Focus 3Mission/Values 2Rewards & Recognition 3Diversity & Inclusion 2Work Tasks 1Enabling Infrastructure 2Rewards & Recognition 1EVP 1Career & Development 2Talent & Staffing 12018 Trends in Global Employee Engagement

Africa66%Europe5ptsTop EngagementOpportunities60%Asia Pacific2ptsTop EngagementOpportunities65%3ptsTop EngagementOpportunitiesRewards & Recognition 4Senior Leadership-1Rewards & Recognition 3EVP 6Rewards & Recognition 3Senior Leadership 4Career & Development 4Career & Development 3Career & Development 3Talent & Staffing 5EVP 4EVP 3Enabling Infrastructure 4Enabling Infrastructure 4Enabling Infrastructure 3Largest PositiveDimension IncreasesLargest PositiveDimension IncreasesLargest PositiveDimension IncreasesMission/Values 7Talent & Staffing 6Senior Leadership 4EVP 6EVP 4Talent & Staffing 3Talent & Staffing 5Enabling Infrastructure 4Enabling Infrastructure 3Work Tasks 5Career & Development 3EVP 3Enabling Infrastructure 4Rewards & Recognition 3Rewards & Recognition 3Aon5

Engagement by CountryAs this report shows, global employee engagement has rebounded after 2016’s drop.To better understand what’s behind the global trend we need to examine engagementlevels and year-over-year changes by region and market. There is a great deal ofvariability in both 2017 engagement as well as the engagement trend from the prior yearacross the globe. Some of the engagement-level variability is due to cultural differences.Other factors — like political or economic stability — can influence engagement.The graph below shows how the majority of markets had some positivemovement in 2017, with many of the biggest countries and economies pullingglobal engagement to its two-point improvement. We also see that there are farmore “outliers” for improving markets than there are for declining markets.Markets by Engagement Levels and Engagement TrendsEach circle represents a different country. The size of the circle represents the country’s percentage of the global workforce plus the percentageof the country’s global GDP. The color of the circle represent the country’s GDP growth. Dark red means a large GDP drop for the country,while dark green means a large GDP improvement.85%Kazakhstan80%75%Engagement Score 201770%65%RussiaBrazilColombiaIndiaMexicoSaudi laysiaS. AfricaSpain BelgiumS. rocco% of Global GDP& Labor tChina2017 Global Avg (65%)Nigeria2016 GDP Growth-3.6% to 0%0% to 1.9%2% to 3.4%3.5% to 4.9%5% 8.9%25%20%-8%-6%-4%-2%No Change 2% 4% 6% 8%Change in Engagement (2016-2017)62018 Trends in Global Employee Engagement 10% 12% 14% 16%

Global Employee Engagement“In the last year there hasbeen economic stabilityin more mature regionsand continued expansionin regions like Asia andAfrica. Although mostcompanies are continuingto face disruption anduncertainty, a robust,expanding economy meanscompanies typically areinvesting more in people,and that makes the workexperience much better formost employees.”–– Ken Oehler, Aon’s Global Culture& Engagement Practice Leader‘Say, Stay, Strive’ Scores—GlobalEngagement around the world rebounded to its all-time high of 65 percent ofemployees. The two-point increase from 2016 made up for the drop experienced theyear before. Most notable is the increase in Highly Engaged employees from 24 percentto 27 percent, which is even higher than the previous high in 2015. This suggeststhat now, more than ever, employees are ready to bring their whole self to work.Each of the three elements composing the engagement index improved. “Say,” whichmeasures employee advocacy, went from 68 percent of employees a year ago to 70percent this year. “Stay,” which measures the likelihood that employees will remainat their current employer, rose one point to 61 percent of employees. “Strive,” whichassesses willingness to give extra effort, improved by two points to 64 percent.The two-point improvement in engagement globally can be largely attributed tothe overall improvement in the Asia Pacific (APAC) region and its largest economiesof India and China. APAC improved by three points to 65 percent. Africa andEurope both saw improvements – by five points and two points respectively. BothLatin America and North America stayed flat – at 75 percent and 64 percent.Engagement Profiles: 2016 vs. 20172016Say61%Stay2 pts50%39% 38%40%1 ptEngagement Score70%201730%20%24%22% 21%27%15% 14%10%64%Strive0%2 yEngagedAon7

APAC’s Big Rebound“Executives and shareholdersshould be pleased to see thatemployee engagement hasincreased across APAC bythree points. Right acrossour region, having a highlyengaged workforce hasnever been more important.Many organizationsare undertakingtransformational changeprograms as they managetheir way through digitaldisruption, macroeconomicchallenges and needing tomeet the ever-changingneeds of their customers. Ahighly engaged workforcedelivers the innovation,agility and performance thatorganizations across APACrequire.”After experiencing a three-point drop in engagement for 2016, the APAC regionbounced back to its highest engagement level at 65 percent of all employees lastyear. Markets that fell a year ago surged back, led by the region’s largest countries –China ( 2 points), India ( 2 points) and Japan ( 2 points). Not only did engagementrise in these countries, but the economies in India and China continued to growsignificantly in both 2016 and 2017. Three of the smaller markets also contributed toAPAC’s rebound. Malaysia ( 4 points) and the Philippines ( 6 points) achieved outlierstatus, while Indonesia improved an incredible 15 points over the previous year.Only three of the region’s largest markets saw engagement fail. Thailand, Australia andSouth Korea each declined by a single point, while Singapore and Hong Kong stayed flat.Of the 16 dimensions measured, only two declined in APAC: Customer Focusdeclined two points and Mission/Values fell four points. The region’s engagementimprovements are not a surprise when considering the top drivers of engagementalso rose significantly. The Senior Leadership dimension (the region’s No. 2driver) improved four points, Rewards & Recognition (the No. 1 driver) rose threepoints and Career Development (the No. 3 driver) climbed three points.Employee Engagement: APAC vs. The WorldGlobal–– Stephen Hickey, Partner,Aon’s Head of EmployeeEngagement & Culture, AsiaPacific and the Middle East68%Say75%Engagement Score‘Say, Stay, Strive’ Scores—APAC70%65%65%61%60%55%1 pt59%62%2 pts66%2 ptsStayStrive82018 Trends in Global Employee 01450%Year62%Asia Pacific201520162017

A Softening in Latin America?The narrative in Latin America is not that engagement stayed flat; it’s that engagementdeclined in some key markets. Mexico, Brazil, Colombia, Argentina, Peru andChile all experienced drops in engagement. However, these drops were largelyoffset by strong gains in Costa Rica, the Dominican Republic and Venezuela.Mexico, the region’s second-largest economy, saw engagement fall slightly, from75 percent to 74 percent. This marks the second consecutive year of engagementdecline in the country. Brazil, which had a remarkable eight-point gain last year,effectively sustained that gain with a one-point decline this year. The region’snext two largest economies, Argentina and Colombia, had drops o