The real cost of employee disengagement, and what actually fixes it

How much does employee disengagement actually cost?

Gallup's State of the Global Workplace is the largest continuous study of how employees experience their work, drawing on surveys across more than 140 countries. Its measure of “engagement” is not job satisfaction; it is whether people are psychologically invested in their work and workplace. The distinction matters, because a satisfied but disengaged employee, comfortable, collecting a salary, contributing the minimum, is precisely the costly profile the headline number describes.

The figure has moved across report years, and the year matters. Gallup's 2023 report put the cost at $8.8 trillion; the 2024 and 2025 reports restate it at $8.9 trillion, holding at about 9% of global GDP. The 2025 report is the most recent, and it is the figure we use throughout this guide and across our corporate pages, so the number is consistent wherever you read it.

Behind the money sits a human trend going the wrong way. Global engagement fell to 21% in the 2025 report, down from 23%, the steepest drop since the early pandemic. Only about a third of employees describe themselves as “thriving” in life, and 41% report a lot of daily stress. Manager engagement, which Gallup has repeatedly shown drives the engagement of everyone they lead, slipped from 30% to 27%. When managers disengage, teams follow.

Is it a pay problem or a culture problem?

The most rigorous answer to the pay-versus-culture question came from Donald Sull, Charles Sull, and Ben Zweig, whose January 2022 MIT Sloan Management Review article, “Toxic Culture Is Driving the Great Resignation,” analysed an unusually large dataset: 34 million online employee profiles, tracking workers who left their jobs between April and September 2021, the peak of the Great Resignation, when some 24 million Americans quit, alongside 1.4 million Glassdoor reviews across the companies in the Culture 500.

The scale of the dataset is what makes the finding credible. Rather than asking people why they left, the researchers measured what actually correlated with attrition across millions of real departures. Compensation turned out to be a weak predictor, 16th of more than 170 factors, while a toxic culture was the single strongest, and 10.4 times more predictive than pay. Their top five drivers of attrition were a toxic culture, job insecurity and reorganization, high levels of innovation and constant change, failure to recognize performance, and a poor response to the pandemic.

What this means in practice

You cannot out-pay a culture problem. If good people are leaving, a richer salary band rarely holds them, because pay was not the reason. The same research identified shorter-term retention levers that do help, lateral career moves, flexibility, genuine social connection, predictable schedules, but the deep driver is whether the culture is one people want to remain inside.

What does poor wellbeing actually cost an employer?

Deloitte's figure comes from a YouGov survey of 3,156 UK working adults. The $65 billion (£51 billion) annual cost is notable not only for its size but for its composition. Most people assume the cost of poor wellbeing is absence, people off sick. In fact the biggest component is presenteeism: employees physically present but operating well below capacity, which Deloitte estimates at roughly $30 billion (£24 billion) a year. It is the cost you cannot see on an attendance report.

The trend line is worth noting too. The cost was about $57 billion (£45 billion) in 2019 and $70 billion (£55 billion) in 2021; the 2024 figure of $65 billion (£51 billion) sits between them, still far above pre-pandemic levels. And burnout is widespread: 63% of respondents reported at least one characteristic of it, exhaustion, mental distance from the job, or reduced performance, up from 51% in 2021. These are originally GBP figures for one country (Deloitte's UK report); we show the US-dollar equivalent at a recent rate of about $1.27 to the pound, with the original in parentheses. The point is the magnitude and the pattern, both of which generalise.

What is the ROI of investing in employee wellbeing?

Deloitte's return figure is an average across 26 studies conducted since 2011, which is what gives it weight: it is not a single vendor's claim but a synthesis. The headline is $4.70 returned per $1 invested, about a 470% return. More useful for decision-making is the breakdown by intervention type. The highest return, $6.30 per $1, came from organisation-wide culture interventions, the broad shifts in how an organization works, rather than individual fixes. Read alongside MIT Sloan, the pattern is consistent: culture is both the real driver of attrition and the highest-returning thing to invest in.

Wellhub's Return on Wellbeing Study (2024) surveyed more than 2,000 HR leaders across nine countries and reported a stack of converging numbers: 95% of companies that measure ROI see a positive return (up from 90% the year before), 77% report an overall return above 100%, 99% say wellbeing programs increase productivity, and 91% say healthcare benefit costs fell because of them. On the outcomes that boards care about, companies offering its program reported 43% better retention and up to 25% lower annual healthcare costs, and 24% of comprehensive programs achieved returns above 150%.

Why do so many wellbeing programs seem not to work?

There is a selection effect hiding in the good ROI numbers, and it is the most practical insight in this guide. The 95% positive-return figure describes companies that measure ROI. The implication is not that wellbeing magically pays for itself; it is that the organizations treating wellbeing as a real initiative, with a goal, a baseline, and a follow-up, are the ones that see, and capture, the return. The organizations that buy a perk, never define what it is for, and never check, are the ones who conclude it did nothing. They are often right about their own program, and wrong about the category.

Do retreats work better than workplace perks?

Put the four findings in a line and the conclusion assembles itself. The cost of disengagement is enormous and largely unmeasured (Gallup). Its driver is culture, not pay (MIT Sloan). The leak is everyday, in presenteeism and burnout (Deloitte). And the fix, when it is a genuine intervention in culture, returns several times its cost, provided you measure it (Deloitte, Wellhub). That is the case for taking team wellbeing seriously, and the case against the fruit basket and the annual offsite that resets nothing.

A corporate retreat can be either thing. A reward trip with a wellness hour bolted on is a perk, and it behaves like one. A retreat designed around a specific organizational question, burnout, trust, a team that stopped talking, and measured against that question before and after, is a culture intervention, the highest-returning category in the data. The venue does not determine which one you get. The design and the measurement do.

What actually works

The research points to a small number of principles that separate interventions that pay from perks that do not:

Start from a real question, not an activity.

The studies reward organisation-wide culture work over generic wellness. Define the actual problem, the team that stopped trusting each other, the managers running on empty, before choosing what to do about it.

Target culture and connection, not just individuals.

MIT Sloan and Deloitte agree that the biggest returns come from changing how the organization works, not from handing individuals an app. Connection, recognition, and trust are the levers.

Invest in managers first.

Gallup's data is unambiguous that managers drive their teams' engagement. An intervention that reaches managers reaches everyone they lead.

Measure it, before and after.

The ROI belongs to those who instrument it. Set a baseline, define what success looks like, and check. Without measurement you cannot capture the return, or defend the budget.

Where Lunita fits

This is the part where we tell you, plainly, where we come in, so you can weigh it. Lunita runs corporate retreats built to be the genuine version of the intervention the data rewards: designed around a real organizational question, focused on culture and connection rather than a bolted-on wellness hour, and measured against the question they were built to answer. It is the opposite of an offsite that changes nothing.

If the evidence above has made the case, the corporate silo lays out how we put it into practice: the problem in full, the method, how we measure it, and how to start. If the strain is more personal than organizational, our burnout retreat holds the individual version of the same work.

Frequently asked questions

Sources

• Gallup, State of the Global Workplace: 2025 Report
• Sull, Sull & Zweig, "Toxic Culture Is Driving the Great Resignation", MIT Sloan Management Review (January 2022)
• Deloitte, Mental Health and Employers: the case for investment, 4th edition (2024)
• Wellhub, Return on Wellbeing Study (2024)

Every figure in this guide is reported with its exact source and year. Where a figure has shifted across report editions, we name the edition we use. We do not approximate statistics.