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Your best employees aren’t quitting—yet.
Disengagement is killing startups faster than competition. Here’s how to fix it before it’s too late.
Welcome back!
This week: Employee disengagement is hitting record highs—and it’s costing companies more than they realize. We’re breaking down why leaders are struggling to keep teams motivated and what actually works to turn things around. Let’s dive in.
Right now, employee engagement is at a 10-year low, and it’s costing companies big. But here’s the thing: it’s not just about salaries, perks, or even flexibility. It’s about something more fundamental—something most founders and execs don’t even realize they’re breaking.
The “invisible contract” you’re probably breaking
Every employee has an unspoken deal with their employer, called a psychological contract. It’s not about the paycheck—it’s about trust, fairness, and expectations. Things like:
✅ Am I growing here?
✅ Does my work actually matter?
✅ Is my boss invested in me?
When these expectations are met, employees are motivated, loyal, and engaged. When they’re broken? They quietly check out—or worse, leave. And the worst part? You might not even see it happening.
How founders & execs break it (without realizing)
🚩 Overpromising in hiring (then underdelivering)
🚩 Failing to give clarity on expectations and career growth
🚩 Making sudden policy shifts (like yanking remote work away)
🚩 Ignoring employees’ concerns or recognition needs
Breaking this contract doesn’t cause an immediate resignation—it causes slow disengagement. Employees start doing the bare minimum, stop caring about company goals, and lose trust in leadership.
How to fix it before it’s too late
🔹 Be honest from the start. If you can’t offer career growth in the next year, don’t sell it in the interview. Misalignment leads to faster exits.
🔹 Check in—before people mentally quit. Ask real questions in 1:1s. “What do you need to succeed?” is better than “How’s it going?”
🔹 Recognize wins. A simple “Great job” isn’t enough. Employees want to know how their work impacts the company.
🔹 Don’t make big changes without a plan. Employees don’t resist change—they resist chaos. If you’re making a shift (return-to-office, restructuring, etc.), be clear on the why and the how.
Bottom line? Keep your promises.
Startups that get this right build teams that stay. And in today’s talent landscape, retention is your real competitive edge.
Are you keeping your side of the deal? If you’re not sure, it might be time to find out—before your best employees make the decision for you.
Supported by Upwork
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Technical AI Expertise: From data annotation to generative AI modeling, businesses need specialists to fuel the AI lifecycle.
Coaching & Development: Career coaching and training are booming as workers and businesses race to adapt.
Here’s the kicker: 48% of CEOs plan to hire more freelancers this year, tapping into agile talent to close skill gaps and stay competitive.
Want the full breakdown of the skills shaping the future of work?
Employees are more disengaged now than during the pandemic—here’s why
It’s hard to imagine, but employees felt more satisfied with work in the middle of a global crisis than they do today. Gallup’s latest report shows U.S. employee engagement has hit a 10-year low at 31%, down from 34% in early 2022. Other studies echo the trend: fewer workers feel invested in, supported, or even clear on what’s expected of them.
Why it matters: People thrive on stability and purpose—two things that feel increasingly out of reach. The uncertainty around career growth, AI replacing jobs, and shifting workplace norms has left many workers unmoored. Without clear communication and a sense of progress, disengagement sets in fast.
The disconnect:
Only 39% of employees strongly believe someone at work cares about them—down from 47% in 2020.
Just 30% feel their manager encourages their development, a drop from 36%.
And nearly half of employees (46%) don’t fully understand what’s expected of them at work anymore.
Why this is happening: Employees don’t just want flexibility—they want direction. Remote and hybrid work, while offering freedom, has weakened social ties at work. “Not showing up on-site prevents people from building sustainable long-term work relationships,” says Anna Tavis of NYU. Without strong connections, motivation fades, and so does productivity.
The fix? Make work feel meaningful. Gallup’s chief workplace scientist Jim Harter says engagement improves when employees feel valued, have clear expectations, and see a path forward. Small but consistent efforts—like structured check-ins, more recognition, and career development support—can rebuild trust and motivation.
The big picture: The economy and job market also play a role. Many employees feel stuck, either because they don’t see paths for advancement or because they’re holding onto jobs they don’t love out of financial necessity. If leaders don’t address this, they risk losing top talent not just to other companies—but to complete disengagement.
The takeaway: People don’t just work for a paycheck—they work for a sense of progress, connection, and purpose. HR leaders and managers have a huge opportunity to bring that back. When employees feel heard, supported, and valued, they show up—and that’s what drives real business success.
What we’re reading
HR Dive: Nearly half of employees say they’re subject to an NDA.
DHR Global: Workforce Trends Report 2025.