Out of the Great Gloom? Employee Satisfaction Trends Upward

BambooHR Employee Happiness Index Shows Small Businesses Happier Than Ever

May 23, 2024

Are we still in the era of “This is fine,” or are we genuinely on the brink of progress? The beginning of 2024 has charted a path of increasing satisfaction at work, hinting that employee happiness could be climbing out of its four-year slump.
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Employee happiness cautiously crept upward in the first quarter of 2024, offering a glimmer of hope after years of decline. While the increase from Q4 2023’s average to Q1 2024 is modest at 1.6%, it marks a departure from the downward trends that have characterized recent years.

Despite this positive shift, employee satisfaction still falls short of the highs experienced back in 2020. Will this upward trend continue throughout the year? BambooHR analyzed eNPS® data from over 57,000 employees across eight key industries in this quarterly Employee Happiness Index report.

In this report, we delve into the early signs of a recovery in employee happiness, exploring whether 2024 can sustain this nascent optimism and providing HR professionals with valuable insights into employee feedback and sentiments.

Average of Overall eNPS 2020–2024

Looking back at 2023’s eNPS data, there’s been a two-point decrease from March 2023 to March 2024, marking a 6% decrease. eNPS has increased by 0.9% since December, which is notable given we’ve seen a decline in happiness at the start of the year for the last four years.

While this is the first year since 2020 we’ve had positive eNPS trends in Q1, employees are still less happy than they were at this time last year.

Editor’s Note: Respondent quotes were sourced from external interviews. All names and identifying information have been changed to protect privacy. Quotes have been lightly edited for clarity and concision.

Employee Satisfaction Key Takeaways

Key Takeaways by Employee Group

Employee Tenure: Employees with a tenure of less than 3 years continue to be happier.

Company Headcount: Employee happiness at smaller companies significantly outpaces that at larger companies.

Key Takeaways by Industry

Construction: Continues to take the lead with the highest eNPS since July 2021.

Travel & Hospitality: On the way up—highest eNPS scores since April 2020.

Education: Out of the slump, reaching its highest happiness since March 2021

Finance: Another four-year low, dropping to September 2023 levels.

Restaurant, Food, & Bev: A stronger start to Q1 in 2024 than the start of 2023.

Technology: Hit a new four-year low in February 2024.

Nonprofit: Shows improvement, recovering substantially from Q4 in 2023.

Healthcare: Still the unhappiest, but no decline—eNPS held steady from Q4.

Industry Comparisons Average eNPS 2023–2024

What’s Employee Net Promoter Score (eNPS)?

eNPS helps employers measure employee satisfaction. It consists of a numeric rating of how likely employees are to recommend the organization as a place to work. Employees select a score from 0–10, and these scores, categorized as Promoters (9 or 10), Passives (8), and Detractors (7 or below), are used to quantify how employees feel about their company.

The eNPS score is then calculated by taking the percentage of Promoters and subtracting the percentage of Detractors. The resulting score can range from -100 to +100, with higher eNPS scores indicating a higher level of employee satisfaction and loyalty:

  • Above 0 is good.
  • Above 20 is favorable.
  • Above 50 is excellent.
  • Above 80 is world class.

Net Promoter, NPS, and the NPS-related emoticons are registered trademarks, and Net Promoter Score and Net Promoter System are service marks of Bain & Company, Inc., Satmetrix Systems, Inc., and Fred Reichheld.

Which Employee Groups Are Happiest?

Q1 2024 marked a universal rise in average employee happiness across all countries from the previous quarter, indicating a global improvement in workplace satisfaction. We start to see some differences, though, when we look at different groups in the data—specifically, employee tenure and company size.

Employee Tenure Not Correlating to Happiness

New hires and tenured employees are no longer equal in happiness as they were for the second half of 2023. Employees who have been at their company for less than three years have seen an increase in overall average happiness to kickoff the year.

Companies with mostly new employees (less than 3 years average tenure) have 3% happier workers in Q1 than companies whose workforce is majority 3+ years tenured. Regardless of tenure, employees are still less happy than they were in previous years.

Employee Tenure Average eNPS 2020–2024

Small Businesses Happier Than Ever

People who work at smaller companies—those with fewer than 25 employees—were significantly happier in the first quarter of 2024 than those who worked at larger companies, with an eNPS of 51. This group of employees rated their average happiness 41% higher compared to their counterparts in small to medium-sized businesses (SMBs) or mid-market (MM) companies with 25+ employees. This trend is consistent with what we’ve seen since mid-2021, and the disparity has only become larger.

“The things that are not going well, like the major tech layoff of big companies, are not affecting me at all because I work for a pretty small start up. So I am experiencing a lot of positivity in my industry.”

Junior Software Developer, Small Technology Company

Company Size Average eNPS Q1 2024
1 - 24 EE
51
25 - 75 EE
43
76 - 150 EE
37
151 - 300 EE
31
301 - 500 EE
35
One reason for this disparity might be that smaller organizational structures are fostering a more satisfying or engaging work environment. Implementing employee feedback, recognizing employees for their work, and promoting transparency may be easier to do with a smaller headcount, all of which have been shown to boost employee happiness.

“The industry giants are just slashing jobs. Layoffs are out of control. It's in the back of your mind, will this affect me? So that's something that keeps me awake at night.

Automation Engineer, Large Technology Company

The graph below shows that smaller companies have stayed consistent or even increased in happiness for the smallest employee sizes, while the largest saw a drop in eNPS:

Company Headcount Average eNPS Q1 2024

The decline in eNPS at larger companies suggests the difficulty of maintaining employee satisfaction at scale. This drop could be attributed to various factors, such as inefficient leadership, slower decision-making processes, or the complexities of navigating large corporate structures, which may not be as prevalent in smaller settings.

This data points to the broader implication that company size and structure plays a crucial role in influencing employee happiness and satisfaction levels, and HR professionals need to take note of what is working well at smaller organizations and apply the same principles.

Regardless of the size of your company, businesses live and die by the strength of their managers, where employee needs and aspirations are heard and supported. Meaningful, personalized experiences and one-on-one relationships foster loyalty and satisfaction for customers, so why would employees be any different?

Anita Grantham | Head of HR | BambooHR

What Industries Have the Happiest (and Unhappiest) Employees?

Happiness is increasing among some industries, but others appear to be just “fine.” From construction to healthcare, the shifts in eNPS provide insight into what is and isn’t working well. In this section, we’ll look more closely at the trends across the eight industries tracked by BambooHR.
Ranking
Industry
Average eNPS Q1’24
Avg eNPS Q4’23 v Q1’24 Change
1
Construction
52
8% increase
+ 4 eNPS
2
Travel & Hospitality
41

8% increase

+ 3 eNPS

3
Education
38

9% increase

+3 eNPS

4
Finance
37
No change
5
Restaurant, Food, & Bev
37

4% increase

+2 eNPS

6
Technology
35
No change
7
Nonprofit
35
No change
8
Healthcare
33
No change

Construction

Construction Average eNPS 2023–2024

Highlights

  • Highest eNPS score: 53 in March
  • Average eNPS for Q1 is 52 compared to 48 in Q4
    • 8% increase from Q4 to Q1
  • eNPS is 3 points higher than March 2023, a 5% increase

Construction continues to remain an anomaly as the only industry with an eNPS over 50. The sector's happiness levels have not only held strong but have also shown significant improvement, reaching the highest eNPS score since July 2021, with a score of 53 in March 2024.

This upward trend is further evidenced by the average eNPS for the first quarter, which stands at 52—a substantial rise from 48 in the previous quarter, marking an 8% increase. These figures underscore the robust and growing employee satisfaction within the construction sector, setting it apart from other industries.

Rising happiness among construction workers correlates to increased spending on construction projects, rising wages in response to a severe labor shortage, and a variety of new builds from commercial to residential, according to International Banker. Employees are benefitting from the high demand for this industry.

Not everyone in construction is happy, though. According to one office manager for a custom cabinetry company, “Leadership has problems, which leads to unhappy employees.” Their recommendation is for leaders to offer more flexible schedule options, more affordable benefits, and more opportunities for better work-life balance.

Travel & Hospitality

Travel & Hospitality Average eNPS 2023–2024

Highlights

  • Average eNPS for Q1 is 41 (38 in Q4)
    • 1% decrease from Q4 to Q1
  • eNPS is 5 points higher than March 2023, a 16% increase
  • Rebound in 2024, reaching levels last seen during 2020–2022 after a low in 2023

For the travel and hospitality industry, February showcased an impressive recovery, with the highest eNPS scores recorded since April 2020, which reached 43. This was just before the pandemic severely impacted the industry's morale. The eNPS in March of this year was five points higher than last year, translating to a 16% increase from March 2023 to March 2024.

After facing a challenging year in 2023, the travel and hospitality sector has bounced back, reaching levels of employee satisfaction that parallel pre-pandemic years. This upward trend suggests a revitalized spirit among workers, likely fueled by a surge in demand for workers and renewed optimism in the industry.

According to one employee—a compliance officer at a casino—work-life balance is the most important factor to their happiness’ ”I've got a lot of flexibility, a lot of freedom, and a good amount of autonomy. I get to work from home often.” They encourage companies to consider ways to improve employee satisfaction, such as offering flexible working hours, as it demonstrates both their confidence in their employees to get the work done and their appreciation for the work they are doing.

“Good compensation and work-life balance are the ultimate goal.”

Marketing Manager | Leisure & Travel Company

Education

Education Average eNPS 2023–2024

Highlights

  • March had the highest eNPS scores since March 2021 (39.9)
    • Average eNPS in Q1 was 38, with Q4 being 35
    • 9% increase from Q4 to Q1
  • eNPS is 4 points higher than March 2023, an 11% increase

The education sector achieved its highest eNPS scores since March 2021, reaching 40 in March 2024. This peak is part of a broader upward trend observed in Q1 2024, with an average eNPS of 38, compared to 35 in Q4 2023.

The 9% increase from Q4 to Q1 marks the steepest rise among all industries this quarter. This significant improvement highlights a positive shift in employee sentiment within the education industry so far in 2024.

However, this increase in eNPS shouldn't be taken to mean that the teacher morale problem has been solved. Not all employees in the education sector are teachers, and in fact, the majority of K–12 teachers often feel stressed (77%) and overwhelmed at work (68%).

One teacher who has been in the field for 20 years said, “I increasingly feel my job is less about actual teaching and more about explaining my job to other adults.” They also cite problems with leadership, censorship, and testing requirements as contributing to their unhappiness.

On the flip side, a university instructor said, “I am generally happy because I enjoy working with students and facilitating the educational process. It’s rewarding—even though I'm not always rewarded financially—for some of those tasks that I do. There's a lot of work and it can be hard, but there are a lot of good aspects.”

Finance

Finance Average eNPS 2023–2024

Highlights

  • New four-year low at 34.4 eNPS in March 2024
    • Average eNPS in Q1 is 37, identical to Q4 2023
    • eNPS is 1 point lower than March 2023, a 2% decrease

Following a similar trend to the technology industry, the finance sector experienced a large decrease in Q1, dropping to a new four-year low—34 in March 2024. This decline is part of a broader negative trend observed in Q1 2024, with an average eNPS of 37, which remains unchanged from Q4 2023.

Declining employee happiness in this sector could be attributed to the failure of many financial institutions to meet the evolving compensation and benefits expectations of their employees, amid a tightening labor market and continuing high interest rates. These institutions are grappling with greater earnings challenges and difficulties in training staff on advanced technologies like AI, exacerbating existing recruitment and retention struggles.

Many of these points are echoed by one employee in the risk management department of a banking institution, who said, “Employees are not happy with having to go back into the office, and income has not kept up with inflation, which has spiked recently. However, I still work from home, so my happiness has not been affected by return-to-office mandates. Technology has allowed me to continue working from home and be productive.”

Restaurant, Food, & Beverage

Restaurant, Food, & Bev Average eNPS 2023–2024

Highlights

  • Average eNPS of Q1 is 37, with Q4 being 35
    • 4% increase Q4 to Q1
  • eNPS 3 points higher compared to March 2023, an 11% increase

Employee satisfaction in the restaurant, food, and beverage sector has begun to mellow out after a holiday-induced increase in Q4, showing a strong start to the year but no signs of continued increases. .

The average eNPS for Q1 stands at 37, slightly up by 4% from 35 in Q4. When compared to March 2023, the sector has seen a continued positive change, with eNPS being 3 points higher, marking an 11% increase.

The National Restaurant Association reports that sales are up in 2024—the food service industry is forecast to reach $1 trillion in sales this year, a first in history—and they project 200,000 jobs will be added by the end of this year. If employers in this sector focus on employee wellbeing and satisfaction, perhaps we’ll see retention and employee happiness increase substantially by the end of 2024.

Technology

Technology Average eNPS 2023–2024

Highlights

  • Average eNPS of Q1 is 35.47, compared to Q4 at 34.66
  • 2% decrease Q4 to Q1
  • eNPS is 8 points lower than March 2023, a 19% decrease

In February 2024, the technology sector recorded its lowest eNPS in the last four years, with a score of 35. This downturn is part of a continuing negative trend within the sector.

When compared to March 2023, the tech's eNPS has dropped by 8 points, marking a significant 19% decrease. This decline underscores the challenges the sector faces in maintaining employee satisfaction and engagement.

The two biggest factors affecting tech employees' happiness seem to be the massive layoffs that have happened over the last year and return-to-office mandates, with the most notable groups affected by RTOs being high-performing employees (16% less likely to stay) and women (11% less likely to stay).

One sales account manager in the tech space attributes unhappiness in the industry to return-to-office policies, which they say “don’t make sense and are completely against what workers want. It seems like C-level greed is taking over and everybody is unhappy right now.”

“I really like my job now. I like flexibility. I get to work from home in my office, and I only work four days a week. Because of that, I’m much happier.”

Automation & Software Engineer | Insurance Company

Nonprofit

Nonprofit Average eNPS 2023–2024

Highlights

  • Since December 2023’s four-year low, eNPS has increased 13%
  • Average eNPS in Q1 is 34, the same as Q4
  • eNPS is the same as March 2023

In the nonprofit sector, there’s been a notable improvement in employee satisfaction since December, which marked a four-year low in eNPS. From December to March, there’s been a 13% increase in the eNPS.

Despite this positive trend, the average eNPS has remained steady at 34 from Q4 to Q1. When comparing the current data to March of the previous year, the eNPS for nonprofits stands unchanged at 35. This indicates that while there's been a recent uplift in employee satisfaction, the sector has a long way to go to return to the score of 44 in 2020.

According to a recent survey by the New Jersey Center for Nonprofits, there's reason to be optimistic this positive trend will continue in 2024. More than half (56%) of survey respondents believed their nonprofit's overall circumstances improved in 2023, and they also predicted their situation would improve in 2024.

One nonprofit employee who manages volunteers at their organization was also optimistic about the upward trend and said, “People are recognizing it's not okay to not pay people a living wage just because they work for a nonprofit. Employers are finding themselves having to provide better benefits and better pay to workers.” A good salary alongside doing meaningful work is important to them.

“Having a small team and a healthy work culture has allowed me to feel like this is a job I can sustain. I've never really felt burnt out, which is pretty huge for nonprofits. We have good benefits, good work-life balance, and I get to do meaningful work and connect with people.”

Volunteer Manager | Nonprofit

Healthcare

Healthcare Average eNPS 2023–2024

Highlights

  • Q1 showed a marginal decrease from Q4’s average (1%)
    • Average eNPS held steady at 33 from Q4 to Q1
  • eNPS is 1 point lower than March 2023, a 3% decrease

Although healthcare workers’ happiness has improved since its lowest point in April 2023, the healthcare industry still records the lowest average eNPS of all industries at 33.

One key issue affecting healthcare workers’ according to Indeed’s Pulse of Healthcare 2024 report is burnout, with one in three healthcare workers experiencing burnout and exhaustion. Interestingly, the report notes this is not causing employees to leave the field entirely but rather find a new job in the industry.

A contributing factor to burnout the Indeed report identifies is underappreciation—42% of respondents reported feeling underappreciated by a manager or supervisor, along with 29% feeling underappreciated by their patients and 38% underappreciated by their coworkers.

One of BambooHR’s interviewees shines a light on the duality of this issue: “I really enjoy my job as a newborn care specialist. I can't believe I get paid to snuggle little babies.” However, this same specialist also observes that a lack of appreciation for healthcare workers may be a contributing factor to unhappiness, despite feeling optimistic that the tides are turning.

Addressing these issues could be crucial in improving satisfaction and retention within the industry.

What’s an HR Professional to Do?

Based on the insights shared by employees from different industries, here are the key employee satisfaction issues HR professionals should focus on:

  • Address Leadership Issues: Addressing problems in leadership can lead to happier employees and improved company performance. Ensure leaders are well trained and aligned with the company's values and goals.
  • Promote Work-Life Balance: Implementing flexible work schedules, such as a four-day work week or shorter, “summer” Fridays, and respecting personal time can significantly enhance employee satisfaction. Recognize the importance of time off for maintaining a healthy work-life balance.
  • Enhance Benefits: Review and improve benefits packages, especially health insurance at a time when premiums have increased, to make them more affordable and competitive. This not only supports the financial wellbeing of employees but also shows that the company values their health and overall wellbeing.
  • Recognize and Reward Employees: Regular recognition and feedback are vital. Acknowledge employees' hard work and provide constructive feedback to foster a positive work environment and encourage professional growth.
  • Support Remote/Flexible Work Options: Where possible, offer flexible working arrangements, including options to work from home. This can be particularly appealing to employees who prioritize work-life balance and may enhance job satisfaction and productivity.
  • Focus on Employee Development: Provide clear paths for career advancement and personal growth within the company. This not only helps in retaining talent but also ensures that employees feel valued and invested in.

About BambooHR

BambooHR® is the leading HR software solution that sets people free to do great work, by managing the complex work of supporting employees and succeeding as a business, while giving leaders all the data they need to make informed strategic decisions.

Intuitively designed and easy-to-use benefits administration, payroll, performance, time tracking, and reporting where everything works together means less focus on process and more focus on growing what matters most—people.

Over the past 15 years, BambooHR has been the trusted partner of HR professionals at 33 thousand companies with employees in over 190 countries and 50 industries, supporting millions of users throughout their employee experience.

Methodology

All source data is from BambooHR® Employee Satisfaction, gathered between January 2020 and March 2024, and includes more than 1,600 companies, tracking anonymized responses from over 57,000 unique employees since January 2020. Data analyzed includes more than 1.91 million self-reported eNPS scores. The most recent quarter’s data is added to the historical data set on the first day of the new quarter.

Industries included are healthcare, finance, construction, travel and hospitality, nonprofit, restaurant / food and beverage, education, and technology.

Further demographics included are company region, company headcount, and average employee tenure at a company.

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