12 Employee Engagement and Retention Strategies for 2025

Research suggests employee engagement relates strongly to employee retention. That said, engaging employees remains a challenge for HR teams. 

Unhappy and unmotivated employees can diminish workplace productivity, enthusiasm, and energy levels.

On other hand, engaged employees are more productive, create better workplace cultures, and are more likely to stay longer with a company.

That’s why by implementing effective employee engagement and retention strategies, you have the power to create an inspiring work environment that encourages staff to bring their best every day.

In this article, we’ll be discussing what engagement is, its importance, and the 5Cs of employee engagement. We’ll also look at employee engagement and retention strategies that you can try out at your organization.

What is employee engagement?

Before you explore engagement strategies, it’s important to define what employee engagement is. 

Employee engagement is more than just employee happiness. It's about the connection between employee satisfaction, productivity, and performance, and the overall impact on the workplace.

Engaged employees contribute actively, while disengaged employees may only be putting in time. Disengaged team members may also negatively affect overall workplace morale.

Engagement also allows employers to manage employee perspectives on key elements of the work environment.

Effective employee engagement strategies can lead to higher employee retention, reduced burnout, and can increase team productivity.

It’s, therefore, important for HR and team leaders or managers to evaluate team-building efforts. HR strategies should include individual and team engagement and measure employee engagement KPIs to identify areas of improvement. 

 Why is employee engagement important in the workplace?

As mentioned, employee and team engagement directly impacts productivity, retention, and overall organizational success.

A recent Gallup report found only 23% of employees globally are engaged, while the best-performing organizations boast 70% engagement

Here are some benefits of employee engagement:

• Employee retention rate

More employees are changing jobs. Nearly 82% of workers say they favor companies with a clear purpose. 

On the other hand, a high employee turnover rate is costly. The cost of replacing an employee can range from half to twice their salary. 

Additionally, frequent employee exits can hurt morale and indicate an unstable work environment, leading to further departures. Continuous training of new staff disrupts productivity and business performance.
 

Further reading: Benefits of Employee Retention: 10 Reasons Why It Matters

• Increased productivity

Another benefit of higher engagement is improved productivity, which can translate to larger outputs and profitability. Decreased productivity can lead to stagnation and losses. 

Engaged employees are 27% more productive and make 60% fewer mistakes. 

Therefore, prioritizing engagement is key to a more efficient and high-quality workforce.

• Impact on business success

Organizations with high employee engagement are not only more successful but also more profitable. 

According to Gallup, engaged employees contribute to 21% greater profitability, as happier and healthier employees are more productive. 

This leads to a positive company culture and improved customer service, and higher customer satisfaction. 

• Positive company culture

Positive company culture begins with employees. Engaged team members are not only connected to an organization's core values, but also to each other, to their work, and to fostering a supportive environment.

Company culture is a two-way street. It arises from team members working together and contributes to improved retention and performance. 

The Quantum Workplace 2022 Organizational Culture Research Report indicates over 60% of disengaged employees would leave for a company with a better culture. This figure drops to 23% among engaged employees.

• Effective leadership

Everyone desires a charismatic and approachable team leader with a clear vision.

Employee engagement starts at the top and flows down. Forbes reports 76% of employees with empathetic managers are highly engaged. This shows that managers who work on engaging their teams can greatly enhance overall performance.

The 5Cs of employee engagement in HRM

In human resource management (HRM), the concept of employee engagement takes the form of the 5Cs. 

In other words, if you follow those 5Cs, communication, connection, culture, contribution, and career development, you’ll have an engaged team and workforce.

Let’s see what this looks like.

• Communication: Clear communication promotes trust and keeps employees informed about business goals, updates, needs, and changes.
• Connection: Building strong relationships among employees and with leadership creates a supportive environment where everyone feels valued and motivated to collaborate.
• Culture: A positive organizational culture that emphasizes fairness and inclusivity fosters a sense of identity and pride among employees.
• Contribution: Acknowledging employees' achievements enhances their sense of worth and motivates them to excel. In addition, providing autonomy empowers them to make meaningful contributions and empowers them to make decisions and be more innovative.
• Career Development: Investing in employees’ growth through training and development programs not only enhances their skills but also encourages loyalty and retention. Some companies take it a step further and promote self-development among team members, offering incentives to help them achieve their personal goals.

Employee engagement and retention strategies for companies

Employee engagement and retention go hand-in-hand. Combined, they are the  key to a productive, motivated workforce. 

Here are several employee engagement and retention strategies to help you keep employees and teams connected and committed.
 

1. Conduct engagement surveys

To effectively improve employee engagement, you first need to first assess its current state within your organization. 

Employee engagement surveys are a valuable tool for this. The results of these surveys can help you identify areas of improvement, such as addressing feelings of being undervalued, lack of development opportunities, or inadequate resources. The insights gained from surveys can guide your engagement strategies.

2. Create a mentorship program

Mentorship supports skill development and career growth, increasing job satisfaction. Identify potential leaders in your company and see if they are fit for offering mentorship. 

Alternatively, you can consider the orientation buddy method used in employee onboarding and orientation processes.

3. Involve employees in decision-making

An effective employee engagement and retention strategy involves fostering employees' emotional connection and commitment to the organization.

A key method for achieving this is involving employees in company decisions, especially those that directly affect them.

You can accomplish this by empowering employees to define their goals and KPIs, and by encouraging managers to include their teams in decision-making processes.

This strategy is effective because it promotes employee empowerment, boosts ownership, showing the company trusts team members’ judgement and decisions. Empowered employees demonstrate higher engagement levels.

4. Recognize employee efforts

A strong employee rewards and recognition program can boost engagement and offer opportunities for growth. Consider creating a program as part of your company culture. 

Note that such a program may require expertise from an HR consultancy, like Tawzef, or you may explore employee rewards program software.

5. Implement a structured onboarding process

 A thoughtful onboarding experience ensures new hires feel welcomed and prepared. It can also play a significant role in how they mingle with other employees both in their teams and in other departments.

Employee onboarding can also help new team members understand the company’s culture faster and dive into their work faster.

6. Offer performance-based incentives

Consider offering incentives like bonuses or extra time off to encourage motivation and high performance. 

Benefits packages, including health insurance, wellness programs, and retirement options, increase employee retention and job satisfaction. They also attract top talent. 

Such incentives should be part of your compensation and benefits strategy. You can improve these incentives by measuring relevant compensation and benefits KPIs and through surveys to see what employees care about more.

7. Facilitate continuous training

Employee training is another two-way street. When team members receive training for tools and solutions, it improves their productivity and internal workflows. 

It helps them do their work faster, automate certain tasks, and can improve internal communication. 

At the same time, it shows companies are interested in investing in their employees because they too reap the benefits of this training. Benefits such as engaged, retained, and more productive team members.

For some companies, this can mean an opportunity to add more clients or manage more projects, leading to higher business revenues. 

8. Promote well-being

 Wellness programs and flexible work options are among the top employee engagement trends for 2025. 

Not only do they boost morale and reduce burnout, but employees are more interested in companies that consider their mental health and physical wellbeing over those that don’t.

9. Support hybrid or remote work

Another important workplace and engagement trend is hybrid and remote work. Although many employers have returned to full in-house work situations, employees are interested in remote and hybrid options.

Flexibility in work arrangements improves team members’ work-life balance, boosting productivity and retention.

Further reading: 15 Expert Tips and Best Practices for Managing Hybrid Teams

10. Encourage open communication

As mentioned, communication plays a key role in fostering collaboration and retention. It also boosts productivity. 

Actively seeking and responding to employee feedback fosters a respectful workplace.

Communication is the core of any effective strategy, including employee engagement and retention. 

11. Use 360-degree feedback

The 360-degree feedback approach serves as a valuable employee engagement and retention strategy. 

This method gathers input from various sources, including peers, managers, and even customers, to provide a comprehensive assessment of an individual's work style. It moves beyond a single supervisor's perspective and offers a more balanced and unbiased viewpoint.

This method helps employees understand their impact, identify areas for improvement, and fosters self-awareness, accountability, and growth. 

Further reading: What Are the Different Types of Performance Evaluation For Employees?

12. Conduct stay interviews 

Exit interviews are part of an HR’s role and can be an HR KPI. However, another factor that can contribute to employee retention is conducting ‘stay’ interviews.

Stay interviews are a valuable, yet underused, tool in employee engagement strategies for boosting retention. 

Instead of relying on guesswork, organizations should use stay interviews to directly gather employee feedback and improve satisfaction.

Conclusion 

Employee engagement is key in driving productivity, retention, and business success. Engaged employees are more motivated and contribute positively to company culture. 

Organizations that focus on effective leadership, recognition, and career development achieve higher profitability and growth. 

By fostering clear communication, mentorship, and well-being initiatives, companies can create a supportive environment where employees feel valued.

Investing in engagement enhances satisfaction and strengthens overall business performance, benefiting both employees and organizations.

Need help creating employee engagement programs for your organization? Reach out to Tawzef for HR and Consultancy.