Has Employee Experience Already Run Out of Steam?

With the buzz about employee experience (EX) dying down, budgets being cut or frozen, and hiring slowing to a standstill, it’s fair to ask the question: has EX already shrunk into insignificance? 

In this article I’ll look at both sides of the debate, analyzing why EX is in danger right now, exploring the possibility of a healthier future, and what we as EX, HR, or communications practitioners can do to secure its long-term survival. 

An EX winter 

In its 2024 global predictions report, Forrester foresaw an ‘EX Winter’. This was to be characterized by a freeze or deep cuts on resources and budget, and an intentional lack of leadership focus, strategy, and sponsorship. For example, the number of companies that planned to fund a Diversity, Equity, and Inclusion function with an endorsed strategy and personnel was expected to plummet from 33% in 2022 to just 20% in 2024. 

It was a similar story on technology. While 66% of tech decision-makers were due to invest in EX-related software this year, spending was to be prioritized towards HR efficiency improvements, not EX outcomes. 

What can we do? 

Hold our nerve. The business rationale for inclusion is well-known and understood, so we should continue to push for DEI in the organizations we work with. That means challenging leaders on recruitment practices, putting forward investment cases, and calling out tokenistic gestures. 

On technology, we can highlight the opportunity for companies who ‘get it’ to be brave, focus on EX while their competition is sleeping, and reap the business benefits. 

Employee engagement hasn’t moved in 20 years

The harsh reality is that for all the progress made in certain areas of work, global employee engagement levels have remained static (around 20%) for 15 to 20 years. While employee engagement and employee experience are not the same thing, they are connected. If your people have a great EX, they are more likely to be engaged. So, persistently low levels of engagement are in part a reflection of a poor EX in many organizations. 

In Gallup’s State of the Global Workplace 2023, only 23% of employees were engaged at work – yet this was still the highest level since they began measuring global engagement in 2009. When the disengaged were asked, ‘What would you change about your workplace to make it better?’, 57% made references related to culture that EX can have a direct impact on – for example, receiving recognition or options to work from home (more on this later). 

What can we do? 

Focus on what we can control. Employee engagement is influenced by a broad spectrum of factors, some of which are outside EX’s sphere of influence. The key for us working in this space is to maintain the momentum on those areas that we know EX can make an outsized impact on, and don’t necessarily need huge budget – recognition and wellbeing come to mind as good places to start. 

The stand-off on return-to-office continues 

The tussle between employees and executives over unpopular return-to-office mandates shows no signs of abating. Interestingly, those companies that issued ‘get back in’ orders have seen no improvement in their financial performance. Yet from an EX perspective, 99% of them saw a drop in employees’ overall job satisfaction, according to research of 137 S&P 500 firms between June 2019 and January 2023.

These findings are backed up by the Qualtrics 2024 EX Trends Report, which found that employees who work five days in an office, or on-site location, had the lowest EX metrics. 
While companies continue to give reasons such as culture and collaboration for demanding in-office attendance, there’s no evidence for them. Until this ‘why’ gets answered convincingly by employers, the struggle will persist. 

What can we do? 

Help organizations build ways of working that are grounded in listening to what people want, understanding their needs, and co-creating solutions that work for everyone – both employer and employee. This is far more likely to lead to sustainable improvements in performance and EX than draconian diktats and disciplinary action. 

The problems EX fixes are not going away 

It’s undeniable that investment in EX is reducing, and momentum is cooling. However, that is different to EX having run out of steam. It may be progressing at a slower pace than in previous years, but there are many reasons to stay positive about the ongoing relevance of EX.

Number one is that the challenges it helps to address are not going away. In fact, they are becoming more urgent. Recruitment and retention, engagement, productivity, inclusion, wellbeing – you name it, and most companies are struggling with several, if not all, of these issues. In any instance, improvements to EX can help create a more attractive workplace, empower, support, and develop employees, and reduce attrition. 

What can we do? 

Map out your current employee lifecycle, talk to a cross-section of your people to discover their biggest pain points and desires, and design an EX for them that addresses the real moments that matter. You will often find that there is a 20% intervention that can deliver 80% of your benefits, so try to identify what you should over-index on (for example, onboarding is a common complaint) and double down on that. 

Let’s talk about DEX 

Digital employee experience (DEX) is a term used to describe the ways in which employees interact with their organization’s digital environment. This includes the hardware and software they use to work, as well as the degree of access and support they receive. 

Given that much of today’s employee experience is enabled by technology, the importance of DEX cannot be overstated. Indeed, having a strong DEX strategy and plan can save businesses time and money, increase productivity, and aid retention – among many other benefits. Small wonder then that, according to Gartner, “By 2025, 50% of IT organizations will have established a DEX strategy, team, and management tool, up from less than 20% in 2023”. 

What can we do?

Ivanti’s State of Digital Employee Experience study found that half of employees are frustrated by company-provided tech, with just over a quarter considering leaving their jobs because of it. We now have an ideal opportunity to partner closely with the IT function to ensure that we put our people at the center of our organization’s DEX plans and deliver a holistic, seamless, and consistent employee experience. 

The potential of AI 

The inexorable march of artificial intelligence (AI) shows no signs of letting up, with 65% of respondents to this McKinsey survey regularly using generative AI, and three-quarters predicting that it will lead to significant or disruptive change in their industries in the years ahead. The question is, how can AI be used to transform EX?

The answer is – in many ways. Here are just some use cases:

• Streamline workflows – AI can automate receptive and low-value tasks so employees can focus on more creative, meaningful, and fulfilling work.
• Internal communications – forward-thinking organizations are using AI to create content, and help their people navigate company systems and find information quicker and with less friction. 
• Recruitment, onboarding, and training – HR teams are using AI to automate and simplify recruiting, onboarding, and training processes. In doing so, they’re making these EX moments that matter more impactful for employees.

What can we do?

AI is all about balance. While the possibilities are endless, it’s critical to keep people at the heart of your EX. The best employee experiences are human-centered and augmented by technology, not the other way around. 

Far from running out of steam, employee experience has simply hit an early bump in the road. In 2024 and beyond, practitioners will need to weigh up impact vs. investment, get creative, and take advantage of opportunities to align with strategic partners. If we can do that, the future could still be rosy.