HR 101: How to Measure Employee Engagement in 2025

Measuring employee performance as part of a larger performance management strategy is undeniably important, but if that’s the only thing you’re measuring, you’re not getting the complete picture.

To get an accurate and holistic view of how your employees are doing on the job, you have to measure employee engagement too.

Unlike performance which measures output, employee engagement strategies attempt to measure the mental and emotional connection employees have towards the people they work with, the work they do, and the organization as a whole.

That can sound like an almost impossible thing to measure. Exactly how can we measure employee engagement, and how do we know what the data means?

Here are the answers to some common employee engagement questions along with survey tips, assessment insights, and more that will make sure you get the most out of your employee engagement strategy.

Related: How to Improve Employee Satisfaction - 15 Examples

How Is Employee Engagement Assessed?

No matter what vertical you're in, whether it's healthcare employee engagement or any other industry, a survey is a great place to begin. That’s especially true if you use employee engagement software.

An anonymous engagement survey enables you to ask important questions while encouraging your employees to answer honestly. They don't have to be long or time-consuming, either. You can send out pulse surveys that only take a minute or two to complete, which means you can send them out more frequently throughout the year.

One of the biggest benefits of using the best employee survey software is that the data collected is automatically collated. You can display the results in many different ways without having to manually input or manipulate the data.

Surveys are the most intuitive way to gather employee engagement data, but there are also other ways to measure employee engagement without surveys.

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Other methods include:

• Analyzing customer satisfaction
• Calculating the employee retention rate
• Look into the employee absenteeism rate
• Conduct employee exit interviews

The frequency at which you measure employee engagement will depend on the particular goals of your organization. We recommend sending out an employee engagement survey at least once a year with smaller pulse surveys in between to gauge changes in engagement over time.

Continuous feedback software can be hugely helpful in tracking engagement in real-time. Software that supports one-on-one meetings and check-ins allows you to both formally and informally assess employee engagement all year long. Culture assessment tools are also useful in this area.

How Is Employee Engagement Calculated?

Calculating engagement seems like an impossible thing to measure. The trick is to divide your employee engagement metrics into quantitative and qualitative data.

Quantitative data is the easiest to collect because it uses numbers and figures. The eNPS (Employee Net Promoter Score) is a great example of quantitative data that you can collect.

The NPS is designed to determine how satisfied employees are based on whether they would recommend their workplace to others as a great place to work. It is broken down into a scale from 0-10. You can measure exactly how many employees actively promote the company (scores of 9-10), how many are passive about their recommendation (scores of 7-8), and those who would detract others from working at the company (scores of 0-6).

Creating an employee engagement measurement scale for qualitative metrics can be a bit more challenging, but it's just as important.

Qualitative data can help you understand the why behind low employee engagement scores. An easy way to collect qualitative data is to ask questions with open-ended answers. It allows employees to share information that is important to them, and it can highlight the reason for particularly low or high scores.

For example, you might ask employees to first rate their stress levels at work. Then, include the opportunity for employees to provide an open ended response so they can answer why they feel stressed. You might discover commonalities between employees with high self-reported stress levels, as well as commonalities between employees who report low-stress levels. You can then act on those findings to make work less stressful for everyone.

» Employee Engagement ROI Calculator

How Is Employee Engagement KPI Measured?

KPIs are an effective way to measure performance, but they are also among the most effective employee engagement metrics.

Short for key performance indicators, KPIs are quantifiable things you can measure against a set of objectives. For example, an employee who has an explicit performance goal might have two or three KPIs that demonstrate whether or not they have met their goal.

Creating KPIs as an employee engagement tool means finding things to measure that indicate engagement. For example, measuring survey participation can be a good way to gain insights into engagement, regardless of the responses, as it shows employees are engaged enough to provide their feedback. You can also compare the number of successful hires to unsuccessful hires, and you can track internal promotion rates to see who has been successful in their previous and current roles.

By measuring multiple KPIs, you can create a big-picture view of where employees are the most engaged and where your organization is falling short.

Using HR analytics software can make it easier to measure and compare custom KPIs. Data points are automatically stored during the review process so you can track engagement over time, turn data into visual insights, and compare engagement data with other data, like performance, to get a more complete picture of how engagement is impacting your organization.

» How to Change Company Culture: A Step-by-Step Guide

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Best Practices When Measuring Employee Engagement

An annual survey is a popular employee engagement best practice and a great way to gather in-depth data from your employees, but employee engagement measurement tools also need to be used throughout the year to get a true grasp of how engaged your employees are.

For example, goal check-in software supports the practice of having managers meet with their employees for just a few minutes multiple times throughout the year. This gives employees a chance to bring up potential problems that could impact their engagement, and managers can help keep employees on track to meet their goals.

Using a software platform also enables you to be at the forefront of performance management innovations. As they evolve, AI-powered tools will be able to supercharge data analysis and provide predictive analytics that will help you identify engagement trends at your organization.

If you’re looking for performance review software that makes it easy to measure employee engagement, look no further than PerformYard. Our employee engagement software was specially designed to be customizable so you can gather important performance and engagement data that is specific to your organization.