Employee engagement is one of the most extensively researched constructs in organizational management. It encompasses employees’ emotional, cognitive, and behavioral connection to their work and organization (Kossyva et al., 2023).
It is also one of the most tracked organizational metrics. The State of the Workplace Study (HR Research Institute, 2025) found that two-thirds of surveyed organizations measure engagement regularly. While these assessments are often conducted annually, leadership transitions, organizational restructuring, and other significant disruptions can trigger more frequent surveys. CEOs and Chief Human Resources Officers (CHROs) often treat the results as a report card on their leadership and people practices. At a global level, Gallup’s annual engagement research has been providing an important benchmark for understanding engagement trends across organizations and economies, since 2009.
Yet, despite the attention it receives, a fundamental question remains: Are we measuring the right kind of engagement?
Understanding Employee Engagement
Kahn (1990) first conceptualized employee engagement as the expression of an individual’s cognitive, emotional, and physical self in work-role performance. According to Kahn, the degree of employee engagement depends on three psychological conditions: meaningfulness (feeling that one’s work is valuable), safety (feeling able to express oneself without fear of negative consequences), and availability (having the physical, emotional, and psychological resources to engage). Engaged employees bring their full selves to their roles, expressing their potential through their work (Kahn & Fellows, 2013).
Subsequent research has explored how workplace conditions influence engagement and burnout. Maslach (2003) identified six important factors: workload, control, rewards and recognition, community, fairness, and values. Building on this work, the Job Demands–Resources (JD-R) model distinguishes between job demands, which require sustained effort and may contribute to exhaustion, and job resources, which help employees achieve goals, manage demands, and grow (Bakker et al., 2007).
The model describes two parallel processes: one associated with motivation and engagement, and the other with exhaustion and burnout. Engagement, reflected in vigor, dedication, and absorption, can fluctuate as demands and resources change (Bakker, 2022). Employee engagement surveys are intended to help organizations understand these workplace conditions and identify opportunities for improvement.
The Economics of Engagement
Engagement is associated with organizational performance and shareholder value (Bakker, 2008; Gupta & Sharma, 2016; Khan et al., 2025). Research also links it to learning, adaptability, and organizational citizenship behaviors (Bailey et al., 2017; Saks, 2019; Turner, 2019; Lee & Jo, 2023)—all important contributors to organizational effectiveness.
The economic implications are substantial. Gallup estimates that low employee engagement cost the global economy approximately $10 trillion in lost productivity in 2025, equivalent to 9% of global GDP.
Therefore, organizations have consequently invested in understanding and measuring engagement. Fortune Business Insights (2026) valued the global employee engagement software market at $1.22 billion in 2025, and projects quadruple growth by 2034. While this represents only the spending on software rather than the full cost of engagement programs, it illustrates the scale of investment in measuring and managing the employee experience.
But individual engagement tells only part of the story. The dominant focus on individual employees may leave an important dimension of organizational effectiveness overlooked: team engagement.
The Missing Metric: Team Engagement
Organizations rarely achieve results through individuals working in isolation. In service-based and knowledge-intensive environments, performance depends on collaboration, coordination, and interdependent work. An employee can feel engaged with their job and organization without necessarily experiencing strong engagement with their team.
Torrente et al. (2012) conceptualized team engagement as a shared, positive work-related psychological state characterized by vigor, dedication, and absorption, emerging from team members’ interactions and shared experiences. Unlike individual engagement, which reflects an employee’s relationship with their work, team engagement captures the collective energy and involvement that develop when people work together.
This distinction is reflected in how engagement is measured. Individual engagement surveys assess experiences such as role clarity, access to resources, recognition, and development. Gallup’s employee engagement questionnaire, for example, includes statements such as “I know what is expected of me at work” and “There is someone at work who encourages my development” (Gallup, 2024).
Team engagement, by contrast, concerns the collective experience of working together: whether the team feels energized, deeply involved in its work, and connected through shared goals. Measures developed by Costa et al. (2015) include statements such as “At work my team is bursting with energy” and “My team feels happy when we are working intensely.”
Both perspectives matter, but they capture different aspects of the workplace. Understanding one does not automatically reveal the other.
Why Team Engagement Matters Now
The distinction is particularly relevant as teamwork undergoes two significant transformations in this decade: the shift toward virtual and hybrid work, and the emergence of human–AI teams (HATs).
First, the shift from co-located to virtual and hybrid teams. Individual employee engagement seems to have a positive relationship with remote working (Fatima et al., 2024). Gallup’s State of the Global Workplace Report (2025) also found differences in engagement across work arrangements, with remote employees reporting higher engagement than on-site employees. However, the effect of remote working on team engagement is not necessarily the same. Research examining 90 global business teams (976 individuals) found a negative relationship between team virtuality and team engagement (Gururaj, 2024).
These findings are not necessarily contradictory: they examine different phenomena. Remote work can improve individual experiences through flexibility, autonomy, and greater control over working conditions. Yet these benefits do not automatically translate into stronger team engagement. Spontaneous conversations, shared experiences, and informal interactions that build collective energy can be harder to sustain in virtual environments (Baker et al., 2024; Coulston et al., 2025). Research suggests that behaviors that enhance team mood, generate energy, and foster unity, contribute to team engagement (Fortuin et al., 2023). Such behaviors require deliberate effort in any setting and may be more difficult to cultivate when interactions are primarily virtual.
Second, the emergence of human–AI teams (HATs). Organizations are increasingly integrating artificial intelligence (AI) into collaborative work and complex decision-making (Bankins et al., 2024). AI can reduce repetitive tasks, improve individual productivity, and free employees to focus on more meaningful work. However, these benefits do not necessarily translate into stronger team engagement.
Emerging research raises questions about how AI-mediated work affects human collaboration (Reitz & Higgins, 2024; Dyreng, 2026; Hoffman et al., 2026). The developing literature on HATs presents mixed findings on the effects of AI teammates on team processes and outcomes (Zercher et al., 2023; Ulfert et al., 2024). Some research suggests that communication and coordination are less effective in HATs than in human-only teams (Zercher et al., 2025), while findings on team cognition and trust remain mixed (Schmutz et al., 2024; Zercher et al., 2023).
The shift is already a strategic priority. Nearly half of global business leaders surveyed in Microsoft's 2025 Work Trend Index identified expanding team capacity with AI team-mates as a priority for the following 12–18 months. As organizations integrate AI into teamwork, leaders will need to pay closer attention to the quality of human interaction and the shared experiences that sustain teams. Conventional employee surveys alone may fail to reveal emerging challenges in collaboration, communication, cohesion, and collective motivation.
It is vital to complement employee engagement surveys with team engagement measures.
Teams are fundamental units through which organizations translate individual effort into collective results. To understand not only how employees feel about their jobs but also how effectively they work together in an increasingly virtual and AI-enabled workplace, organizations need a broader view of engagement.
Doing so would help leaders identify barriers to collaboration, understand the collective experience of work, and create opportunities to strengthen the shared energy on which team and organizational performance depend.
References:
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