The workplace is undergoing a significant transformation that is affecting how employees feel about their jobs and their futures. New research released this week shows that global employee engagement has dropped to 20%, which is the lowest level since 2020. This means that most workers around the world are not feeling connected to their jobs or motivated by their work. When engagement was highest back in 2022-2023, it reached 23%, so there has been a steady decline over the past few years. Each percentage point that engagement drops means approximately 21 million fewer engaged employees around the world, which is a massive number of workers who are feeling detached from their companies.

One of the most surprising findings is that manager engagement is falling faster than regular employee engagement. Historically, managers have always been more engaged with their work than the people they supervise. But this year, that pattern is changing. Since 2022, manager engagement has dropped by nine percentage points, going from 31% down to 22% in 2025. In some regions like South Asia, the drop has been even more dramatic, with manager engagement falling by eight points in just one year. This suggests that managing people has become increasingly difficult and demanding, and managers are struggling to keep up with the pressures of their roles.

The reason manager engagement is falling so fast may be related to how companies are restructuring themselves. Many organizations are becoming flatter, which means they are eliminating management positions and having fewer layers of leadership. When this happens, the managers who remain have to oversee more people and handle more responsibilities without getting extra support or resources. Additionally, the pace of change in the workplace is accelerating, with artificial intelligence and digital transformation happening rapidly, which is adding to the stress and workload of managers. The report suggests that companies that maintain strong manager engagement can achieve levels as high as 79%, which shows that it is possible to have highly engaged managers if organizations focus on supporting them properly.

Beyond engagement issues, employees are increasingly worried about how artificial intelligence will affect their jobs. In the United States, 18% of workers say it is somewhat or very likely that AI will eliminate their job within the next five years. This concern is even higher in certain industries. For example, in finance, insurance, and technology sectors, nearly one-third of workers believe their jobs are at risk from AI and automation. In the first quarter of 2026, surveys found that this fear is growing, with more workers expressing concern about job security than in previous years. The worry about AI job loss is becoming one of the top concerns affecting workers' mental health and overall well-being.

The impact of this uncertainty on younger workers is particularly severe. Generation Z and Millennials are reporting the highest levels of stress, anxiety, and burnout in the workplace. These younger workers are dealing with both workplace stress and financial anxiety, as rising costs and economic uncertainty make it hard to achieve goals like buying homes or starting families. About 60% of Generation Z employees and 55% of Millennials are planning to switch jobs within the next year, with workplace stress being a key reason they want to leave. It is concerning that despite seeking mental health care more than any other generation, young workers are still struggling significantly. This suggests that the workplace challenges they face are beyond what mental health services alone can solve.

Stress in the workplace is reaching crisis levels across the globe. According to recent reports, nearly 90% of employees experienced at least one mental health challenge in the last year, and about half of all workers report experiencing high stress levels every single day. In the United States specifically, 44% of employees say they feel overwhelmed by excessive workloads, and 41% point to inadequate staffing as damaging their mental health. About one-third of workers feel undervalued and don't receive enough recognition for their efforts, which adds to their stress. Economic pressures are making things worse, as 63% of American workers say that economic uncertainty is negatively affecting their well-being.

The good news is that the job market remains relatively stable in most parts of the world. About 52% of employees believe it is a good time to find a job, which is slightly up from the year before. However, there are important regional differences. In the United States and Canada, job market confidence has dropped significantly by 10 points, and the region now ranks among the least optimistic places globally. Australia and New Zealand experienced an even steeper decline of 12 points, though these regions still remain above the global average. These declines may be related to changes in employer policies regarding remote work and concerns about automation.

One final concern is that artificial intelligence has not yet delivered the productivity improvements that many companies hoped for. Despite billions of dollars being spent on AI technology, only 12% of workers believe that AI has meaningfully changed how their work gets done. This mismatch between technology investment and actual workplace impact suggests that companies need to focus more on supporting their employees and managers through technological change, rather than simply implementing new technologies. Experts recommend that organizations adopt more empathetic approaches to managing change and help workers develop the ability to adapt, learn, and experiment with new tools and methods in their daily work. By 2027, 46% of global employers are expected to make employee well-being a foundational part of their human capital strategy.