As small business owners approach the midpoint of 2021, many are still identifying the stressors and successes of 2020 and adjusting their business plans accordingly. Some have responded by acknowledging the need for hiring new employees. According to the Manifest Survey, which surveyed 500 small businesses in the United States, 51% plan to hire new employees in 2021. With this growth, it is important to consider how small businesses can make the best use of these positions and encourage growth and success through their work practices. But how? The founders of the Thrive XM Index noted, “This project began with a shared belief — that when people feel supported, the companies they work for are more agile, more resilient, and better positioned to succeed.” While this was a privately held belief, and certainly a part of their professional experience, they could not find the data to back it up. Consequently, the Thrive XM Index was born.
This study included results collected between August and November of 2019, spanning over 20,000 employees and 900 companies across the United States. The score was broken down into three components: moments (a rating given by the employee on how their employer impacted up to 45 life moments), experiences (a holistic rating given by employees on employer impact in the areas of friends and family, career, health, finances, and time), and wellbeing (employee rating on the impact their employer has had on body, mind, connections, resources, and motivation). These three facets each are equal parts of the overall Thrive XM Index score, successfully connecting intangible experiences to quantifiable outcomes. Finding where individual companies landed on the Thrive XM Index allowed them to identify trends on both employee and organizational outcomes. These findings were matched with organizational benchmarks in 2019 to 2020, revealing some significant results.
The Thrive XM Index helped determine four main impactful experiences that largely correlate with employee welfare (performance reviews, managing mental wellbeing, learning new skills, and handling workplace conflict). Those who had positive experiences in these areas were deeply influenced by them and responded with up 28-35% lifts in engagement and 28-35% increase in work life satisfaction. Notably, those who had positive experiences with employers helping them with their mental wellbeing found 37% reduction of stress, 28% increase in engagement, and 25% lift in advocacy. These are just a few of the findings that show employer engagement has significant impact on employee wellbeing.
This study not only summarized how employer actions impact employee welfare, but also connected employee welfare with business success markers. Companies that were in the top 25% of the Thrive XM Index averaged 16.4% growth in revenue from 2019-2020. Additionally, of the companies that were studied, there was a noted increase in employee revenue per increased percentage point on the Index ($53 dollars per employee). Of the top 10% of studies companies, the company improved an average of 11 spots in the Fortune 500 between 2019 to 2020. These findings reiterate that employee wellbeing does have a significant connection to business wellbeing.
This study also shed some light on the impact the pandemic has had on employee welfare in relationship to business outcome. From March 1 through July 1, the Thrive XM Index continued to show a correlation between personal and professional success for companies that scored in the top 10%. These companies averaged total returns of 19.9%, compared to the S&P 500 benchmark of around 10%. Additionally, these same companies outperformed their competitors in their industry at an average return of 5.7%. These changes mark a significant improvement upon the overall success of their business and prove that employees who found stability in the workplace during COVID-19 gained greater returns for their employer.
These findings are only as helpful as the actions that follow, and we have a few ideas on how you can pursue this kind of success in your own small business.
1). Get a benchmark of your employee’s wellbeing. While you may not be able to score your small businesses rating on the Thrive XM Index, you can get a broad understanding of where your employees are feeling most and least confident. What areas of stress do you see impacting your employees? Take some time to informally assess their experience and ask them for feedback on what areas of your business management they feel can be improved.
2) With those findings in mind, make a few tangible goals in response. For example, if you are finding that employees are reluctant to request days off or sick leave, begin brainstorming new communication strategies that improve clarity and remove undue stress. Creating actionable steps will allow you to address their feedback and prove your willingness to grow as an employer.
3) Set a timeline and implement these initiatives. The kind of growth it takes to see employee retention, behavior, and engagement improve will not happen overnight, but tracking the tangible ways you are addressing these issues will allow you to look back later and see progress. Acknowledging that employee welfare is not only an ethical issue but a financial one will ultimately promote progress in the workplace and make a healthy and profitable environment as your business grows.
For more information on how to increase employee wellbeing, or ideas on how you can improve as a leader for your employees, contact us today!
Learn more about the Thrive XM Index by visiting https://thriveglobal.com/stories/thrive-xm-index/