WorkL, a global leader in employee engagement, has released its Exploring Workplace Happiness in 2025 Mid-Year Report, offering a comprehensive snapshot of employee engagement trends across industries and territories at a time of accelerated AI inclusion within the workplace and growing political and economic changes worldwide.
The report draws on global employee data which outlines what is truly driving happiness and retention at work, also highlighting the growing concern among UK employers about rising National Insurance Contributions (NICs), with client survey data from WorkL suggesting a reluctance to fill vacancies under the current budget pressures.
Flexibility continues to be the big driver for employee happiness in the workplace. Hybrid work and working from home is not going anywhere, despite a number of big organisations requesting employees back to the office five days a week.
Key Findings Include:
- Technology leads the way– The Technology sector tops the global and UK engagement rankings, scoring 80% and 84% respectively, with high confidence in leadership setting it apart from other industries.
- Flexibility fuels engagement– Remote and hybrid work continue to be closely tied to employee satisfaction, particularly in regions such as South Africa and the USA, where flexibility correlates strongly with higher engagement scores.
- Pay remains a top concern– In a global climate of inflation and rising living costs, compensation and financial benefits emerged as the most frequently cited area for improvement, highlighted by over 10,000 survey respondents.
- Regional and sector disparities– UK sectors like Retail and Hospitality continue to underperform compared to global counterparts, hindered by local economic pressures and regulatory changes. Young and non-management staff in these sectors face particularly low satisfaction levels.
- Frontline and disabled employees at risk– Disabled employees in the UK report below-benchmark confidence in management and a heightened risk of leaving. Frontline workers across industries also show reduced trust in leadership, contributing to elevated turnover.
Commenting on the report, Lord Mark Price, left, Founder of WorkL, said: “For the first time, WorkL is releasing a Mid-Year Report – a check-in on workplace happiness halfway through the year. With the world of work evolving rapidly and the past six months marked by significant economic and political shifts, it feels more relevant than ever to take stock of how employees are really feeling at work.
This year’s data reveals that while industries face vastly different challenges, common threads remain, flexibility, fair pay, and strong leadership are non-negotiable for employee satisfaction. With economic pressures mounting and changes to National Insurance contributions influencing business hiring decisions, employers need to act decisively.”
The Retail sector, one of the UK’s largest private sector employers across both seasonal and permanent positions, faces significant financial pressure following the 2024 Autumn Budget announcement. The UK government’s sweeping changes to employer NICs, which took effect in April have imposed an additional burden exceeding £7 billion on retailers’ operational costs. This substantial increase in mandatory expenditure comes at a challenging time for an industry already navigating thin profit margins, evolving consumer behaviours and digital transformation demands.
Consequently, many retail organisations have been forced to reprioritise their financial allocations, potentially compromising crucial employee engagement initiatives that traditionally support workforce satisfaction, productivity and retention in this high-turnover industry.
Helen Dickinson, left, Chief Executive at the British Retail Consortium, said: “The Retail industry faces significant headwinds, with the last Budget adding over £7bn to their bills in 2025. This will have implications for investment, hiring, and pricing decisions, as retailers adapt their businesses to remain competitive. Retail is the largest private-sector employer, providing flexible and local jobs for millions of people in all corners of the UK. Increases to employer National Insurance will have a disproportionate impact on both retailers and their supply chains, who together employ 5.7m people. Ultimately, it will cost jobs and push up prices for everyone, with food inflation estimated to hit 5% by the end of the year.
“With the industry navigating choppy waters, and operating on wafer-thin margins, leaders need to ensure transparent and honest conversations are ongoing with colleagues about some of the more difficult decisions that may need to be made as well as building consensus and alignment about the opportunities in the future. Decisions by the government impacting retail affect us all: through prices in shops, availability of jobs, or the health of our local high streets. We must ensure they don’t weigh heavy on the morale of the people who keep our industry going day in, day out.”
Reflecting upon the responses to the question, “What three changes would improve your workplace happiness?”, several key themes emerged. The most frequently cited area was Pay and Financial Benefits, with over 10,000 individuals, underscoring the importance of fair and competitive compensation. Working Hours and Flexibility followed, with 5,597 individuals highlighting concerns around work-life balance, time off and flexible schedules. Other prominent topics included Management and Leadership, Communication and Transparency (3,087 individuals) and Progression and Development (2,543 individuals). These findings reinforce that while the core drivers of workplace happiness are well known, they remain urgent and central to employee experience.
WorkL’s mid-year analysis delivers a powerful call to action for employers; understand what drives your workforce, respond to employee needs with empathy and data, and invest in a culture that prioritises engagement. By addressing key pain points, businesses can not only retain top talent but build more resilient, productive workplaces.
Download the Report here.