SHRM Reports Toxic Workplace Cultures Cost Billions

 

September 25, 2019
NEW YORK — One in five Americans have left a job in the past five years due to bad company culture. The cost of that turnover is an estimated $223 billion, according to a new SHRM report on workplace culture.

“Billions of wasted dollars. Millions of miserable people. It’s not a warzone—it’s the state of the American workplace,” said SHRM president and CEO Johnny C. Taylor, Jr., SHRM-SCP. 

“Toxicity itself isn’t new. But now that we know the high costs and how managers can make workplaces better, there’s no excuse for inaction.”

The report, The High Cost of a Toxic Workplace Culture, surveyed American workers to explore the impact of workplace culture on both the well-being of workers and the bottom line of businesses. It found toxic culture costs companies a fortune in turnover and absenteeism; highlighted common indicators of bad workplace cultures, such as discrimination and harassment; and underscored the alarming impacts on employees. 

The research also uncovered a seemingly critical skills gap at the management level. SHRM found employees hold managers—more than leadership or HR—most responsible for culture. They also say their managers often lack the soft skills needed to effectively listen, communicate, and ultimately lead.

Key Findings

  • Nearly half of employees (49 percent) have thought about leaving their current organization, while nearly one in five have left a job due to culture in the past five years. 
  • Turnover due to culture may have cost organizations as much as $223 billion over the past five years.
  • Seventy-six percent of Americans say their manager sets the culture, yet 36 percent say their manager doesn’t know how to lead a team. 
  • Twenty-six percent say they dread going into work.

In addition to this workplace culture report, SHRM also released its 2019 Workplace Fulfillment Index, which revealed 44 percent of Americans feel extremely or very fulfilled in their current job compared to 56 percent who feel less than fulfilled at work. It also explored which factors contributed most to fulfillment, and found workers ranked cultural factors, such as meaningful work and flexibility, as more fulfilling than factors such as commute times or professional development. For more information on SHRM’s 2019 Workplace Fulfillment Index, visit www.talkworkculture.com.

Media: SHRM President and CEO Johnny C. Taylor, Jr. and SHRM Chief Human Resources Officer Sean Sullivan are available for interviews. Contact Cooper Nye of SHRM Media Relations at Cooper.Nye@shrm.org and 248-756-1123 or Rockhelle Johnson at Rockhelle.Johnson@shrm.org and 202-999-9813 to schedule an interview. 

Methodology: The 2019 SHRM Omnibus Survey was conducted from Thursday, July 25th through Tuesday, July 30th, using the AmeriSpeak Panel®, NORC at the University of Chicago’s nationally representative, probability-based panel. Online and telephone interviews using landlines and cell phones were conducted with 1,014 adults. Some questions in the survey were asked to all respondents and others were asked only to a subset of 514 adults who were currently employed and working in an organization.

About SHRM
SHRM, the Society for Human Resource Management, creates better workplaces where employers and employees thrive together. As the voice of all things work, workers and the workplace, SHRM is the foremost expert, convener and thought leader on issues impacting today’s evolving workplaces. With 300,000+ HR and business executive members in 165 countries, SHRM impacts the lives of more than 115 million workers and families globally. Learn more at SHRM.org and on Twitter @SHRM.



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