Happiness at Work in 2025: Insights from Our 3rd Annual Report and Global Trends

Workplace happiness is no longer a “nice-to-have” – it’s a strategic imperative. Research shows that happy employees are not only more pleasant to work with, but significantly more productive and less likely to quit. Gallup estimates that low employee engagement (a proxy for unhappiness at work) costs the global economy a staggering $8.9 trillion in lost productivity. On the flip side, an Oxford University study found that happy workers are 13% more productive than their unhappy peers. In short, fostering employee happiness isn’t just about doing the right thing for people – it’s good for business.

Our organization’s 3rd Report on Happiness at Work sheds new light on what drives employee happiness today. In this blog-style article, we’ll highlight key takeaways from the report and connect them to broader global trends in employee experience and wellbeing. We’ll take a multicultural perspective, recognizing how culture and context influence happiness, and explore what it all means for HR leaders managing teams in a post-pandemic, hybrid work era. The goal is to give you an insightful, data-driven roadmap to boost satisfaction, belonging, and performance in your organization.

Key Findings from the 3rd “Happiness at Work” Report

Our latest Happiness at Work report (third in the series) gathered extensive data on how employees feel about their jobs across various regions and industries. Several compelling findings emerged:

• Most employees report being happy: Globally, 70% of employees say they are happy at work, including about one in four who identify as “very happy”
• Regional differences exist: Happiness levels vary by country and culture. For example, in Spain about 61.4% of employees report being happy – a solid figure but below the global average
• Autonomy and flexibility boost happiness: Our report found that independent workers (freelancers, contractors) reported higher happiness levels (about 69.7% happy) compared to salaried employees (60.1%)
• The manager effect is real: Perhaps the most striking insight is the pivotal role of leadership. Employees with empathetic, supportive managers reported significantly higher levels of satisfaction, engagement, and motivation than those with less effective managers
• What makes a great manager? The report highlights key traits of high-impact managers: empathy (genuinely understanding employees’ challenges), recognition (acknowledging good work), growth-oriented leadership (providing learning and development opportunities), and clear, open communication
• Employee voice and belonging: Another theme is the importance of employees feeling heard, included, and connected at work. When employees feel their opinions count and they belong, they are far more likely to be happy and engaged. Our initiative to invite public participation in the survey (part of the 3rd Global Workplace Happiness Report launch) underlines this – giving employees a voice helps shape a happier workplace

Those are a few highlights from our report. How do they compare with the broader landscape of workplace happiness and well-being worldwide? As it turns out, global research both reinforces and contextualizes our findings – painting a nuanced picture of progress and challenges.

The Global State of Workplace Happiness and Well-Being

Zooming out, what does overall employee happiness look like around the world today? Mixed signals emerge from recent studies:

• Engagement is low worldwide: Despite many employees telling us they feel “happy” in general, global engagement levels remain strikingly low. Only about 21–23% of employees worldwide are engaged at work, according to Gallup’s latest data
• Well-being saw gains, then stagnation: In the early 2020s, there were small improvements in global workplace engagement and well-being, but 2023 data showed a plateau. Gallup’s State of the Global Workplace 2024 report states that employee engagement stagnated in 2023 and overall well-being actually declined, after several years of gains
• Stress remains high: On that note, workplace stress is alarmingly prevalent. Gallup found that 41% of employees experienced a lot of stress “yesterday” (i.e. daily stress), which is actually an improvement from the record-high 44% in 2022
• Many are job-hunting: Another barometer of dissatisfaction is the percentage of workers open to new jobs. More than half the world’s employees (52%) are watching for or actively seeking a new job
• Post-pandemic paradox – happiness down in 2023: You might expect that as the pandemic receded, employee happiness would rebound. Instead, some measures show it dropped. For instance, a BambooHR analysis revealed that in late 2023, employee satisfaction in the U.S. hit a four-year low
• Key drivers of discontent: What’s behind disengagement and unhappiness? Several global surveys point to common pain points. A Qualtrics 2024 Employee Experience Trends study (as cited by BambooHR) found that many workers feel unappreciated due to “gaps in recognition, low satisfaction with financial rewards, and a lack of growth and development opportunities” at work

Despite these challenges, there are also bright spots and important global trends that bode well for workplace happiness. For example, flexible work arrangements have gained traction, and studies indicate they often improve employee well-being. There’s also a growing emphasis on diversity, equity, and inclusion (DEI) and belonging in many organizations, which can boost happiness when done right. Let’s delve into two particularly important trends in more detail: the impact of hybrid work, and the influence of culture (both organizational culture and national culture) on happiness.

The Hybrid Work Era: Flexibility vs. Connection

The post-pandemic world has ushered in hybrid and remote work at an unprecedented scale, and its effect on employee happiness is significant. Our report’s finding that independent (more flexible) workers are happier aligns with what larger studies are finding about hybrid work models:

• Flexibility boosts happiness: A global study by Cisco of 28,000 employees across 27 countries found 82% of employees say the ability to work from anywhere has made them happier
• Well-being and work-life balance improved: The same Cisco research noted that hybrid work has improved overall well-being and work-life balance for a majority of employees
• Challenges of hybrid – connection and culture: However, hybrid is not a panacea. Companies are still figuring out how to maintain culture, collaboration, and inclusivity in a dispersed workforce. Tellingly, Cisco found that only 1 in 4 employees feel their organization is “very prepared” for hybrid work long-term
• The RTO debate and the path forward: 2023 saw heated debates about Return to Office (RTO) mandates, with some executives eager to bring people back in-person and many employees resisting after tasting remote freedom. As we enter 2024 and beyond, progressive HR thinking has shifted from where work happens to how work gets done

Speaking of belonging, that’s a perfect segue into the next critical topic: cultural and human factors that influence happiness at work, including diversity and cross-cultural differences.

Culture, Diversity, and Happiness: One Size Does Not Fit All

Workplace happiness is profoundly influenced by culture – both the internal culture of an organization and the broader cultural context in which employees live. For multinational companies or diverse teams, a multicultural perspective is essential. What motivates and satisfies employees can vary across countries, generations, and individual backgrounds. Here are some insights:

• National cultural differences: Numerous studies in positive psychology show that cultural values shape how people experience and even define happiness. For instance, Western cultures (e.g. US, Europe) tend to prize excitement, positivity, and personal achievement, and indeed Western countries report higher self-assessed happiness on average
• Individualism vs. collectivism: On a related note, research suggests that happiness levels tend to be higher in more individualistic societies and lower in more collectivist ones
• Generational differences: Culture isn’t just national – workplace generations have their own “culture” and expectations. Our report and other research highlight that younger employees (Gen Z and Millennials) have different workplace priorities than older generations. Notably, evidence from the World Happiness Report analysis shows young people in many developed countries are significantly less happy than older people today
• Inclusion and belonging: One universal factor that transcends demographic differences is the human need for belonging. Regardless of age or nationality, people want to feel accepted and valued by their colleagues and organization. A strong sense of belonging at work has powerful effects: studies show high belonging is linked to a 56% increase in job performance and a 50% reduction in turnover risk
• Global happiness rankings context: It’s interesting to note that the countries which top the World Happiness Report (an annual ranking of general life satisfaction by country) are consistently the Nordic nations

In sum, culture and context matter greatly. A savvy HR leader will approach employee happiness not as a monolithic goal, but as a locally informed, diverse, and inclusive effort. The next question is: given all these insights, what can organizations actually do to boost happiness at work?

Building a Happier Workplace: Strategies and Implications for HR Leaders

Creating a genuinely happy and engaged workforce requires intentional action on multiple fronts. Here are key strategies – informed by both our report’s findings and the global trends discussed – that organizations can use to boost employee satisfaction, belonging, and performance:

1. Invest in Great Managers and Leaders: Since managers have an outsized impact on happiness, leadership development is one of the highest ROI investments you can make. Train managers in the skills highlighted in our report – empathy, active listening, coaching, recognition, and clear communication. Encourage managers to have frequent one-on-ones focused not just on tasks but on checking in with employees’ well-being and growth aspirations. Hold managers accountable not only for performance metrics but also for team engagement scores. Many companies now use 360-degree feedback or engagement survey results as part of manager evaluations.

The message should be: every manager is a Chief Well-Being and Happiness Officer for their team. Senior leaders also set the tone; authentic, compassionate leadership from the top (for example, openly discussing mental health or modeling work-life balance) can trickle down and create a safer, happier environment. Effective leadership can transform a workplace – as our report showed, supportive managers unlock significantly higher employee motivation and retention. Conversely, tolerating toxic or inept managers will quickly erode any other efforts. HR can provide tools (training, mentorship, resources like an employee recognition budget) to help good managers become great.

2. Enhance Employee Recognition and Appreciation: Feeling valued is a universal happiness driver. Ensure that employees at all levels get frequent recognition for their contributions – both big and small. This can be formal (awards, bonus incentives tied to great performance) and, perhaps more importantly, informal (a culture of saying “thank you” and celebrating wins). Our data and the Qualtrics study indicate lack of recognition is a common gap.

Close it by empowering everyone – not just managers – to show appreciation. Peer recognition programs, shout-outs in company meetings, and thank-you notes from executives for a job well done all help. Importantly, tailor recognition to the individual’s preferences (some may love public praise; others might prefer a private note or a day off). By making appreciation part of daily life, you boost morale and reinforce positive behaviors. People who feel appreciated typically report higher job satisfaction and loyalty.

3. Provide Growth and Development Opportunities: Stagnation is the enemy of happiness, especially for high performers and younger employees. A robust focus on career development can significantly raise engagement. This means offering training programs, clear paths for promotion or skill advancement, mentorship matching, and new challenges or projects to keep work interesting. Our report noted that growth-oriented leadership is a trait of great managers– employees should regularly discuss their career goals and next steps with their managers. Even if promotions are limited, employees can be given stretch assignments, rotations, or support in learning new skills. Seeing a future within the organization is key to retaining talent; if people feel they’re growing, they are far more likely to be happy where they are.

On the flip side, if they feel stuck, their happiness will plummet (and they’ll likely be among that 52% looking elsewhere). Make development part of the employee experience from day one. It’s worth noting this also ties into inclusion – ensure these opportunities are equitable and accessible to underrepresented groups, so everyone feels they can advance (linking back to belonging).

4. Embrace Flexibility and Work-Life Balance: The pandemic proved that knowledge workers can be productive virtually, and employees have made it clear that flexibility is a non-negotiable expectation now. Companies that insist on rigid 5-days-in-office schedules without a compelling reason risk alienating talent. Embracing hybrid or remote options (where the role allows) will generally increase employee happiness – as the 82% Cisco statistic dramatically illustrates. However, simply offering remote work is not enough; you should also foster a culture that respects work-life boundaries. Encourage employees to take breaks, use their vacation time, and model work-life balance from leadership (e.g., discourage sending emails at midnight, or implement “no-meeting” blocks).

Some innovative companies have tried approaches like 4-day work weeks or meeting-free Fridays to reduce burnout. Whether or not those specific practices suit your organization, the principle is to actively prevent chronic overwork and burnout. When employees have time for their families, hobbies, rest and recuperation, they will be happier and more productive during work hours. Flexibility also means trusting employees – focusing on results rather than micromanaging schedules. This trust in itself boosts morale, because employees feel respected as responsible adults. Remember to support remote employees with the right tools and inclusive practices (as discussed earlier) so they remain connected to the team. In a hybrid era, flexibility should not come at the cost of belonging – you need to work on both.

5. Strengthen Belonging and Inclusion: Fostering a sense of community and inclusion at work might be the ultimate happiness booster. As covered, high belonging yields big performance gains and reduces turnover risk. To build belonging, work on inclusion at every level: ensure hiring and promotions are fair, diversify leadership, and support Employee Resource Groups (ERGs) or affinity networks so people can connect with colleagues of similar backgrounds. Also, invest in team-building and social connection – even in hybrid settings, budget for occasional in-person offsites or virtual team fun events to bond people. Psychological safety is crucial: create an environment where all employees feel they can speak up, be heard, and be their authentic selves without fear. This may involve training managers on inclusive leadership and addressing any hint of toxic behavior (bullying, discrimination) swiftly.

Solicit feedback from employees about whether they feel a sense of belonging – pulse surveys specifically on inclusion can be enlightening. One stat to remember: a Harvard Business Review study noted that high belonging was linked to a 75% reduction in sick days (people even physically feel better when they belong) and massive boosts to engagement and retention. In practice, belonging can be nurtured by small actions like celebrating diverse holidays, encouraging buddy systems or mentorship (so everyone has a friend/mentor at work), and leaders sharing their own stories to connect on a human level. In 2024, experts have identified belonging as a top strategic focus, even more than the remote vs. office debate – because no matter where people work, they need to feel connected to others and to a purpose.

6. Listen and Act on Employee Feedback: Finally, one of the simplest ways to improve happiness is to ask employees what matters to them – and respond. Use tools like engagement surveys, happiness indexes (like eNPS), town halls, and suggestion boxes to gauge sentiment. Our Happiness at Work report itself is an example of gathering feedback at scale. But the real impact comes from acting on the insights. If surveys show, for instance, that employees in a certain region are less happy due to workload, dig in and then implement changes (hire staff, adjust goals, etc.). When employees see that leadership takes their feedback seriously, trust and happiness increase. It creates a positive cycle: people speak up, improvements are made, which makes them more likely to speak up in the future. Also, consider personalizing feedback channels to different cultures – e.g., in some cultures employees may not give direct negative feedback in a group setting, so anonymous surveys or one-on-one meetings might be better. Make feedback regular, not just an annual event. Many companies now do quarterly pulses on key questions. In short, treat employees as stakeholders whose voices drive decision-making. This inclusion in shaping the workplace can itself boost happiness (people feel empowered) and ensures you target your efforts where they are truly needed.

7. Align Work with Purpose: An emerging factor in employee happiness is the extent to which people find meaning and purpose in their work. Especially for Millennials and Gen Z, working for an organization that aligns with their values or contributes positively to society can be a big motivator. The Edelman Trust Barometer finds that younger people look to businesses to lead on societal issues. Companies can tap into this by clarifying their mission and connecting each employee’s role to the bigger picture. Remind employees how their work makes a difference – whether it’s helping customers, supporting a community, or advancing innovation. Encourage things like volunteering days or company-supported social causes (if aligned with your business) to bolster pride and purpose. When employees feel their job has meaning beyond just a paycheck, it’s a powerful source of engagement and happiness. Purpose doesn’t have to mean curing cancer; it can be as simple as an HVAC company saying “we make people’s homes comfortable and safe” and celebrating stories of that impact. The key is to avoid employees feeling like they’re grinding away for nothing – show them the impact and value of their contributions.

By implementing these strategies – better leadership, recognition, growth, flexibility, inclusion, listening, and purpose – organizations create an ecosystem where happiness can thrive. Of course, improvements won’t happen overnight or by accident; it takes sustained commitment from HR and leadership. But the payoff is worth it: not only a more cheerful workforce, but tangible boosts in productivity, innovation, and retention. In an era where talent is scarce and employee expectations are higher than ever, focusing on happiness is a smart competitive move.

Conclusion: The Future of Work is Happiness

The data is clear: happiness at work is far more than a feel-good slogan – it’s tied to outcomes that every organization cares about. Our 3rd Report on Happiness at Work provides cause for optimism, showing that a strong majority of employees can be happy on the job, and identifying the levers (like supportive managers and flexible work) that make a real difference. At the same time, global trends remind us not to be complacent. High stress levels, declining satisfaction in recent years, and variations across cultures and generations mean there is no one-size-fits-all solution. HR professionals and leaders must navigate these complexities with empathy and data-driven insight.

The post-pandemic, hybrid work era presents both challenges and incredible opportunities. Employees have tasted autonomy and will expect it going forward – which, if managed well, can lead to happier, more empowered teams than ever. But organizations must address the new issues that arise (like maintaining connection across distributed teams). They must also double down on age-old human needs: respect, appreciation, growth, and belonging.

In practical terms, building a happy workplace in 2025 means creating an employee experience where people feel cared for as whole humans. It means a workplace where mental health is supported, differences are celebrated, and everyone from the newest intern to the CEO feels that their work has meaning and their voice matters. It’s a tall order, but the research and examples highlighted here offer a roadmap. Companies pioneering these practices (some even appointing dedicated well-being officersto drive the agenda) are seeing results in engagement and retention.

For HR leaders, the mandate is clear: prioritize employee happiness and well-being as a core business strategy. Use the data – both from our report and the likes of Gallup, World Happiness Report, and others – to pinpoint areas to improve. Experiment with new initiatives (whether it’s a mentorship program to boost growth, or a “thank you” campaign to spark more recognition) and measure the impact. Cultivate a leadership culture that genuinely values people, not just as resources but as the heart of the enterprise.

As we move forward, the organizations that thrive will be those that understand happy employees drive happy customers, innovation, and sustainable success. By focusing on happiness at work, we not only improve lives but also unlock the full potential of our teams. That is the ultimate win-win scenario – and it’s within reach if we heed the insights and continue to learn from both research and our own people.

References:

• World Happiness Foundation & Happyforce, “Unlocking Workplace Happiness: Insights from Our Latest Report,” El Confidencial feature (Luis Miguel Gallardo, Jan 19, 2025)
• Gallup, State of the Global Workplace 2024 – Global engagement and well-being trends
• Oxford University (Saïd Business School) study on happiness and productivity (2019)
• BambooHR Employee Happiness Index, Q3 and Q4 2023 analyses – “The Great Gloom” (Kathryn Mayer, SHRM, Feb 27 2024)
• Cisco Global Hybrid Work Study 2022 – impact of hybrid work on happiness and productivity
• Inspiring Workplaces summary of WorkL 2023 Global Workplace Survey (Ruth Holmes, Feb 21 2024) – regional engagement disparities
• Josh Bersin, “What the World Happiness Report Teaches Us About Work” (Mar 2024) – generational happiness gaps and employee expectations
• Harvard Business Review, “The Value of Belonging at Work” (Dec 2019) – effects of high belonging on performance and turnover
• Forbes (Jan Bruce, Feb 2024) via Inspiring Workplaces – importance of belonging as a 2024 strategy
• Greater Good Science Center, “How Cultural Differences Shape Your Happiness” (William Tov interview, May 2019)
• Gallup Workplace Analytics – manager impact on engagement (70% variance)

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