The Correlation Between Happiness at Work and Overall Life Satisfaction

Caring for your employees does not just impact their professional lives and the company’s bottom line. It is impossible to separate one’s professional life from their personal life. If an employee is miserable at their job and works in a toxic environment, their psychological well-being will be impacted. There is an inevitable spillover effect making it nearly impossible for them to feel a high level of happiness and life balance when away from the workplace. There is always a correlation between happiness at work and overall life satisfaction.

“When it comes to employee happiness, bosses and supervisors play a bigger role than one might guess. Relationships with management is the top factor in employees’ job satisfaction, which in turn is the second most important determinant of employees’ overall well-being,” shared the authors in McKinsey & Company’s article, The boss factor: Making the world a better place through workplace relationships. Regarding overall satisfaction with their lives, only mental health ranked higher.

Work-Life Balance: An Ongoing Conversation

The term work-life balance has been tossed around for years, and in organizational and industrial psychology, job satisfaction remains a hot topic. As well-being factors go, most if not all employees would put it on their list. And while hypotheses vary somewhat, commonalities, when employees are satisfied with their jobs, include desirable outcomes such as higher performance levels, fewer days away from the workplace, and a stronger commitment to the organization. Job satisfaction has been found to be a positive predictor of life satisfaction; happy employees tend to be happy people in general, enjoying both strong social relationships and satisfaction with family life.

Job Satisfaction Always Starts at the Top

Unfortunately, research also shows 75 percent of employees say that the most stressful aspect of their job was their immediate boss.

“Senior leaders can create a step change in both shareholder and social value by clearly articulating the sizable upsides to high job satisfaction, including educating managers on their pivotal roles and embedding quality of workplace relationships into manager development and performance appraisals,” stated Tera Allas and Bill Schaninger, authors of the McKinsey article. When leaders recognize the positive correlation between job and life satisfaction and are genuinely curious about and moving compassionately toward all employees in the organization, they are embracing servant leadership and potentially can be critical agents of change.

A strong leader instills a sense of caring, trust, and confidence in their team members. Love and trust can’t be demanded, they must be given to be received. In these types of work cultures, employees feel empowered and are more likely to give feedback on how things can be better. When employees are part of the innovation process, an incredible sense of ownership and buy-in occurs, and a significant increase in execution. And their levels of career satisfaction soar.

Countless studies show irrefutable evidence between employee satisfaction, customer loyalty, and profitability. For example, one study showed how call-center workers’ weekly sales increased by 25 percent when their happiness increased by one point (on a scale of one to five). Research in the Journal of Applied Psychology found that the top 25% of brands with the highest employee engagement enjoyed one- to four-percent–higher profit margins than those in the bottom 25%. That should satisfy the shareholder theorists.

For Employee Well-Being, Give Caring Leadership a Try

The primary duty of leaders is to care for their people. They must inspire teams to embrace a customer purpose and enable their success by allocating sufficient time, education, and resources to accomplish this mission. Leaders must role model, practice, preach, and teach the values that systematically reinforce a loving culture through symbols, words, and deeds. Employee well-being must always be top of mind.

Revolutionary Leaders Offer the Best Employee Experience

The primary question great companies need to focus on when building a world-class internal culture is ‘How does a leader help their employees live an extraordinary life?’ Research shows that this type of leadership mentality enhances both team performance and satisfaction. Similarly, when customers are happier, employees are happier, and studies demonstrate that managers themselves are happier and find their roles more meaningful when they feel they are helping their team members. Such positive emotions go hand-in-hand with subjective well-being (happiness) and lead to positive relationships in the workplace, both on the front lines and behind the scenes, as well as having a beneficial impact on the customer’s experience.

When Leaders Put Employee Satisfaction First, Everyone Wins

However, leaders will struggle with fully embracing this type of leadership style until senior management stops incentivizing the wrong behaviors, stemming from negative emotions, and instead provides the necessary leadership soft skill training that results in higher employee satisfaction. Gallup research contends that only one in 10 people possess the necessary traits exhibited by great managers, traits which include building relationships that create trust, open dialogue, and transparency. Leaders must stop ignoring the direct relationship between happiness and job satisfaction.

In an HBR article titled, “Why do so many incompetent men become leaders?”, Organizational Psychologist Tomas Chamorro-Premuzic suggests that many leaders achieve their positions by being self-centered, overconfident, narcissistic, arrogant, manipulative, and risk-prone. Establishing great relationships with people working for them is the last thing on their minds.

While this sometimes still may be true, the time of uncaring, fear-based leadership is coming to an end. It is when employees feel their leaders are approachable and truly care about them as human beings that the strongest organizations are built. Leaders enjoying their roles more take this training and management approach full circle, guaranteeing the organization’s ultimate goal: a world-class customer experience.

John R. DiJulius III, author of The Customer Service Revolution, is president of The DiJulius Group, a customer service consulting firm that works with companies including Starbucks, Chick-fil-A, Ritz-Carlton, Nestle, PwC, Lexus, and many more. Contact him at 216-839-1430 or info@thedijuliusgroup.com.