Employee engagement: why culture comes first, team building second
When a company asks for team building to “boost engagement”, something important often gets lost in translation. The request assumes that engagement works like a light switch: it is off, someone turns it on during a day out, and the problem is solved. Reality is different.
According to Gallup, global employee engagement fell to 20% in 2025, marking the second consecutive year of decline. This is not because companies have stopped organising team building events. It reflects something much deeper than a single afternoon spent together.
What the numbers actually reveal
The gap between engagement and disengagement is substantial. Only 20% of workers worldwide feel genuinely engaged with their work, while around 15–16% are actively disengaged. The remaining 64% sit somewhere in the middle: present, but not particularly invested. Europe records engagement levels of around 12–13%, the lowest among major regions, while the US and Canada reach 31%. These differences suggest that workplace cultures and organisational structures have a tangible influence on how people experience their jobs, and that engagement responds to systemic factors rather than isolated initiatives.
The economic impact is equally significant. Low engagement is estimated to cost the global economy around $10 trillion every year, equivalent to approximately 9% of global GDP. At the level of an individual organisation, the implications become much more concrete, affecting performance, retention, productivity and ultimately business results.
Managers sit at the actual lever
Manager engagement fell from 30% in 2023 to 27% in 2024, with female managers and those under 35 experiencing the sharpest declines. Engagement among individual contributors remained relatively stable at around 18%. Managers have to balance demands from senior leadership with expectations from their teams, often without the resources, support or clarity required to manage both effectively.
The influence also moves down through the organisation. When a manager feels disengaged or under excessive pressure, that sentiment can affect the entire team. Recognition is one practical lever, with companies that have strong recognition practices reporting up to a 21% increase in profitability.
The culture question nobody wants to ask
This is where team building is often misunderstood. No outdoor activity, cooking class, or escape room can create a corporate culture from scratch when that culture does not already exist. Team building does not build corporate culture from the ground up; rather, it can be a valuable diagnostic tool, reflecting the existing culture and making both its strengths and potential weaknesses more visible. This, in turn, can help organisations strengthen the former and address the latter.
Here at Team Building Milano, we work with many clients every year, and we’ve noticed a recurring pattern: companies that derive real value from team-building activities are generally those that have already invested in their corporate culture. When trust, communication, and inclusion are part of everyday life in the workplace, shared experiences tend to have a more lasting impact. And from there, organisations can continue to build on that foundation.
What engagement actually requires
Gallup’s research points towards several essential elements. Managers need to coach, listen, provide feedback and recognise contributions. Employees need clear expectations and genuine opportunities for development. Organisations need to connect individual efforts with a shared sense of purpose, while communication needs to work in both directions.
None of these elements develops automatically. They require sustained attention over time. Team experiences can reinforce them when the foundations are already there. A retreat where a manager genuinely listens to the needs of the team can become meaningful. A collaboration workshop can strengthen a group that already has a basic level of trust. Even a dinner organised to celebrate an achievement has a different impact in a workplace where accomplishments are routinely recognised.
Why engagement matters beyond statistics
Engaged employees tend to stay longer, perform better, contribute to profitability and interact differently with customers. Organisations with strong engagement cultures also report lower burnout and turnover costs. The business case is substantial, but there is another dimension that cannot be reduced to a spreadsheet: people spend a significant part of their lives at work, and whether they feel valued affects their well-being.
For organisations that genuinely want to improve engagement, the starting point is an honest assessment of the existing culture. Where is it working well? Where are the difficulties? What do managers need to perform their role effectively? What are employees waiting to hear? Only after addressing these questions can team building become a valuable tool for strengthening this process without ever replacing it.