The State of the Workplace 2026: The Workplace Performance Gap

Workplace strategy may feel more stable than it did during the peak hybrid-work debates, but this year’s research suggests a different story beneath the surface: a widening workplace performance gap between employee experience and what organisations measure and invest in.

Based on an anonymous survey of 679 office-based workers and executives across eight global markets and eight industries, the report explores how employee experience, workplace productivity, technology and AI are reshaping performance. 

Dive into our findings by downloading the full State of the Workplace 2026 report.

Retention is rising, but engagement is falling

Many organisations are retaining a workforce that is physically present but psychologically disengaged. 

Why does this matter? Engagement changes how people define productivity. The least-engaged employees describe productivity in transactional terms (getting through the day, avoiding mistakes), while most-engaged employees link it to value creation, purpose, and enabling others. 

The biggest barrier is everyday friction

Being productive means using my time, skills, and resources effectively to achieve meaningful results, not just staying busy. Survey Respondent

The most consistent drag on workplace performance isn’t a lack of tools, it’s the friction created when systems, processes, spaces, and support don’t work together. Employees highlight limited flexibility in office attendance (28%) as their most pressing issue, plus issues with workspace efficiency and collaboration tools. 

This points to a workplace productivity challenge that is increasingly impactful – lost minutes and a lack of clarity that compound into disengagement and underperformance.

The workplace is a performance lever, but where should we invest?

Employees increasingly evaluate the workplace as a system that either enables or hinders performance, yet only around half believe their organisation is investing in the right workplace solutions, and one in five respondents say they cannot see a return on investment from workplace initiatives that affect their space, tools or technology. 

When asked what most influences productivity in the workplace, the strongest drivers are clear: employees want to be able to focus on their work, and expect the right tools to enable that.

Organisations measure output, and employees define performance through experience

A major disconnect is emerging between traditional productivity metrics and the lived employee experience. Most organisations still track output and efficiency, yet employees view indicators like engagement and satisfaction as more reliable signs that workplace investment is paying off. 

Notably, 23% of executive leaders report they have no formal productivity KPIs (or are not aware of them). This makes it difficult to prove ROI, target investment and determine what impacts employee productivity and retention.

AI adoption is accelerating, but its impact is uneven

AI is rapidly becoming part of everyday work. 75% of employees report using AI tools, up from 59% last year. However, perceptions differ sharply by level and engagement. 

Senior leaders are more confident their skills will remain relevant, while junior employees are more likely to worry about AI’s impact. And skill insecurity is concentrated among the least engaged. 

The workplace as an ecosystem for performance

Closing the workplace performance gap requires treating the workplace as a coordinated ecosystem – aligning space, technology, services, culture, and work processes – so people can focus, collaborate, and contribute at a higher level. 

To learn more and dig deeper into our findings, download and read the full report today.