Internal communications statistics on employee alignment, engagement, and retention

There is a direct correlation between high employee alignment, engagement, and retention, and effective internal communications. 

• Why it matters: When leaders share clear and engaging communications, employees understand company goals more effectively and spend less time searching for or clarifying the details they need to perform their jobs. This translates to less salary and time wastage, as well as better alignment and engagement.

The irony: Leaders vastly overestimate how clear and engaging their communications are, and this is costing them thousands of dollars in salary waste each year. In the State of Internal Communications Report, we spoke with 813 employees in full-time entry-level, intermediate, or middle management roles, as well as 457 leaders employed full-time in a C-level, executive, or senior role at organizations with 11 or more employees.

Here's what's happening. 

The high cost of ineffective communications

Ineffective communication costs companies hundreds of lost working hours and thousands of dollars in lost salaries each year. Our report shows that a single employee earning between $50,000 and $100,000 loses 35+ working days per year due to ineffective communication. That’s equivalent to a $10,140 salary loss per employee per year due to ineffective communication. 

Employees also told us that they spend only 63% of their workday executing core job responsibilities, while 34% of the time is spent dealing with distractions and avoidable meetings.

This data builds upon our 2024 findings, where we saw:

• 48% of C-level leaders have to get more involved in projects than they typically should due to ineffective communication.
• 10% of leaders who prepare critical updates spend 10+ hours per week providing the updates. 20% spend 5 to 10 hours, 34% spend 3 to 5 hours, 27% spend 1  to 2 hours, and 9% spend less than an hour providing the updates.

• Senior employees lose 63 work days per year due to ineffective communication. 
• Ineffective communication costs organizations $54,860 annually for every senior employee earning over $200,000 per year.

Among all the leaders we surveyed in 2025, 33% were forced to set aside their tasks to put out more effective fires caused by ineffective communication. Another 30% were drawn deeper into projects than they should have, while 27% spent too much time clarifying or reinforcing objectives, goals, or organizational policies. 

Although this data shows improvement from our 2024 report, it still shows a significant waste of company resources, especially when high-salaried leaders are the ones spending their time bridging communication gaps that should have been addressed earlier.

Here are our 2024 findings across different leadership levels.

For C-suite, President, or Owner: 

• 48% have gotten more involved in projects than they should have due to ineffective communication. 
• 43% spend too much time clarifying or reinforcing communications with staff.
• 41% have seen higher employee turnover due to ineffective communication.
• 40% have had to set aside important tasks to put out immediate fires due to ineffective communication.
• 34% say their organization lost a customer or underperformed on a project due to ineffective communication.
• 20% have seen poor morale among employees due to ineffective communication.

For VP or senior leaders:

• 34% have gotten more involved in projects than they should have due to ineffective communication.
• 37% have spent too much time clarifying or reinforcing with staff due to ineffective communication.
• 31% have seen higher employee turnover due to ineffective communication.
• 38% have had to set aside important tasks to put out immediate fires due to ineffective communication.
• 29% say their organization lost a customer or underperformed on a project due to ineffective communication.
• 22% have observed poor morale among employees due to ineffective communication.

What’s next: Effective communication boosts employee morale and productivity. Discover the five communication strategies used by leaders at Lyft, Salesforce, and UPS to build stronger workplace cultures. 

Employee alignment with company goals and strategy

Employee alignment with company goals is declining, and our research indicates a correlation between this decline and ineffective internal communications.

• 27% of leaders think their staff are entirely aligned with the organization’s business goals, but only 9% of employees agree with them.
• 80% of leaders think their internal communications are helpful, relevant, and have the context teams need to do their jobs, but only 53% of employees agree with them.
• 73% of leaders think teams can quickly resurface goals, strategies, or key directives when needed, but only 49% of employees agree with them.
• 80% of leaders think their internal communications are clear and engaging, but only 50% of employees agree with them. 

While 79% of employees say that the quality of communication they receive impacts how well they understand leaders’ goals, only 12 to 16% of employees say that the critical updates they receive from leaders, which they need to do their jobs well, are “very effective.” 

In 2024, we asked the employees what their leaders could do to improve their communication.

• 37% of employees want communications on a more consistent cadence.
• 36% of employees want the opportunity to provide feedback.
• 35% of employees want more thoughtful and insightful details in the communications they receive.
• 34% of employees want to receive updates more frequently from leadership.
• 33% of employees want to receive communications covering more relevant topics.

Organizations that increased investment in internal communications were more likely to see improvement in several key business areas. 

• New business revenue: 63% of organizations that increased their investment in communications saw new business revenue, compared to 37% whose communication investment remained flat or decreased.
• Net-dollar retention: 66% of organizations that increased their investment in communications saw improved net-dollar retention, compared to 34% with flat or reduced communication investment.
• Market share: 67% of organizations that increased their investment in communications saw growth in market share, compared to 33% with flat or reduced communication investment.
• Reputation in the market: 69% of organizations that increased their investment in communications saw an improvement in market reputation, compared to 31% with flat or reduced communication investment.
• Innovation and competitive advantage: 66% of organizations that increased their investment in communications saw gains in innovation and competitive advantage, compared to 34% with flat or reduced communication investment.
• Customer retention: 67% of organizations that increased their investment in communications saw better customer retention, compared to 33% with flat or reduced communication investment.
• Satisfaction / eNPS scores: 73% of organizations that increased their investment in communications saw higher satisfaction or eNPS scores, compared to 27% with flat or reduced communication investment.
• Adherence to policies: 72% of organizations that increased their investment in communications saw better adherence to policies, compared to 28% with flat or reduced communication investment.
• Alignment with business goals: 68% of organizations that increased their investment in communications saw better alignment with business goals, compared to 32% with flat or reduced communication investment.
• Engagement at work: 68% of organizations that increased their investment in communications saw improved engagement at work, compared to 32% with flat or reduced communication investment.
• Culture/morale: 72% of organizations that increased their investment in communications saw improved culture or morale, compared to 28% with flat or reduced communication investment.
• Employee retention: 68% of organizations that increased their investment in communications saw improved employee retention, compared to 32% with flat or reduced communication investment.

What’s next: Learn more about the seven ways to measure the effectiveness of your internal communications.

Employee engagement

Over 70% of employees say that how well they understand company goals affects their engagement at work. We asked employees which areas of their work are impacted when they understand the company goals. 

Among employees:

• Productivity increases by 63% when employees clearly understand company goals and are engaged.
• Motivation improves by 59% when employees clearly understand company goals and are engaged.
• Satisfaction increases by 54% when employees clearly understand company goals and are engaged.
• Collaboration improves by 45% when employees clearly understand company goals and are engaged.
• Problem solving improves by 44% when employees clearly understand the company's goals and are engaged.
• Creative thinking improves by 37% when employees clearly understand company goals and are engaged.
• The ability to stick to project timelines increases by 35% when employees clearly understand company goals and are engaged.
• Analytical thinking improves by 28% when employees clearly understand company goals and are engaged.
• Employee bandwidth improves by 15% when employees clearly understand company goals and are engaged.

Among employees, 50% say they’ve found themselves doing the bare minimum at work, and 15% say they’re currently in that situation. Another 20% say they’ve been there within the past year. 

Things like better compensation (50%) and a clear career advancement path (22%) were among the top drivers that would have helped employees want to go above and beyond at work. Interestingly, 18% of staff said better communication about organizational priorities would have helped, while 11% said clearer context on business goals would have made the difference in rising above their minimum job requirements.

This all ties back to effective workplace communication. In fact, the employees in our study told us they’d be more likely to go above and beyond in their job responsibilities if they were better informed about:

• Their career growth opportunities (44%)
• The role they play in bringing key initiatives to life (39%)
• Leadership’s decision-making process (38%)
• Tools and resources available to help them (33%)
• Why and when goals and operations shift (31%)

A regular internal newsletter is the solution to employee disengagement. “Every CEO I know is struggling with employee engagement in a hybrid world. A regular, ongoing newsletter cadence where you’re... 

• communicating with the employee 
• on a regular basis
• That's run and managed by the CEO

 ...is the only and/or best answer to: “How do you develop a culture that works to promote associate engagement in a post-COVID world?” says Chuck Cohen, Managing Director of Benco Dental. 

What’s next: Axios HQ is a powerful internal communication platform that helps leaders cut through the noise and deliver clear, engaging messages that keep teams aligned and informed. Organizations such as Cox, J&J, and Yahoo have used Axios HQ to streamline internal processes, clarify business objectives, and boost engagement. Get in touch with our team to learn how our expert writing workshops and results-driven newsletter software can enhance your workplace communications.

Employee performance

Employee alignment and engagement tie directly to performance. Strong performance and engagement result in stronger employee performance. Leaders report that when employees are strongly aligned with organizational goals, they notice their team's ability to: 

• Operate efficiently (62%)
• Increase revenue and profits (53%)
• Maintain or grow their customer base (49%)
• Remain competitive (47%)
• Be seen as innovative (39%)

So, if effective communication boosts employees' performance and contributes to increased revenue and profits, as well as growth in the customer base and competitiveness, why aren’t more organizations building effective internal communications? Here’s what leaders told us is standing in the way:

• 29% of leaders say that making time to communicate well is a major barrier to more effective communications.
• 25% of leaders identify a lack of a well-resourced communications team as an obstacle.
• 25% of leaders report that breaking through information overload stands in the way of effective communication.
• 22% of leaders cite the lack of data and feedback to measure success as a challenge.
• 20% of leaders believe writing in a concise, engaging way is a key difficulty.
• 20% of leaders say streamlining the writing and sign-off process is a barrier.
• 20% of leaders indicate that understanding what readers need is a challenge.
• 19% of leaders report that evolving their strategy for hybrid work is an obstacle.
• 18% of leaders say involving the communications team early in projects is a challenge to effectiveness.

Hybrid and remote team performance hugely relies on their ability to access the critical information they need to perform their jobs well, according to 26% of employees. Another 26% report that the ability to collaborate with teammates is a key factor, while 25% say the effectiveness of team communication channels impacts their ability to perform well.  

Leaders must invest in effective communication practices and infrastructure if they want to boost employee performance and drive business growth. 

Retention of top employees

In 2025, 85% of leaders say they’re actively hiring, but only 71% report that they actually expect their staff to grow this year. And while leaders are keen to retain their top talent, there is a gap between what they’re doing to achieve that and what top employees say it would take for them to stay. 

• 64% of employees say compensation increases would make them want to stay at their company, compared to 32% of leaders who plan to focus on this to retain talent.
• 47% of employees want expanded benefit packages, while only 21% of leaders plan to offer them.
• 39% of employees are looking for clear career growth paths, but only 36% of leaders are prioritizing this.
• 36% of employees value expanded flexible work policies, while just 12% of leaders plan to implement them.
• 30% of employees believe improving workplace communications would help retention, compared to 33% of leaders who see it as a priority.
• 24% of employees want more upskilling opportunities, while 33% of leaders plan to invest in them.
• 23% of employees want their organization to prioritize workplace culture, while 32% of leaders say they will focus on this aspect.

Internal communications cadence, accessibility, and reliability 

Communication cadence must be consistent and reliable to help employees build routines around critical leadership and management updates. 

• 72% of leaders say internal communications are timely and on a cadence that teams can rely on, but only 48% of employees agree.
• 72% of leaders think teams have an easy and accessible way to share employee feedback about internal communications, but only 46% of employees agree. 

Among employees, 67% say they prefer emails or newsletters for receiving critical updates, while 39% prefer in-person meetings, and 24% prefer virtual staff or department meetings.  

In our 2024 surveys, we examined the communication channels that leaders use vs. the channels employees preferred at the time. 

• All-hands or department meetings: 36% of employees prefer all-hands or department meetings for receiving critical updates. 36% of leaders use this channel. 
• Ad hoc emails: 30% of employees prefer receiving critical updates via ad hoc emails. 32% of leaders use this channel.
• Newsletters: 22% of employees prefer receiving critical updates through newsletters or recurring updates. 24% of leaders use this channel.
• Text messages: 22% of employees prefer receiving critical updates via text messages. 30% of leaders use this channel.
• Instant messaging/online chat tools: 18% of employees prefer chat or instant messaging tools for receiving critical updates. 33% of leaders use this channel.
• Employee apps: 16% of employees prefer employee apps for receiving critical updates. 34% of leaders use this channel.
• Phone calls: 16% of employees prefer receiving critical updates via phone calls. 33% of leaders use this channel.
• Intranet: 14% of employees prefer receiving critical updates via intranet updates. 24% of leaders use this channel.
• Video messages: 11% of employees prefer receiving critical updates via video messages. 27% of leaders use this channel.
• Digital signage: 10% of employees prefer physical or digital signage for receiving critical updates. 23% of leaders use this channel.
• Podcasts: 4% of employees prefer podcasts for receiving critical updates. 20% of leaders use this channel.
• Other methods: 5% of employees prefer other methods for receiving critical updates. 1% of leaders use this channel.

While there was some alignment between the top channels that employees preferred vs the channels leaders used, the data showed misalignment towards the bottom, where leaders vastly overused channels such as employee apps, phone calls, intranet, video messages, and digital signage.  

What’s next: Conduct a pulse check to identify the communication channels your team prefers for various company news and updates. Adopt and give each channel a unique identity to enhance the employee experience and ensure your team knows where to go for specific types of updates. 

Difficult topics (DEI, RTO, AI, and politics)

Leaders must engage in difficult topics to win employee trust and drive engagement. But while 45% of leaders claim to proactively engage in tough topics and communicate a perspective, only 23% of employees agree with them, according to our 2024 report.

In 2025, leaders identified three critical topics that will be hard to address with their staff. 

• 41% of leaders say addressing the safe adoption of AI will be a difficult conversation to have with employees, up from 40% in 2024. 
• 30% of leaders say political issues and impacts. This is a slight increase from the 29% reported in 2024.
• 30% say return to office or other hybrid shifts
• 29% say hiring and team structure decisions will be a difficult topic to address.
• 27% say upskilling and reskilling for the future.
• 23% say DEI changes, progress, and accountability

Over 50% of leaders whose organizations have DEI policies say that they expect to scale back these policies in 2025, and 37% of leaders also expect an increase in office requirements in 2025. But interestingly, 31% of hybrid and remote employees say they would look for a new job or accept termination if their organizations increased in-office requirements.

Go deeper: How executives are handling DEI, RTO, and hiring in 2025