Beyond burnout: What studies reveal about the future of employee wellbeing

Mercer’s 2024 talent trends finds that many elements of workplace experience have improved since 2018, including communication, empowerment, and career opportunities. Meanwhile, the McKinsey Health Institute’s global research from 2023 shows that only 57% of employees report good holistic health, with one in five experiencing burnout. In a follow-up study co-authored with the World Economic Forum in 2025, McKinsey outlines how addressing the full spectrum of employee wellbeing could unlock over $11 trillion in economic value.

Mercer’s data, drawn from over 8.5 million employees globally, reveals that more people today feel empowered, recognised, and fairly treated at work than they did five years ago. Engagement scores remain high, with nearly eight in ten employees expressing pride in their companies and willingness to contribute discretionary effort. Compared to 2018, 14% more employees feel they are compensated fairly, and more believe they can reach their full potential within their current organisation.

But since 2021, that upward momentum has slowed. More than 60 individual survey items have registered declines, some of them significant. Fewer employees feel their compensation is fair compared to just twelve months ago. Work-life balance, perceptions of flexibility, and confidence in manager support have all declined. Notably, there has been a 5% drop in the number of people who believe inappropriate behaviour at work will be addressed if reported — a finding that underscores growing concerns about organisational accountability.    

McKinsey Health Institute’s 2023 study reframes wellbeing as a multidimensional challenge, encompassing not only physical and mental health, but also social belonging and a sense of purpose. Based on this broader definition, the study found “about half of employees (49%) are faring well. Well-functioning across the dimensions of holistic health and simultaneously experiencing low rates of burnout symptoms”. 

However, an average of 9% of employees are “stretching”, well-functioning across the dimensions of holistic health and experiencing high rates of burnout symptoms. 

“Almost a third of employees are managing, experiencing suboptimal functioning across the dimensions of holistic health and experiencing low rates of burnout symptoms. 

The group struggling the most are those employees who are drowning. experiencing suboptimal functioning across the dimensions of holistic health and high rates of burnout symptoms,” the study said.   

These states are more than academic categories. They have direct business consequences. McKinsey links them to tangible outcomes such as absenteeism, turnover, innovation capacity, and customer satisfaction. Organisations with a high proportion of thriving employees tend to outperform their peers across a range of metrics. Conversely, poor employee health erodes performance from the inside out. However, the report offers hope. 

   

One of the clearest insights across all three reports is that employee wellbeing is most powerfully shaped by factors embedded in the day-to-day experience of work. Psychological safety, role clarity, inclusive leadership, and a sense of meaning at work are not just idealistic notions. They are the practical foundations of sustainable performance. 

Mercer’s findings highlight that employees feel most positive about areas where identity and belonging intersect. “Eight in 10 people feel their companies actively support diversity in the workplace, with the same proportion feeling they can be themselves at work,” it said. 

Most employees feel respected by their managers and have a strong sense of connection within their teams. “Over 80% among the millions in our database are confident in the future of their organisations. Even if far fewer express confidence in senior leaders, where broadly six in 10 feel their senior leaders walk the talk with actions consistent with their rhetoric,” according to the Mercer report. 

Similarly, McKinsey finds that employees who feel fairly treated, valued, and heard are far more likely to report good holistic health. In contrast, employees experiencing toxic workplace behaviour are six times more likely to suffer from burnout. 

While the average experience has improved in recent years, the data reveals stark disparities across demographics. Younger workers, those identifying as LGBTQI+, people with caregiving responsibilities, and employees with lower income or education levels are significantly less likely to report good health and more likely to experience burnout. 

McKinsey and Mercer both flag the importance of addressing these inequities directly. The notion of a “resilient workforce” cannot rely on averages when certain groups consistently fall behind.   

There is “welcome news after all the effort to improve DEI activities within organisations. Even more employees feel a sense of belonging within their teams, and believe their managers treat them with respect and dignity,” according to the Mercer report. 

The McKinsey–World Economic Forum “Thriving Workplaces” report, released in 2025, outlines a strategic framework for improving employee wellbeing that resonates across all three studies. It calls for change at every level of the organisation. 

According to the reports, leaders must integrate wellbeing into business strategy, redesign roles to prevent overload, and prioritise manager capability as a key enabler of health. Teams must cultivate environments where people feel safe, supported, and respected. Jobs must be structured to provide clarity, autonomy, and alignment with personal values. And individuals need opportunities to develop the skills that support adaptability and purpose in a changing world. 

Mercer’s data supports this approach, suggesting that organisations that genuinely invest in wellbeing, not just rhetorically but operationally, are more likely to maintain employee engagement even in difficult conditions. 

   

Across all three studies, one message rings clear: the conditions of work have a direct and lasting impact on people’s health, sense of purpose, and ability to contribute. 

While many companies have made measurable progress since 2018, the post-pandemic landscape has introduced new pressures. 

Rising costs, digital disruption, and growing social complexity mean that employee expectations have changed, and will continue to evolve. Today’s workforce wants more than a paycheck. They want to feel safe, valued, and inspired by what they do. They want to believe that their leaders care about their wellbeing and that their work has meaning beyond metrics.

Work is changing, and so must the workplace. These three reports provide not just a diagnosis, but a roadmap. There is a need for some action now.