May 18, 2026
Job Market Optimism Is Rising in Europe, Gallup Finds. So Why Is Employee Engagement So Low?
Every day, news of another mass layoff hits the headlines. You might expect workers to feel increasingly insecure about the current labour market, given what’s reported on. But, depending on the region you’re looking at, that’s not necessarily the case.
In Europe, job market optimism is at a historic high, with the biggest regional gain since 2011, according to Gallup. That doesn’t mean employees are feeling positive about their jobs, though. The same data finds engagement levels in Europe to be the lowest of any region globally, with more workers actively disengaged than engaged.
The Numbers Behind the Optimism–Disengagement Paradox
In 2025, 57% of European workers said it was a good time to find a job in their area, compared to a global average of 52%. Despite this, only 12% of workers in Europe are actively engaged (compared with 20% globally), and 15% are actively disengaged.
What’s going on here? First, let’s look at the job market. The European Restructuring Monitor’s 100-day tracking period revealed a net increase of 1,981 jobs in the EU, with 94,609 positions created against 92,628 lost.
So the job market looks not buoyant, but moderately stable. While headline redundancies are taking place – such as Nissan cutting 900 jobs across the region or Commerzbank planning 3,000 job cuts in Germany – parallel business expansions appear to be absorbing much of that displaced labour.
Outward Confidence, Inward Disconnection
HR and Culture Transformation Leader Zhanna Zhuravleva highlights how these two signals – job optimism and engagement – reflect very different states of mind. “Job market optimism is outward looking: ‘I could probably find something else if I needed to.’ Engagement is inward looking: ‘Am I willing to invest myself in this job, this team, right now?'”
“The gap is being driven by years of overlapping crises – financial, pandemic, geopolitical – which have left a residue of distrust and low expectations. People no longer trust governments or institutions in the way they once did, and that ambient cynicism seeps into the workplace.”
That backdrop of institutional distrust plays out against a specific corporate reality. In the last 100 days, 378 restructuring events were reported. EY describes the restructuring reality as a ‘slow burning cycle‘ — a gradual unfolding driven by cost pressures, geopolitical uncertainty, supply chain disruption, and shifting policy. This is a chronic pressure that, likely, erodes engagement.
Zhuravleva also points to another fundamental issue: “Many European workplaces have underinvested in the one thing that shapes day to day engagement most: the quality of line management. How someone feels on a Tuesday afternoon is largely about their immediate manager, and that relationship has too often been neglected.”
The UK: A Different Problem Altogether
The job optimism felt across Europe does not translate to the UK, however. Fewer than half (49%) of UK employees say it is a good time to find a job in their local area – 8 percentage points below the European regional average. Optimism is down; and so too is engagement, with only 10% engaged at work.
The labour market data explains why. ONS figures show vacancies fell by 76,000 (9.5%) between December 2025 and February 2026 compared with a year earlier, declining across 15 of the 18 industry sectors. Unemployment rose to 4.9%, with 2.6 unemployed people for every opening between November 2025 and January 2026.
This is a fundamentally different dynamic to the broader European picture. Where many European workers may be disengaged in part because they feel they have options, UK workers are increasingly disengaged without that same sense of exit. “A ‘trapped’ worker isn’t lazily disengaged,” says Zhuravleva. “They’re in a state of learned helplessness and quiet resentment.”
The US Inversion
While in Europe workers are optimistic about the job market but disengaged in their current roles, the inverse is true in the US. Only 46% of American workers say now is a good time to change jobs – a figure that has barely moved since 2011 – but 32% are engaged. That’s 12 percentage points above the global average.
The weak job market sentiment is not misplaced. 2025 marked the weakest annual job growth since the pandemic, with only 584,000 jobs added across the full year. For context, 2024 saw two million jobs added. What’s interesting is that American workers are engaged despite a labour market that gives them little reason for feeling stable. The engagement is coming from somewhere else.
Zhuravleva attributes this to something more cultural than economic.”In America, work is more tightly bound up with identity and self-worth in a way that simply isn’t true in most of Europe, where a job is more often just a job.”
“That cultural wiring creates a baseline willingness to invest. It isn’t necessarily healthier, but it does show up in the engagement numbers.”
Different Problems, Different Fixes
For organisations operating in the UK’s tighter labour market, where workers feel they have few options, Zhuravleva is direct about what does and does not work. “When it’s hard to leave, classic engagement campaigns can feel like a slightly cynical attempt to buy people off. The first move isn’t motivation – it’s restoring agency: small choices in how work gets done, honest conversations about what’s really going on, and quick, visible wins people can genuinely own.”
Where workers do have options – across much of continental Europe – the approach changes. “When people have options, you can lean into ambition and growth. When they feel stuck, the real currency is psychological safety and a sense that they still have some influence over their corner of the world.”
