The State of Leadership 2026

Leadership trust in America is now measurable, and the measurements are not encouraging. Only 31% of U.S. employees report being engaged at work in 2024, tying the lowest level Gallup has recorded since 2013 (Gallup, 2025), while the firm estimates that low engagement drains $8.8 trillion from the global economy every year, equal to 9% of global GDP (Gallup, 2023). Managers, historically the single biggest lever on engagement, are becoming less engaged themselves: manager engagement fell to 27%, down from 30% a year earlier (Gallup, 2024). This report compiles current, independently sourced data on leadership trust, development spend, manager effectiveness, succession and diversity in the executive pipeline.

Key Findings

• U.S. employee engagement fell to 31% in 2024, matching the lowest level Gallup has recorded since 2013 (Gallup, 2025).
• Manager engagement declined more sharply than individual contributor engagement, dropping to 27% from 30% the prior year (Gallup, 2024).
• A single manager accounts for at least 70% of the variance in a team's engagement score, a foundational finding still cited as the basis for manager-first HR strategy (Gallup, established 2015).
• Organizations select the wrong candidate for a management role 82% of the time, per the same foundational research (Gallup, established 2015).
• U.S. employers spend more than $100 billion a year on corporate training and leadership development (Training Magazine, 2023).
• The U.S. quits rate, a proxy for worker confidence in leadership and the labor market, fell to 2.1% in 2024 from a Great Resignation peak near 3.0% in 2022 (U.S. BLS, 2024).
• Global CEO turnover hit a record 17.5% in 2022, the highest rate in more than two decades of tracking (PwC, 2023).
• Companies with top-quartile gender diversity on their executive teams are 39% more likely to financially outperform bottom-quartile peers (McKinsey & Company, 2023).
• A record 52 women led Fortune 500 companies in 2023, 10.4% of the list (Fortune, 2023).

The State of Trust and Engagement in 2026

Employee engagement is the closest working proxy researchers have for day-to-day trust in leadership, and in the United States it has been sliding. Gallup's ongoing workplace tracking, built on its long-running employee engagement index, put engagement at 31% in 2024, matching lows last seen in 2013 and extending a retreat from the pandemic-era high of 36% in 2020 (Gallup, 2025). The decline has been gradual rather than a single shock, which is arguably more concerning for boards trying to diagnose a root cause.

Behind the headline number sits a three-way split that Gallup has used for two decades to categorize the workforce. Roughly half of employees are "not engaged," meaning present but psychologically checked out, while nearly one in five is "actively disengaged" (Gallup, 2024). Gallup's own commentary on the 2024 data attributes part of the decline to workers under 35 and to remote and hybrid employees, groups that also report weaker clarity about what is expected of them at work (Gallup, 2024).

• Engagement stood at 31% in 2024, down from 36% in 2020 (Gallup, 2025).
• 52% of employees fall into the "not engaged" category, the largest of the three groups (Gallup, 2024).
• 17% are "actively disengaged," a group Gallup links to higher turnover and more workplace safety incidents (Gallup, 2024).
• Engagement has declined or held flat in four of the five years since its 2020 peak (Gallup, 2025).

Manager Effectiveness: The 70% Factor

No single variable predicts a team's engagement better than the person leading it. In a foundational analysis first published in Gallup's 2015 State of the American Manager report, and still cited today as the intellectual basis for manager-first HR strategy, Gallup found that the manager alone accounts for at least 70% of the variance in team engagement scores (Gallup, established 2015). The same research found that organizations have the right talent for a management role in roughly 1 in 10 candidates, meaning the wrong hire is made an estimated 82% of the time (Gallup, established 2015).

That structural importance is what makes the 2024 data on manager engagement notable. For the first time in Gallup's tracking, manager engagement fell more sharply than individual contributor engagement, dropping to 27% from 30% the prior year, while individual contributor engagement held closer to the national average of 31% (Gallup, 2024). A workforce cannot be more engaged, on average, than the managers running it, which is why HR leaders increasingly treat manager engagement as a leading indicator rather than a side metric.

The manager is not one influence on engagement among many. Gallup's research puts a hard number on it: at least 70% of the variance in a team's engagement traces back to a single person, the manager.

• Managers account for at least 70% of the variance in team engagement (Gallup, established 2015).
• Companies choose the wrong candidate for management roles 82% of the time (Gallup, established 2015).
• Manager engagement fell to 27% in 2024, down from 30% in 2023 (Gallup, 2024).
• Individual contributor engagement remained closer to the national average of 31% over the same period (Gallup, 2025).

Where Engagement Is Strongest, and Weakest

Regional differences in Gallup's global tracking are large and persistent. U.S. and Canadian workers report engagement levels well above the global average, while European workers report some of the lowest engagement of any region Gallup measures, a gap that has held for more than a decade of tracking (Gallup, 2024).

• U.S./Canada engagement stood at 31% in the most recent tracking, among the highest of any region (Gallup, 2024).
• Europe recorded engagement of roughly 13%, consistently the lowest of Gallup's major regions (Gallup, 2024).
• The persistence of this gap suggests it reflects structural and cultural differences in management practice rather than a temporary cyclical effect (Gallup, 2024).

Investment in Leadership Development

Spending on leadership and management training has held above $100 billion annually in the United States even as engagement metrics soften. Training Magazine's Training Industry Report put total U.S. training expenditures, across corporate, government and academic sectors, above $100 billion in 2023, spanning executive coaching, learning management systems and blended in-person and digital programs (Training Magazine, 2023).

Employee expectations of that investment have also hardened over time. LinkedIn Learning first identified in its 2018 Workplace Learning Report, and has continued to track in subsequent editions, that a large majority of employees say they would stay at a company longer if it invested more in their skills and leadership development (LinkedIn Learning, established 2018). The gap between stated intent to invest and employees' perception of that investment remains one of the more persistent findings in corporate learning research.

• U.S. training and leadership development spend exceeded $100 billion in 2023 (Training Magazine, 2023).
• Employee willingness to stay longer at companies that invest in development is a finding LinkedIn has tracked since 2018 (LinkedIn Learning, established 2018).

Talent Flow, Retention and the Cost of Turnover

Voluntary turnover is one of the more direct signals of trust between workers and leadership: employees who trust their manager and see a future in the organization are less likely to quit. The U.S. quits rate, tracked monthly by the Bureau of Labor Statistics through the Job Openings and Labor Turnover Survey, surged during the "Great Resignation" and has since cooled substantially (U.S. BLS, 2024).

The two series move together more often than not, consistent with a foundational Gallup analysis of exit data, first published in 2019, which found that 52% of employees who voluntarily left a job said their manager or organization could have done something to prevent it, and that voluntary turnover costs U.S. businesses roughly $1 trillion a year (Gallup, established 2019).

• The U.S. quits rate peaked near 3.0% in 2022 before cooling to 2.1% in 2024 (U.S. BLS, 2024).
• Voluntary turnover costs U.S. businesses an estimated $1 trillion a year, a foundational Gallup estimate (Gallup, established 2019).
• 52% of employees who quit voluntarily say their manager or organization could have prevented it (Gallup, established 2019).

Succession Planning and the CEO Turnover Wave

At the top of the organization, turnover has been rising even as boards face a thinner bench of ready successors. PwC's Strategy& CEO Success study, which has tracked leadership transitions among the world's roughly 2,500 largest public companies since 2000, found that global CEO turnover reached 17.5% in 2022, a record in the study's history (PwC, 2023).

PwC's long-running succession research has consistently found that a large majority of incoming CEOs are promoted from within the company rather than hired externally, though outside hires tend to tick up during periods of sustained underperformance or activist pressure (PwC, 2023). Elevated turnover raises the stakes for succession planning, which many large organizations still treat as a periodic board exercise rather than a continuously maintained pipeline.

• Global CEO turnover hit 17.5% in 2022, a record over more than two decades of tracking (PwC, 2023).

Diversity, Equity and Inclusion in the Leadership Pipeline

Diversity at the top continues to correlate with financial performance in cross-company research, even as representation of women and people of color in the most senior roles remains well below workforce parity. McKinsey's most recent update to its long-running diversity research found that companies with top-quartile gender diversity on their executive teams were 39% more likely to financially outperform bottom-quartile peers (McKinsey & Company, 2023).

• Top-quartile gender-diverse executive teams are 39% more likely to outperform bottom-quartile peers financially (McKinsey & Company, 2023).
• A record 52 women led Fortune 500 companies in 2023, or 10.4% of the list (Fortune, 2023).
• Black executives led fewer than 10 Fortune 500 companies in 2023, close to 1% of the list (Fortune, 2023).

Following the U.S. Supreme Court's 2023 ruling on race-conscious admissions and subsequent legal and political pressure, a number of large U.S. employers scaled back or renamed formal DEI programs in 2024 and 2025, even as the performance research above continued to show a measurable business case for diverse leadership teams. The gap between the performance case for diversity and the pace of representation change remains one of the more persistent findings in leadership research.

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Methodology & Sources

This report synthesizes publicly published research and government data from Gallup's State of the Global Workplace and State of the American Manager series, the U.S. Bureau of Labor Statistics' Job Openings and Labor Turnover Survey, McKinsey & Company's diversity research, PwC's Strategy& CEO Success study, Training Magazine's Training Industry Report, LinkedIn Learning's Workplace Learning Report and Fortune's annual Fortune 500 rankings. No original survey was conducted for this report; every figure is attributed to its original publishing organization and year.

Where a statistic originates from research published before 2023, primarily Gallup's manager-effectiveness and exit-interview work from 2015 and 2019, it is explicitly identified in the text as a foundational finding rather than presented as current data, consistent with how Gallup itself continues to reference that research in more recent publications.

• Gallup
• U.S. Bureau of Labor Statistics
• McKinsey & Company
• PwC
• Training Magazine
• LinkedIn Learning
• Fortune