Favoritism in the Workplace: How It Impacts Morale and Retention

Favoritism in the workplace is a major issue affecting careers, team morale, and job satisfaction. When employees feel overlooked while others receive special treatment, it can spark feelings of resentment and inequality, creating tension within teams.

Our survey of 1,000 American employees reveals how favoritism can lead to disengagement and even drive some to leave traditional jobs altogether. Knowing how favoritism operates—and how businesses can address it—is key to creating a fairer, more inclusive work environment.

Key takeaways

9 in 10 employees have witnessed favoritism at work, and 1 in 4 say it happens all the time.
2 in 5 employees have considered leaving their jobs due to favoritism, and 1 in 10 are actively planning to quit this year.
1 in 5 Americans have started freelancing or their own business to escape favoritism in traditional workplaces.
Nearly 3 in 4 employees do not feel comfortable reporting favoritism to HR due to fear of retaliation.
In-office workers are 24% more likely to observe favoritism than remote workers (31% vs. 25%).

01. Workplace favoritism is widespread

Unfortunately, most employees have seen favoritism in the workplace up close, affecting everything from daily work tasks to who gets promoted.

Asset showing The Most Common Forms of Favoritism in the Workplace

Nine in 10 Americans have seen favoritism in the workplace, with a quarter experiencing it on a regular basis. It’s most common in the tech, education, and healthcare industries. Favoritism most often plays out in special treatment (61%), work assignments (44%), and flexible scheduling or remote work opportunities (41%).

Generationally, millennials report seeing favoritism the most (31%), followed by Gen X (29%), baby boomers (27%), and Gen Z (22%). In-office employees are also more likely to spot it—31% have noticed it compared to 25% of remote workers.

Perceptions of who faces the most disadvantage from favoritism vary by gender. Among men, 33% believe men face the most disadvantages, while 26% think women are more negatively affected. In contrast, 43% of women say they experience more harm from favoritism, compared to 21% who believe men are at a greater disadvantage.

02. Workplace favoritism pushes employees to leave

Favoritism isn’t just causing resentment—it’s making employees rethink their careers. Some have even left traditional jobs to pursue their own paths and avoid unfair treatment.

Asset showing Percentage Reporting a Decrease in Key Aspects of Work Due to Favoritism

Favoritism can quietly undermine workplace culture, creating tension and mistrust that ripple across teams. Many employees lose faith in leadership, with 72% saying their trust has declined after witnessing favoritism. Another 68% report a drop in team morale, and 60% say their job satisfaction has taken a hit. Nearly half (49%) feel their career opportunities have been stunted, and 46% believe their career progression has slowed due to unequal treatment.

This breakdown in trust and morale often leads employees to consider bigger changes: 2 in 5 employees have thought about quitting because of favoritism.

Workers in telecommunications, marketing, nonprofits, tech, and finance are the most likely to want out. Millennials and Gen Z are the most affected generations, with 42% of both generations saying they’ve thought about leaving. This drops to 34% for baby boomers and 32% for Gen X. Remote workers (43%) are also about 10% more likely than in-office employees (39%) to think about quitting.

Some aren’t just thinking about it—they’re making moves: 1 in 10 employees plan to quit this year due to favoritism, and for Gen Z, it’s even higher at 1 in 7. Others have already left, with 1 in 5 Americans switching to freelancing or starting their own business to break free from workplace favoritism. For Gen Z, that number climbs to 1 in 4.

Favoritism also stirs up office politics, with 75% of employees saying it encourages gossip and cliques. Nearly half admit they’ve felt pressured to be extra agreeable with managers just to counter favoritism.

03. How to reduce workplace favoritism and build trust

Fear of retaliation often keeps employees silent about favoritism, allowing the issue to persist and limit opportunities for others. Reducing favoritism requires leadership accountability, fair policies, and a commitment to creating equal opportunities for all.

Asset showing Top Ways to Reduce Favoritism and Create a Fairer Workplace

Nearly 3 in 4 employees don’t feel comfortable reporting favoritism to HR, largely due to fears of retaliation. Gen X workers (75%) are the most hesitant to speak up, worried that addressing the issue could lead to negative consequences.

Overall, employees believe the most effective ways to combat favoritism include clear promotion criteria (48%), leadership accountability (47%), and anonymous feedback systems (42%). They also think providing equal access to training (36%) and enforcing conflict-of-interest policies (35%) can help ensure fair treatment.

Baby boomers and Gen X see holding managers accountable (51% and 52%) as the best solution, while millennials and Gen Z prefer clear and transparent promotion criteria (both 48%).

Additional measures, like standardized performance reviews (32%) and bias training for managers (32%) could further support fairness, while whistleblower protections (30%) and third-party audits (25%) could provide valuable oversight. Diversity and inclusion training ranks lowest on the list, with only 18% seeing it as a key solution.

04. Methodology

We surveyed 1,000 American employees to reveal the widespread impact of workplace favoritism on employee satisfaction, retention, and team dynamics. The average age of employees was 39; 44% were women, 54% were male, and 1% were non-binary. Generationally, 4% were baby boomers, 23% were Gen X, 58% were millennials, and 15% were Gen Z.

05. About SideHustles.com

SideHustles.com helps you find and succeed in side hustles with advice that’s easy to follow and trustworthy. Our content is created by real pros who know what it takes to make it in the gig economy. We also offer unbiased ratings for gig apps, so you can confidently choose the right tools for your side hustle.