I thought 'engagement' meant the same thing as retention time = the amount of a video that the viewer watches before clicking away or skipping through.
Youtube's algorithm for promoting and recommending videos has favoured retention time since around 2013. This encourages the content creator to make good content instead of pumping out garbage. You have to make sure that each 'episode' is engaging from start to finish. (Interestingly enough, it is believed that comments, likes and dislikes have almost no effect on the algorithm. It doesn't matter what the audience is saying about your video, as long as they watch most of it).
Phil has never cared in the slightest about engagement/retention. For a while I thought he was genuinely ignorant about Youtube switching to the retention model, but recently I heard Phil say stuff that proves he knows all about it. He just doesn't want to comply. Phil would rather be angry at the 'book-smart' programmers at Google for making a system that doesn't suit Phil, rather than try to make content that suits the system.
I once heard Phil almost literally say: "Why should I have to make engaging content?"
As for the length of his videos, I don't know, it gets complicated. It's true that gamer Youtubers benefitted the most from the engagement model because 25-minute videos are a sweet spot. But if you make 25-minute videos you need to care about making them engaging, and that means editing! Pacing, structure, beginnings and endings! Phil wouldn't get any better retention just by letting his raw kaahntent OBS clips run to 25 minutes.