MacOS Monterey update 12.2 seems to have solved this issue, it means that the problem comes from the MacOS! see this article : https://mrmacintosh.com/macos-monterey-12-2-update-21d49-whats-new/

I Have the same issue (i'm using MBP M1 2020, with exchange account through MS outlook), first started from my outlook searchbox, it's really annoying and make my workflow disastrous, since i'm very relied in this particular feature. it happens once few years ago when i'm still in big sur. but the problem solved when i reindex with spotlight setting. But this time,, it happen again when i recently upgrade to Monterey 12.1 (Monterey 12.0.1 works fine with it). I tried the same way with spotlight setting and it still showed no result. then i tried to fix through terminal with "sudo mdutil" command to reset the spotlight, and this is where it gets worst, now my spotlight can't search through my mac properly. My documents, apps, and photos still there, but the spotlight shows only things from the web, not in my mac. This drives me crazy since i haven't find any fix on the web for this issue. Though i tried all the things i got from forums all over the web : spotlight reindex, using terminal, reinstall outlook, update to 16.57/ 16.58, i can't change to new outlook mode since i'm using exchange account. Then i ran into conclusion that this is monterey's problem, not the outlook. since reindexing in the system itself got chaotic, not only in outlook. so i decided to downgrade my Mac to Big Sur. Backup my files with time machine, and then reinstall mac to Big Sur. And IT FIXED! such a relief to got this function back again. if you have the same problem with me, just downgrade to Big Sur, and wait till this issue noticed by apple and hopefully they'll fixed it. This is the following steps i do to downgrade safely to Big Sur : Download Big Sur through app store : https://apps.apple.com/gb/app/macos-big-sur/id1526878132?mt=12 Make a bootable drive (i'm using flashdisk USB) : https://www.youtube.com/watch?v=dQCp-rQlZuY Back up Mac using Time Machine (i'm using external HD) : https://www.youtube.com/watch?v=A6S8Al1WHdc&t=2s Boot to MacOS recovery, erase disk, and install macOS using bootable drive (Flashdisk USB in step 2) : https://www.youtube.com/watch?v=Ae_Vm39dxrA&t=579s After installation finished, you'll enter the settings menu just like when you first bought a new mac. it will ask you if you want to use migration assistant, use this to recover your files, settings, apps, from time machine back up : https://www.youtube.com/watch?v=ofiEykZWiwo&t=366s hope this will help for you guys, until apple fixes this frustrating issue.