Recognizing employees for their contributions is a gift that keeps on giving. When organizations take the time to acknowledge their workers’ accomplishments, they are able to increase retention. Appreciated employees are also more productive, with better morale and strong workplace relationships — all of which benefits the organization.
What Is Employee Recognition?
Employee recognition refers to an employer’s efforts to call attention to its employees’ accomplishments. The most common employee recognition programs recognize one-time achievements, exemplary performance over time or length of service at a company. Recognition comes in many forms — from spontaneous celebrations to more formal programs that highlight standout work. To be sure, employees want to hear it: A survey of more than 600,000 U.S. employees by Quantum Workplace found 53% want to receive more recognition from their immediate manager.
Organizations that recognize great work and reward employees with positive attention or more concrete benefits realize many qualitative and quantitative benefits. Indeed, when employees feel a sense of belonging — that they’re respected and are being treated fairly — at work, organizational performance benefits, according to 93% of respondents, including HR directors and C-suite leaders, who participated in Deloitte’s 2020 “Global Human Capital Trends” survey. Today, employee recognition programs that aim to improve employee engagement, workplace relationships and organizational culture are widespread.
Why Does Employee Recognition Matter?
While HR departments have many responsibilities, the biggest include managing employee retention, turnover and recruitment. This team is also in charge of improving employee engagement and satisfaction, maintaining morale and productivity and ensuring healthy and functional workplace relationships. Employee recognition programs can positively impact all of those areas. Eighty-two percent of employed adults consider recognition an important part of their happiness at work, and 82% feel happier as a result, according to a SurveyMonkey study.
When an organization highlights its employees’ achievements and abilities, workers are more likely to feel that they matter. In turn, they tend to be happier and have stronger relationships with colleagues and management. They also work harder and more effectively, which may earn continued recognition and create a virtuous cycle.
25 Employee Recognition Statistics That Matter
Research shows that employee recognition and rewards programs deliver business value. Below are more than two dozen statistics that demonstrate this value across seven areas of focus for HR departments.
U.S. employers spend hundreds of millions of dollars every year recruiting and training new workers. Both job candidates and HR professionals recognize the value of employee recognition in the recruiting process. Supporting statistics include:
- Fifty-six percent of HR leaders told the Society for Human Resource Management (SHRM) that employee recognition programs help with recruiting top talent. As employee satisfaction and experience improve, individuals are more likely to serve as employer brand ambassadors.
- People want to work for organizations that recognize their employees — it’s one of 10 top employer traits they look for. They also look for organizations that are honest, compassionate, trustworthy and have integrity.
It makes perfect sense that recognition (or a lack of it) influences an employee’s desire to stay with an organization. Supporting statistics include:
- Organizations with employee recognition programs see improved retention rates and lower turnover. In fact, more than two-thirds of HR professionals told SHRM employee recognition helps with retention.
- For 55% of employees who planned to switch jobs, lack of recognition was the No. 1 culprit in driving their decision, according to an Achievers.com survey. Even more telling: 69% would have been more likely to stay if their employers offered more rewards and recognition.
- Promotions and career advancement are another way to recognize and reward employee performance. LinkedIn indicates that seven out of 10 employees who received a promotion remained with that employer three years later.
High-retention workplaces tend to have more engaged workers who, as a result, are often more productive. Supporting statistics include:
- Individuals who felt their employers’ rewards met their needs were seven times more likely to say they were engaged at work than employees who were dissatisfied with their organizations’ rewards, according to a survey from HR services firm Alight.
- Fifty-six percent of employees who felt a strong sense of belonging at their organizations reported a higher level of overall job performance, according to online career coaching firm BetterUp.
- Happier workers are 13% more productive at work, an Oxford University report found.
- Eighty-four percent of HR professionals said employee recognition programs had a positive impact on employee engagement, per SHRM. Highly engaged workers deliver increased sales, greater profitability and higher customer ratings.
The appreciation workers feel when they are recognized can improve corporate culture and also has a positive effect on their workplace relationships. Supporting statistics include:
- Nearly all HR professionals (87%) agreed, noting that employee recognition programs improved workplace relationships, SHRM says.
- Forty-one percent of employees want more recognition from their immediate co-workers, per Quantum Workplace.
Management’s ability to recognize team members, particularly during challenging times, can motivate employees. Even a quick nod from a high-ranking leader goes a long way. Supporting statistics include:
- Gallup shows that managers’ ability to inspire others is one of seven top leadership competencies that drive high-performing teams. The ability to inspire includes not only providing vision and exuding confidence, but also recognizing and rewarding employees for exceptional effort.
- In addition, managers themselves credit recognition as a key factor in their own happiness and effectiveness. The vast majority (83%) of senior managers considered recognition critical to their work satisfaction, per SurveyMonkey.
- Recognition also correlates with a team’s sense of meaning and purpose, says Gallup, which found 74% of U.S. employees who said their teams receive praise also strongly agreed that they felt what they were doing was both valuable and useful.
When organizations and managers make it a practice to recognize or reward employees, they create goodwill as well as strong connections. That generates trust. Supporting statistics include:
- Nearly one-third of a worker’s desire to remain or leave an organization is the result of trusting (or not trusting) their boss, says LeadershipIQ.
- How a company treats its employees is one of the best indicators of its level of trustworthiness, according to 78% of 33,000-plus respondents to Edelman’s global “2019 Trust Barometer.” The research also found that employees who trust their employers are far more likely to advocate for their organizations (78%), are more engaged (71%), and remain far more loyal (74 percent) and committed (83%) than those who are less trustful.
- Team recognition boosts trust among employees. Two-thirds of those on “adequately praised teams,” per Gallup, strongly agreed they trusted their colleagues.
Employee morale reflects the overall outlook, satisfaction and the level of confidence employees feel at work. Rewarding and recognizing staff contributes to positive morale. For example:
- Employee recognitions programs increase employee happiness, according to 82% of HR leaders in the SHRM study. These programs also improve organizational culture (86%) and elevate the employee experience (89%).
Ways to Recognize Your Employees
Developing and communicating an effective employee recognition program is important. At a high level, securing a budget for employee recognition strategies and that can assist in these efforts boosts the chances for a successful employee recognition program.
Programs that recognize and reward workers specifically for efforts that advance their companies’ core values are popular. Seven out of 10 HR leaders said their employee recognition programs are aligned with their companies’ values, and for good reason. Values-focused employee recognition programs are twice as likely to drive or reinforce business goals, 33% more likely to focus on employee empowerment and 29% more likely to target the creation of a positive employer brand in the talent marketplace.
With those overarching guidelines in mind, HR leaders can employ a variety of tactics to recognize the efforts of individual contributors. Tactics include enterprise-wide acknowledgement and formal awards, financial rewards and praise from a manager or peer. Supporting statistics include:
- Three-quarters of professionals said a simple “thank you” is all it takes to make them feel recognized, according to a two-year study by Deloitte.
- Given the choice, 57% of employees said they would opt for recognition in the form of a cash bonus or raise, per SurveyMonkey. Non-financial approaches are also valuable — one in five employees chose visibility to senior leaders as their preferred form of recognition, and nearly as many (17%) value employee awards.
- Personalization is appreciated: Two-thirds of employees are more likely to value two tickets to a concert of their choice versus getting three times the value of those tickets added to their paychecks over a year, an Xexec survey notes.
- The rewards most beloved by workers include annual leave (43%), public recognition (15%) and team drinks (15%), per Xexec.
- The same survey says most employees would rather celebrate rewards with their families (52%) than with colleagues (39%).
Organizations and managers can deliver employee recognition and rewards in a variety of ways. Some employees may shy away from public pronouncements but value off-the-cuff, ad-hoc pats on the back. Supporting statistics include:
- Some employees prefer receiving positive feedback on performance in one-on-one meetings with their managers (38%). The next-most popular forums are team meetings (25%) or during annual reviews (16%), more so than via public messaging channels (11%), according to SurveyMonkey.
- Individuals also like surprises. Nearly half of employees actually prefer rewards or recognition that are unplanned, Xexec notes.
While a well-thought-out and company-specific employee recognition program is most likely to deliver the greatest benefits, a culture that encourages continuous demonstrations of appreciation is also important. In-the-moment recognition and small awards that don’t require approvals can be invaluable.
Recognizing employees’ exceptional work and their value to the success of the larger organization delivers dividends that can be tracked in a human resources management system. Effective employee recognition programs focus on understanding what employees value and how to acknowledge and reward their contributions. Doing so motivates employees and keeps them engaged, in turn boosting business performance and value.