Why Employee Recognition Is More Crucial Than Ever

It’s a critical leadership skill that boosts productivity, morale and retention. Here's why employee recognition is more crucial than ever.
Why Employee Recognition Is More Crucial Than Ever

Employee recognition has never mattered more than in today’s workplace. That’s because employees want to feel valued—especially in the context of remote working. And when they don’t, it could cause them to quit and not look back. According to a survey by OnePoll on behalf of Bonusly, almost half of U.S. workers (46%) left a job because they felt unappreciated. Another 65% of respondents said they would work harder if they felt like their contributions were noticed by management. But it’s not just gratitude from managers that makes a difference. Sixty-five percent of those surveyed felt they would remain in a position with an unappreciative boss if their co-workers appreciated their work.

Recognizing employees can take many forms, including a bonus, verbal praise or a handwritten thank-you note. What remains constant are the many benefits to both employees and the organization. Here are some reasons why employee recognition is more crucial than ever.

Decreased absenteeism

According to the latest quarterly survey by Slack’s Future Forum, 43% of U.S. office workers feel burned out. When you combine burnout with employees not wanting to return to the office, that’s a recipe for absenteeism. In fact, the number of Google searches for excuses to miss work has increased by a whopping 630% from 2018 to 2022. But showing gratitude for a job well done does wonders for employee motivation. Consistent appreciation keeps everyone connected to their company goals, making them want to come to work.

Higher engagement and productivity

Employee recognition also results in higher engagement among workers. In research conducted by Quantum Workplace, when employees believe management will recognize them, they are 2.7 times more likely to be highly engaged. And when O.C. Tanner studied employee engagement, 37% of those surveyed said that more appreciation would motivate them to produce better work more often. According to Deloitte, recognition is highly correlated with improving employee engagement, which in turn improves job performance. In fact, employee engagement, productivity, and performance are 14% higher in organizations with recognition programs than those without.

Increased retention and recruitment

Studies suggest that it costs, on average, six to nine months of an employee’s salary to replace them. That can add up quickly in an environment where in some cases, employees are quitting and taking their entire teams with them. But according to a Gallup/Workhuman survey, organizations that make employee appreciation a priority have workers who are 56% less likely to look for a new job. And in a SHRM study, 68% of HR professionals agreed that employee recognition positively impacts retention, while 56% said it also helps with recruitment.

Organizations shouldn’t underestimate the power of recognizing employees in the workplace. It’s a critical leadership skill that goes a long way in boosting productivity, morale and retention. Yet many leaders do it infrequently or not at all. The formula is so simple. Create an organizational culture people don’t want to leave—and they won’t.

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