Recruiters, possibly more than most professions, see the value in performance recognition, especially when it comes to financial incentives that reward achievement.

However, employee recognition is “one of the most effective and affordable wellbeing strategies [that is] woefully untapped”, according to a 2022 report from Gallup, ‘Amplifying Wellbeing at Work and Beyond Through the Power of Recognition’.

Describing wellbeing as both “a universal need of employees… and a high-stakes foundation to organisational outcomes”, the report notes that wellbeing or the lack of it influences outcomes with “serious price tags, including hindering employee productivity and engagement as well as leading to burnout and turnover”.

And the report goes on to say, “it’s one of the simplest tactics at leaders’ fingertips”.

The report focuses on a large-scale study by Gallup and Workhuman of more than 12,000 employees across 12 countries, which demonstrated that fulfilling employee recognition is associated with better employee wellbeing across four key dimensions:

• Increased overall life evaluations – Employees are as much as two times as likely to evaluate their lives and futures positively.
• Reduced levels of burnout – Employees are up to 90% less likely to report being burned out at work “always” or “very often”.
• Improved daily emotions – Employees are up to two times as likely to report having experienced a lot of gratitude the previous day and about 40% less likely to report having experienced a lot of stress, worry and sadness.
• Better social wellbeing – Employees are seven times as likely to strongly agree that they have meaningful connections or a best friend at work, and as much as 10 times as likely to strongly agree that they belong.

When organisations weigh costly Employee Assistance Programmes and health insurance offerings, they often overlook the most accessible and affordable ways to promote wellbeing: by simply recognising their employees for who they are and what they do.

Workplaces shape wellbeing every day, for better or worse, by the way they treat their employees. Leaders who strategically incorporate recognition into their culture can drastically improve employees’ perceptions that they’re valued, cared for and respected as people. Also, recognition can spark cultural transformation and help workplaces achieve exceptional performance; when recognition is part of leaders’ wellbeing efforts, the outcomes and return on investment (ROI) are extraordinary.

Conversely, the costs of neglecting wellbeing are real and significant, for employees personally and for their employers:

• $20m (£17.44m) of opportunity loss for every 10,000 workers due to low wellbeing and its drain on performance
• $322bn (£280.89bn) cost globally in turnover and lost productivity when low wellbeing shows up as employee burnout (see source below box right, p15).

In the UK, the survey found that 24% of respondents rated at least three of the five pillars of recognition (see box, p15) as fully fulfilled. Of the 12 countries surveyed, the UK emerged on top alongside Norway, which also achieved 24%. The two bottom slots were held by Ireland, at 14%, and Finland with 12%.

Wellbeing is about a life well lived; it is about being fulfilled in the aspects of life that matter most”

When it comes to recognition, the study found a big difference between perfunctory and genuine, “and employees can tell the difference”, the report said. “They know whether you mean it – and they want to feel valued for their authentic selves…

“This is why organisations should be deliberate in how they institute and scale recognition.”

Sadly, the survey results reflected a disconnect between organisational leaders and employees around the subject of recognition. Members of the Gallup Chief Human Resource Officers Roundtable revealed that 65% of CHROs strongly agree that their organisation cares about the overall wellbeing of their employees, but only 24% of their employees concur. “The consequences of appearing apathetic about wellbeing are overwhelming, particularly burnout and attrition. The onus is on leaders and managers to show employees, with real and meaningful actions, that they care,” the report said.

Five essential elements of wellbeing

Employers can make a difference in every one of the essential elements of wellbeing. Yet many simply go through the mechanics of providing jobs and paychecks without ever realising that work can be so much more.

1. Career wellbeing refers to how people spend their days and whether or not they generally like what they do with their time.
2. Social wellbeing refers to people’s relationships with others and whether or not they have meaningful connections and positive interactions with others.
3. Financial wellbeing refers to people’s economic activity and standard of living and whether or not they have the funds they need to provide for themselves and/or their family.
4. Physical wellbeing refers to people’s health and physical condition and whether or not they have the energy and endurance to be productive each day.
5. Community wellbeing refers to people’s daily environment and whether or not they feel satisfied, connected and engaged with the areas in which they live.

Source: Rath, T & Harter, J: The Five Essential Elements of Well-Being, Gallup.com. Retrieved from https://www.gallup.com/workplace/237020/five-essential-elements.aspx

Excerpted from ‘Amplifying Wellbeing at Work and Beyond Through the Power of Recognition’, Gallup and Workhuman

Image credit | iStock