SMEs that reward employees boost motivation and retention

Nearly all SMEs give their employees rewards, according to a new report, and more than half of those do so to improve employee engagement and motivation.

A survey by American Express found that 94 per cent of small businesses gift rewards to their staff, with 51 per cent saying they do so to motivate their workers.

Meanwhile, 34 per cent said that a culture of rewards has improved employee retention.

There was some variation in how SMEs go about rewarding their staff. 38 per cent focus on high-performing employees, while 23 per cent make rewards available to all workers and 21 per cent focus on long-serving members of their teams.

89 per cent of SME employees said they had received some kind of reward, and the report showed that workers value this approach from their employers.

46 per cent said rewards made them feel valued, while 44 per cent said they felt their companies were rewarding their hard work when they received gifts. A third even said that following receipt of a reward they felt motivated to work harder.

“SMEs are reaping the benefits of actively showing employees appreciation for their hard work,” said Jose Carvalho, senior vice-president at American Express.

SME Publications/ SME XPO 2024

“A simple thank you goes a long way and will not only make employees feel good, but will benefit a business in the process. Our study also shows that a number of SMEs are gifting rewards accrued through spending on a credit card, such as high street vouchers.”

Even of the six per cent of employees who do not receive rewards, 42 per cent said they think staff members receiving rewards is a positive thing, while 37 per cent said they believe they would be motivated to work harder if they received rewards.

The report’s authors advised SMEs to go beyond just giving rewards to personally congratulate employees, choose the right moments to give them and allow workers to put their ideas forward as to what the rewards should be.

Photo © belchonock / 123RF Stock Photo

SME Publications/ SME XPO 2024