Generation Z and Millennials Seek Recognition at Work

Behavioral science insights and interactive tech help deliver kudos

Stephen Miller, CEBS By Stephen Miller, CEBS September 12, 2019
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Generation Z and Millennial employees are much more likely to feel dissatisfied at work and seek better experiences elsewhere, a national study of adults ages 18 to 38 finds. Close to half (43 percent) of Millennials and 78 percent of the youngest workers surveyed—Generation Z—plan to leave their job within the next two years.

Researchers interviewed 632 people for the survey in April 2019. It was sponsored by daVinci Payments, a payroll technology firm.

The study found that giving financial recognition to the two youngest generations at work, even in small ways, provides these workers with a greater sense of personal fulfillment and helps boost employee retention.

Additional findings from the study include:

  • 79 percent said that an increase in recognition rewards would make them more loyal to their employer.
  • 76 percent believe they are "seldom to never" eligible for employee rewards.
  • 75 percent said they would use a substantial employee performance reward for everyday or emergency needs, compared to only 22 percent who would use the same reward for a unique experience.
  • 50 percent feel that management does not recognize strong job performance.

"The vast majority of young workers in the U.S. are feeling a strong level of dissatisfaction with their employers, resulting in an urge to seek more rewarding and validating work outside of their current organizations," said Rodney Mason, daVinci's chief revenue officer. "While some employers may see these young workers as disloyal or unmotivated, the truth is that they can be turned into an organization's most enthusiastic and valuable resource when shown appreciation for their work and rewarded in the right way."

Younger generations' willingness to stay at their current jobs when given even small rewards—which most dedicate to common living expenses—indicates that Millennial and Generation Z employees are shouldering increased financial burden, Mason said.

Although the U.S. unemployment rate sits at its lowest point in decades, employee pay growth has stayed restrained, leaving many young employees struggling with everyday costs on top of having to manage additional expenses like rising student loan payments, he noted.

Using Behavioral Science

Maritz Employee Experience, which creates employee engagement and recognition programs for U.S. and global companies, advises using behavioral science as the basis of employee recognition programs. For instance, employers can put in place recognition programs that emphasize these factors:

  • Shared identity by connecting the employee experience to the company's purpose and values, instilling a sense of belonging and inspiring commitment and support.
  • Social rewards that deliver on the desire for connections with others, activating positive emotions in the brain in the same way a cash gift would.
  • Progress feedback that communicates progress on meaningful work, contributing to satisfaction and maintaining momentum and motivation.

"There's certainly an art to creating and maintaining successful employee recognition programs," said Chris Dornfeld, vice president and general manager of Maritz. "Companies that take this approach find that they are able to avoid costly employee replacements while building a culture of learning, recognition and ambition."

[SHRM members-only toolkit: Managing Employee Recognition Programs]

Deploying the Intranet

Many companies are beginning to use their intranet as a home for employee recognition, according to Casey Farr, a communications executive at Unily, a U.K-based provider of digital workplace applications.

"Modern intranet platforms include a host of features that can be leveraged to show appreciation for employees," she noted. For example:

  • Blogs can spotlight employee achievements.
  • Third-party apps can be integrated with the intranet to make access easier when a company already has an established method for recognition.

Intranets can promote peer-to-peer recognition—digital pats on the back that can be as effective as small financial rewards, Farr noted. For example, Ellie Mae, a cloud-based platform provider for the mortgage finance industry, added a Cheers for Peers recognition widget to its intranet platform.

"An important goal for the intranet was to encourage more peer-to-peer interaction, supporting a culture of engagement and sharing," according to an Unily case study, which noted that "Ellie Mae's Cheers for Peers widget [provides] a way for staff to say a thank you for the help or impact a colleague made on a project."

Cheers for Peers had over 400 submissions in the first two months after its 2017 launch, representing participation by a quarter of the company's 1,600 employees. Last year, the feature received an intranet award from employee communications firm Ragan.

"You say 'thank you' to somebody, and if you take that extra effort and go to the home page and give somebody a shout-out, it's like you're putting your money where your mouth is," said Sara Holtz, senior manager for internal communications at Ellie Mae, writing in Unily's case study. "People really appreciate having that avenue."

Related SHRM Articles:

Put Recognition in Your Employees' Hands, SHRM Online, October 2018

Using Recognition and Other Workplace Efforts to Engage Employees, SHRM Research, January 2018

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