Gallup-Workhuman study finds organisations can save more than $16M annually by having culture of recognition

In the midst of the Great Resignation, when employers are looking for ways to retain their employees, the importance of human capital has never been clearer. Recognising employees is a simple way organisations can demonstrate their investment and commitment to their employees and inspire them to feel connected, confident and cared about — ensuring they leverage the full force of their human power at work. However, a new research report published today by Gallup and Workhuman, Unleashing the Human Element at Work: Transforming Workplaces Through Recognition, reveals that currently, only about one-third of employees say their employer has a formal recognition programme.

Eight in 10 senior leaders (81%) say recognition is a not major strategic priority for their organisation, meaning many organisations are missing out on achieving organisational benefits by not prioritising recognition. Gallup’s analysis of the study data shows that an organisation of 10,000 people with an already engaged workforce can save up to $16.1M in employee turnover annually when they make recognition an important part of their culture.

But not all recognition is created equal. Gallup and Workhuman partnered to study employees across the United States, the United Kingdom and Ireland to understand what recognition means to them, whether they feel they are receiving it authentically, equitably and frequently enough, and what effect good recognition has on their attitudes toward work and life. The study found that more than half of employees who say the recognition they receive at work is not authentic (53%) or equitable (52%) are actively looking or watching for new employment opportunities. Two in five employees (40%) say they are not receiving enough recognition from leaders at their organisation — only a few times a year at most — when the bare minimum for positive impact is at least a few times a month. Additionally, the findings show how recognition can drive real impact for a workforce, as those who receive the level of recognition that matches their needs and expectations are:

• 56% less likely to be looking or watching for job opportunities
• 4x as likely to be engaged
• 3x as likely to feel loyal to their organisation
• 4x as likely to strongly agree they would recommend their organisation as a great place to work
• 4x as likely to feel that they belong at their organisation
• 5x as likely to see a path to grow at their organisation

A culture of recognition, at its most basic level, is one in which gratitude, praise and appreciation are freely given and regularly received in an authentic and equitable way throughout the organisation. “Since Gallup began tracking employee engagement in 2000, we have understood that recognising

employees is a key component to creating an engaging culture at work,” said Ed O’Boyle, Gallup’s global practice leader. “The findings from Workhuman and Gallup dive deeper into quantifying not only the financial benefits of strong recognition programmes, but also intangible benefits like improving worker wellbeing and developing brand ambassadors.”

Employee recognition doesn’t just have an impact on work performance, it affects a person’s viewpoint of life. Recognition has an insulating effect that can help shield employees from burnout and support their overall wellbeing. More than 70% of employees who have good recognition experiences at work rate their lives more positively overall and are more likely to be “thriving” in their everyday lives compared to those who are not being fully recognised.

However, recognition is not a one-way street. When organisations make a point of celebrating employees’ successes and contributions, those employees pay it forward and become brand ambassadors who help spread the word about their workplace. In today’s competitive talent marketplace, the power of employee referrals cannot be understated. Yet, only 28% of employees in this study strongly agree they would recommend their organisation as a great place to work.

Organisations that acknowledge employees through strong cultures of recognition can boost this figure to 68%.

“The Gallup data clearly shows that when recognition is truly embedded in workplace culture, people feel its full impact — they feel seen and valued, motivated to put in a little extra, and supported to reach their full potential,” said Chris French, Workhuman EVP. “In today’s world of distributed and hybrid work, keeping employees connected and engaged is a major business priority. By implementing and nurturing a strong and strategic recognition programme, many problems organisations face could be overcome. Recognition is no longer a nice-to-have programme, but rather a business imperative.”

To read the full report, Unleashing the Human Element at Work: Transforming Workplaces Through Recognition, please visit: https://www.gallup.com/analytics/392540/unleashing-recognition-at-work.aspx. For information on Workhuman, visit www.workhuman.com, and on Gallup, visit https://www.gallup.com/analytics/318665/public-sector-reports.aspx.