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How recognition aids employee wellbeing

18th Oct 2022
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Employee wellbeing is no longer a ‘bonus’ or ‘nice to have’ for organisations aiming for significant growth and financial success – it is now an essential. With quiet quitting and disengagement running rampant, leaders need to take action and make wellbeing a priority in order to attract and retain talent – or risk feeling it on the bottom line. Neglecting wellbeing is one of the biggest – and most costly – mistakes organisations can make, with the cost of voluntary employee turnover due to burnout alone amounting to 15% to 20% of the payroll budget each year. Protecting and promoting employee wellbeing has never been more important – it increases engagement, productivity, inclusivity, and overall company loyalty, which is great for business.  

In Workhuman and Gallup’s latest report, Amplifying Wellbeing at Work and Beyond Through the Power of Recognition, the large-scale study of more than 12,000 employees across 12 countries found an undeniably strong connection between employee wellbeing and overall company growth and success.  

Sub-par employee wellbeing can have serious detrimental effects, from precipitating burnout and poor mental health to hindering employee productivity and engagement. It also comes with a costly price tag, with Gallup and Workhuman’s analysis finding that organisations can experience an opportunity loss of $20 million for every 10,000 workers due to low wellbeing and its drain on performance.  

The research also found the key to successful employee wellbeing was simple: recognition

The power of employee recognition  

Recognition is a straightforward solution that leaders – and employees themselves – can use to amplify wellbeing at work and beyond. Gallup and Workhuman found that high-quality recognition is strongly associated with lower rates of burnout. In addition, when employees are recognised at work, they are up to 10 times as likely to strongly agree they belong at their organisation. In the UK specifically, employees are 4.5 times as likely to strongly agree that they belong at their organisation when they strongly agree that recognition is an important part of workplace culture. 

But when employees lack a strong sense of belonging, they are up to 12 times as likely to be disengaged and five times as likely to be looking for another job.  

The study also found that recognising employees boosts their wellbeing in many aspects of their lives: 

  • Employees who strongly agree that recognition is an important part of their culture are up to 91% more likely to be thriving in their overall lives.  
  • Employees who have high-quality recognition experiences are up to 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. 
  • Employees who say they experienced a lot of gratitude the previous day are up to four times as likely to strongly agree that their organisation cares about their wellbeing.   

When incorporated strategically, recognition provides a foundation for employees to flourish. So, how can organisations make the most of recognition so that is supports and improves employee wellbeing, and business outcomes in the process? 

Building a culture of recognition  

In Gallup and Workhuman’s previous report on recognition, we found that there were five pillars of recognition that organisations should focus on. The pillars state that recognition should be: (1) fulfilling, (2) authentic, (3) equitable, (4) embedded in culture, and (5) personalised.   

Our new report identifies that building a culture of recognition is a particularly effective strategy to a successful recognition programme. A culture in which recognition is front-and-centre – where it’s a part of the everyday working experience – will see employee wellbeing holistically enriched. How can you build this recognition-strong culture? Ensure that employees are able to freely give and receive gratitude, praise and recognition for one another’s contributions to the company. Enable everyone, no matter their position in an organisation, to recognise anyone else – spreading recognition, and therefore wellbeing, far and wide.  

It's also important to ensure employees receive frequent, high-quality recognition. Gallup and Workhuman’s research found that employees who strongly agree they get the right amount of recognition for the work they do are up to 84% more likely to be thriving. In this recognition-rich environment, the ROI is clear – if employees are happy and healthy at work, if they are thriving, see room to grow at the company, and receive recognition that is fulfilling, then they’re more likely to want to stay.  

This loyalty is bolstered even further when leaders lead the way. When leaders set the tone for recognition, when they exemplify it themselves, employees not only know that their company cares about their wellbeing, but it also gives employees permission to do the same – creating an equitable culture of recognition where employee wellbeing is front of mind. 

It’s not just about celebrating and recognising people’s work-related contributions either. Freely celebrating life events too – from marriages to new babies to birthdays – makes employees feel seen as the unique human beings they are, giving that authentic and personalised recognition they expect and want.  
 

Recognition is a powerful tool for improving employee welling and business outcomes. Recognising employees for the work they do and for the unique humans they are is a strategic and simple way to not only show them you care, but to improve their all-round wellbeing. It also has the added benefit of helping to retain and attract talent by giving them the employee experience they expect and the one they deserve.  

 

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