How to Reward Young Employees When It’s Too Soon for a Raise

During the past few months, I’ve spoken with business leaders about their ambitious (and yes, young) employees who tend to expect a lot. Things like a promotion after a year (or earlier)! Or more money for simply doing a good job. These young employees also expect a lot of feedback and direction so they know exactly how to “get to that next step.”

I LOVE (truly love), these young, ambitious employees. Heck, previous managers likely thought of me as one at some point in my career. So, here’s the conundrum: How can you keep young employees engaged while also setting expectations around the realities of running a business, budgets, and financial gain? While I don’t think employers should reward employees for fulfilling basic job expectations, I do think it’s important to pay attention to employees and recognize the value they bring when warranted. This will not only increase engagement but will build a culture of trust and respect. And best of all, there are other ways to do it!

Let’s start with recognition. I believe how you make people feel, long outweighs what you give them. Likewise, when leaders recognize employees, it’s all about how the employee feels, and research backs this up. Researchers at the Wharton School of Business randomly divided university fundraisers into two groups. “One group made phone calls to solicit alumni donations in the same way they always had,” writes Harvard Health Publishing. “The second group . . . received a pep talk from the director of annual giving, who told the fundraisers she was grateful for their efforts.” The next week, the employees who were thanked by the director made 50% more calls than those who were not.

Whether you want to increase the productivity of your young employees or improve morale, saying ‘thanks’—and demonstrating your appreciation—can help you get there. Luckily, as Wharton’s study demonstrates, this doesn’t require a raise or bonus. In fact, contrary to popular belief, while monetary incentives are important, they’re rarely at the top of the list. In a recent report published by the Globoforce Work Human Research Institute, employees ranked compensation after, “I find the work meaningful,” and “I really enjoy the people I work with.” You can reward and inspire employees without giving them more money.

Nonmonetary Incentives That Young Employees Actually Want

Salary may be top-of-mind during the job negotiation, but studies show this doesn’t carry through. The number one reason people leave a company isn’t lack of compensation, it’s lack of opportunity to learn or develop skills (21%). LinkedIn’s 2018 Workplace Learning Report reports that, “94% of employees say they would stay at a company longer if it invested in their career development.”

Luckily, professional development is a nonmonetary incentive that’s mutually beneficial. It’s something employees want and it’s something companies value. Talent developers, executives, and managers agree that learning and development benefit the company. When you invest in your people, you invest in your business.

Although it’s difficult to measure exactly, you can estimate the ROI of professional development by calculating the financial impact of things like increased productivity, retention, recruitment, and job satisfaction, minus training costs. How can you provide professional development opportunities to your team? Here are four ideas.

Nonmonetary rewards like professional development opportunities positively impact employee engagement and loyalty.  “[Gen Z] wants the company they work for to help them maintain work-life balance as well as provide training and mentoring in addition to meaningful, challenging work,” writes Fast Company. Invest in your employees and make them feel appreciated.

Katie Stricker is the Co-Founder, President and Chief Coaching Officer of Sayge, a coaching platform dedicated to changing the way we work through “Coaching for the Rest of Us.” Sayge enables companies to attract, grow and retain the best employees by democratizing access to ICF-accredited, professional development coaches.

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