Do workplace perks increase employee engagement?

Many years ago, workplace perks were few and far between but these days, nearly every company offers some kind of perk for its employees. In order to stay competitive, recruit the best of the best and keep employees happy, it’s vital to consider not only what employees can do for you but also what you can do for them. It would be easy to say off the cuff that employees are more engaged when you give them bonus perks in addition to their normal compensation but it’s important to really look at if and why this is true.

The most important thing to remember when you offer perks is that freebies that make employees happy do not overshadow engagement – happiness and engagement are not one in the same. While it is true that perks can make employees happy and happy employees can be engaged, happiness is not the sole measure of engagement and therefore perks alone may not make more engaged employees. The power of perks lies in utilizing them in the right ways and finding how they fit into your company culture.

What the evidence shows

Time and time again, we see that the most important factors for satisfied employees are compensation, recognition, a positive relationship with their supervisors and autonomy to do their jobs. So where do perks fit in the mix when it comes to what’s important to employees? Well, many studies show that perks don’t rank very high – in some cases, not even in the top five or 10 considerations. However, these facts don’t necessarily show the whole picture. What they do show is that there are many things that must be fulfilled before employee engagement can be increased through perks. Company culture will always be more important than perks, but studies like MetLife’s 2013 Employee Benefits Trend Study show a connection between robust benefit offerings and engaged employees. So while it’s clear that perks have the possibility of increasing engagement, perks alone likely won’t.

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Which perks and why

In addition to understanding that perks are powerful in conjunction with a positive corporate culture, you’ll want to keep in mind that the type and nature of the perks make a difference. For instance, a perk that is expensive for the company and doesn’t make a significant impact on employees is not a good investment. There are also certain perks that resonate more than others. When you’re considering what to offer, look at what will improve employees’ lives and your company, either in the short or long term. For instance, gym memberships can positively impact the bottom line of your company’s insurance expenses as well as your employees’ day-to-day health. Additionally, an investment in your employees’ education or skills is one of the best decisions you can make. The difference in perks that make employees feel good and those that increase engagement is the value that employees see in the perk. That doesn’t necessarily mean it has to be big or costly, just valuable to the employees, such as concierge dry cleaning if your offices aren’t near a dry cleaner. While it’s always a good decision to do what is best for the company and the employee, don’t be afraid to have your workforce’s best interest at heart.

Have you seen engagement increase with the offering of new perks? Tell us about your company’s experience in the comments below.

Want to learn how to get your employees to be more engaged? Learn how to strengthen the link between pay and performance with this PayScale whitepaper.

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2 Comments on "Do workplace perks increase employee engagement?"

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Barbara Julian

I’ll be looking for incentives at wage levels as well as exempt beginners and long-timers. Thanks.

Jessica Miller-Merrell

Hi Barbara, 

There’s a great article I published on Payscale about different types of perks you can offer. These might be more general, but talk to your employees, if you’re a smaller company it might be easier to see what perks they want in their workplace. That’s the best way to gauge what everyone is looking for. You could survey different groups in your company if you’re wanting to break it down by type of worker.

Here’s a blog on some of the general perks that have worked for companies on a much broader scale.