Do employees care about money, such as salaries and wages? The answer is both a yes and a no. Today, we’re going to explore why workers need it and why they also demand more than just compensation in the workplace.
Why Money Matters
Ever since the ancient Babylonians created guidelines for using money, cash and its other forms have become an essential part of everyday life. That is especially true for the millions of workers in the United States.
In a 2018 Salary.com survey, over 65% said they’re leaving their jobs because of insufficient salary. It means the wages they receive do not match the type of work they’re doing. Taking the second position is the lack of bonuses and end-of-year raises. About 29% actively sought greener pastures because of this.
Why does money matter to employees?
1. The Lack of It Can Be a Significant Stressor
In a 2019 Gallup poll, Americans rose as the most stressed people in the world. Over half of the respondents said they experienced stress often during the day compared to 35% globally. When they looked deeper into the possible reasons, the researchers discovered a correlation between negative experiences and feelings and low income.
2. Money Is a Basic Need
Based on Abraham Maslow’s hierarchy of needs, for a person to achieve self-actualization, which is the highest level, they need to fulfill their lower-level needs first. At the bottom of the pyramid are necessities, such as food, education, and shelter.
All these will be difficult to achieve when one doesn’t have cash. It also suggests that if an employee cannot satisfy their most basic need, then they couldn’t attain a sense of belongingness and security, among others.
But Money Isn’t Everything
If money is essential for employees, then why are they still leaving companies despite their fat paychecks? Why should businesses consider using employee experience software to track feedback? The answer to both questions is simple: Money isn’t everything.
In 2010, the Woodrow Wilson School of Princeton University revealed a correlation between happiness and income. Feelings of happiness could increase as wages rose.
However, it has limits – $75,000, to be exact. Earning beyond this doesn’t boost your sense of happiness and contentment.
Maslow’s theory can also apply to this area. When their wages are sufficient for their essentials (and they live comfortably), then their needs change. This explains why workers will start looking for the following:
- Recognition and appreciation in the workplace
- More diverse roles or job challenges
- Career opportunities
- Training
- Strong leadership
- Teamwork
- Job satisfaction and fulfillment
- Purpose
Importance of Feedback
Your workers are one of your precious company assets. If they’re productive and effective, you should keep them for as long as you can. After all, turnover rates can be too costly.
But how? You need to marry compensation with other factors employees look for in their workplace. Besides giving them the right compensation, provide them avenues for growth and engagement. Create a safe workplace for everyone.
As needs can vary between individuals or groups, use employee feedback to help you. You can use the information to create programs or map career paths, for instance.
Money matters – to a certain extent. It’s only when employees feel they belong, they are heard, and that they can still contribute something worthwhile that they decide to stay.
