Does Money Play a Role in Employees’ Motivation?
And is it the sole motivator?
If I told you to work without getting any money in return, would you be up for it? Of course, not! Even I wouldn’t take up that offer no matter how much I love my work. This means that money is indeed an effective and very powerful motivator for employees. Money keeps an employee motivated and extra money keeps them extra motivated.
There are exactly three stances on the subject of money as a motivator for employees. Let’s have a brief discussion of them:
In Favor of Money as a Motivator
It is in human nature to compete. And when they get money in return for their services than their productivity levels, as well as standards, are raised for everything. But not every employee can always be promoted, and it is also not a wise choice to keep promoting them without any performance, so money can be used as compensation to reward all employees, equally. And because money is a common incentive, it is always acceptable to everyone, at all times. Money talks and it can get the work done anywhere and at any time of the day.
Against the Concept of Money as a Motivator
Another way of looking at money as a motivator is that it is highly ineffective and can demotivate an employee. Money can make your work/workspace more complex. How? Let’s have a look at the types of motivation for this one. There are two types of motivation:
- Intrinsic motivation
Intrinsic motivation is the type that makes you want to do things for your sake and personal rewards. For example, you exercise because it’s good for your physical health.
2. Extrinsic motivation
Extrinsic motivation means performing an activity for the sake of external factors or awards. For instance, you exercise to win an award or a title.
When I said that it makes your workspace more complex, I meant that employees become extrinsically motivated rather than being intrinsically motivated. If money works as motivation then perhaps the base salaries of all employees are way less than they should be. And, of course, there are much better methods to keep an employee motivated; appreciation and acknowledgment, for example.
We shouldn’t be gullible enough to believe that if our salaries are increased, so will be our productivity levels.
A Middle Ground
You believe that money only sometimes motivates an employee and not always. For example, I have coworkers who are at managerial positions and are being paid well yet still their level of motivation is not as much as is expected of them. This makes me think that you cannot measure an employee’s dedication and performance based on the number of bills transferred into their accounts, every month.
In a worst-case scenario, money can even pit employees against each other which can lead to a chaotic work environment and an evident lack of teamwork.
Now that I have laid out all the possible stances, I am sure you now know where you stand on this matter.
I am a person who believes that money can and cannot act as a motivator. This is because there are a lot of other contributing factors that can motivate a worker to perform better. For example, I quit my previous job not because of money but because of the lack of acknowledgment and respect.
Let’s have a look at a few other factors that can impact an employee’s motivation:
1. A Positive Work Environment
A positive work environment plays a significant role in employees’ motivation because when they feel happy at work and have a sense of belonging then it can drive them to produce the company’s desired outcomes.
A company’s culture can be improved if they care about the mental and physical well-being of their employees and are compassionate and empathetic towards them. Also, a company that favors diversity, equality, and includes everyone can stand out from all the other companies and attract the best of talents.
2. Being Acknowledged
Employees of every level must be acknowledged and regarded for their hard work and contributions to the company. Their achievements, no matter how big or small they are, should be valued and recognized. Because it is natural for human beings to want other people to recognize their efforts. It helps them establish a strong mental connection between them and the company.
Now recognition also comes in many forms and I believe that it also depends on each individual. You can receive an incentive in the form of money or your efforts can be recognized in front of your teammates, which has a higher chance of increasing your motivation.
3. Finding Purpose in Your Work
Nowadays, employees are better motivated to work when they can find meaning as well as purpose in their professional lives. Simply put, they want to know that their work and contributions are somehow making a difference out there. I was recently reading a study that reported that quite a decent number of people would be willing to earn less money if what they do is meaningful.
4. Learning and Growth
If an employer is willing to invest in his employees by presenting to them a variety of opportunities to learn and grow within their workplace then this can also be quite a motivating factor for an employee to continue working for that company.
For example, if your boss hires a trainer to upgrade your skillset and make you learn about many other relevant skills that can prove to be useful for you, in the future or present, then you will develop a sense of professional growth. Investing time in your resources can make them feel valued and recognized.
5. A Clear Vision for the Employees
Employers should have a clearly defined vision not only for the companies but also for the employees to let an employee know that they will not be forever stuck in only one position. Many people quit their jobs because they are unsatisfied with the senior management and sometimes the company culture. So, it is important to know your employee’s aspirations and goals to provide them with a proper career ladder that can keep them motivated to earn the rewards for their future.
I would like to conclude this article by saying that an employer does not always need money to keep an employee motivated and retained. In reality, there are a variety of motivators, some of them which I have stated above, that an employer should be mindful of. Money does play a pivotal role in motivating employees but it is not the sole motivator to keep them going.