Have you ever thought or said anything like this?: “There is no point in trying to engage our staff in their work unless we can afford to pay them more.”
I admit it, I have.
Turns out I was wrong about this. The truth is that money has nothing to do with employee engagement.
I have heard this statement many times: “I am tired of getting an employee trained, happy, and doing a good job only to see them leave.”
This statement is correct. Even highly engaged employees will leave your organization if the pay and benefits are too far from other comparable opportunities. The pay does not have to be at the top of the market to keep your staff, but it does have to be at least in the right ball park. If it isn’t, even happy employees will leave in order to better support their families and fund their own personal goals.
Basically, pay and benefits are important for employee retention, but less so for helping achieve high engagement. In other words, money will help retain all of your staff – the good and the bad – but it will not engage people further.
Why can’t you improve someone’s performance by paying them more? It turns out that if we get our minds focused too much on financial rewards, it narrows our focus too much and we truly can’t see the forest for the trees. We did an experiment with the IBEX Payroll team recently that verified this. It was tons of fun and it showed what happens when people get too focused on money.
We produced a video to summarize our hilarious experiment and its important results.