Incentive Magazine: New Study Explores Psychology of Employee Engagement

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Originally published in Incentive Magazine

Compensation and benefits don’t actually keep employees engaged. So suggests global engagement agency ITA Group, which finds only 15 percent of adult employees are engaged with their employers, although organizations globally invest $18 billion per year on tools to boost said engagement. To find the missing piece in the puzzle, ITA’s market-research subsidiary, Chadwick Martin Bailey, conducted a study into the psychological benefits that drive employee loyalty.

Published last week, the study of 1,500 full-time employees at U.S.-based companies found that there are five types of psychological benefits that drive employee engagement: functional, emotional, personal identity, social identity, and cultural identity. The latter three, collectively known as “identity benefits,” are especially important, found the study, which said companies that want to retain their best workers must “continually foster employees’ pride, self-esteem, and sense of belonging.”

Instead of motivating employees with external rewards exclusively, the study suggests that companies must also motivate employees with internal rewards.

“This is in line with what social science teaches us about the kinds of things that motivate behavior,” said Erica Carranza, Ph.D., vice president of consumer psychology at CMB and coauthor of the study. “Employees across tenure, level, and role are motivated by the psychological benefits we identified in this research — and the companies with programs in place to deliver these benefits will reap the rewards of a dedicated workforce.”

Added Christina Zurek, insights and strategy leader at ITA Group, “This research shows that companies can’t stop at benefits like compensation packages and work/life balance to truly inspire and engage their workforce. And while making a bigger push for wellness programs and similar initiatives can help, the most powerful investment a company can make in order to engage employees is to nurture emotional and identity benefits.”

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