Maybe Work Engagement is Also Tied to Pay?
In April, at the Brookings Institute in Washington, two economists from Wharton, Betsey Stevenson and Justin Wolfers addressed the age-old question of what money can and can’t buy. Drawing on a wide range of surveys, the economists claimed that rich people are far happier than poor people, rich countries are happier than poor countries and as countries get richer they get happier.
Why all the fuss? These findings run counter to a large body of evidence that suggests that especially in rich countries, economic growth has failed to translate into greater subjective well-being.
There findings suggest that “economic growth is a very powerful force for raising well-being. It is not true that only income matters, but on average it looks like economic growth is good for happiness, even in rich countries.”
The article goes on to say – that as people and countries grow richer, each extra dollar of income buys less and less additional happiness.
I think these economists are onto something very interesting, especially when it comes to the work environment and employee engagement.
The other day we were pitching a client on our new employee engagement program. They loved the program and what it could tell them about how engaged each of their employees are with the work environment. But, what did they ask us to pull out of the program? That’s right the measure on remuneration. Why? Because they claimed that they have no room to improve any dissatisfaction related to this particular measure. Interesting, these are the lowest paid employees in the company. These are the people making minimum wage struggling to survive.
Thinking about it – wouldn’t we expect that these low wage earners would be happier if they weren’t forced to worry about money and whether or not they would continue to earn enough to feed and clothe their families….
I think the answer would be a definite yes. Maybe, we also need these economists to test some of the theories related to remuneration and happiness in the work place as well…..
Comments
In general, I think tat if there's a sense that the spills are not spread fairly, this will certainly negatively affect motivation.
At the bottom, things like financial worries, jumping through hoops for small financial benefits (unrelated to work), bad sleep, bad nutrition, etc can all cause disengagement on top of that.
I think facilitating people to be able to fully focus on their work should be a top priority. Asking for focus when this is not possible only leads to unattainable expectations for management and stress for the worker.
I think the macro-findings from these Economists don't really tell us anything about this specifically. The main question is what would happen if you'd vary individual pay. In fact, I think the whole research is more or less useless because as far as I know it doesn't control for many measurable and unmeasurable correlates of income per capita, such as education, infrastructure, health care, etc. The research is showing us nothing new. Life is better in rich countries. The question is WHY. For that, you need micro-observations. Measuring employee happiness in response to pay increases over time would be a good way, which might be done far too little.
Another interesting question might be: Would employee engagement improve more with cash benefits or things like health insurance and child care. How about actually caring for employees, investing in them through free education programs, or stepping in in times of hardship in the family? Pay increase is only one way to make a worker feel more valued.
Posted by: Meryn Stol | June 16, 2008 09:27 AM