You may have a handle on the demographics of the employees you’re incentivizing with group travel, merchandise, or other rewards, but are you looking five years down the road? Will your younger employees be motivated by the same things as today’s winners?
According to the Incentive Research Foundation, the answer is “unlikely.” And shifting strategies around incentives for younger workers is among the top industry issues covered in the IRF’s recently released 2024 Trends Report.
By 2025, Baby Boomers are expected to be less than a third of the workforce, with those under 45 (Millennials and Generation Z) making up about 60 percent. Broadly speaking, Boomers are more inclined to equate work to self-worth and long-term financial security. Gen X and Millennials, on the other hand, tend to value flexibility, options, and professional-development opportunities at work.
For today’s early-career workers who may “job-hop” more than employees in past generations, incentives can be an important retention tool, and the IRF has found that “younger workers place a high value on frequent, authentic recognition.” As a result, using points, gift cards, and spiffs (short-term sales bonuses) are effective because they create an opportunity for touchpoints throughout the year.
Technology is another way to provide ongoing feedback and deliver rewards quickly, and incentive-program organizers have taken note. According to the IRF report, 53 percent of third parties are increasing their spending on incentive-program technology in 2024.
Finally, the IRF reports that younger workers are drawn to merchandise rewards, such as electronics, and experience rewards, such as concerts. They are also “more likely than others to prefer incentive-group travel, and those who have experienced incentive-group travel are significantly more likely to prefer it as a reward choice.”
IRF’s 2024 Trends Report focuses on three additional topics: the pressure on incentive programs from rising costs and inflation; the strain on the buyer-supplier relationship caused by staffing shortages, price increases, and service levels; and the increasing importance of incentives to motivate workers. The report, available here, will be discussed on a IRF webinar on Thursday, February 15, featuring Susan Adams, vice president, engagement strategy & corporate services at Next Level Performance; Rudy Garza, vice president, operations at Brightspot Incentives & Events; and Andy Schwarz, vice president, content and communications at IRF.