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In plush times, people can be coy about money. Oh no, they say. I'm not motivated by cash [because I can pay my mortgage w/o a problem]. I'm motivated by values.

Then the recession hits and people get real --> fast. Gone are the cultural niceties and the polite [& fake] language of the boom cycle. The bust cycle prompts a more honest dialogue between employees and companies.

Frankly, it's refreshing.


Interesting take. So... tough times hit and people get real. Then, as things begin to turn and the people start considering their (new) options, their employers have to get real in order to retain and engage them.

I think it does, then, come back to cash being the foundation. If people don't believe their base package is fair, it doesn't really matter what other things you layer on top of that. Especially when they have other employment choices.

Good lesson for us in the reward profession. Thanks for sharing your perspective!

Honestly - I think employers are always out of touch with what employees need/want, recession or good times. I saw your list above - was that what employers perceived or what employees said? I think it's employers.

Honestly I'll trust the researchers at MIT on this one - they say not enough money can be a detractor but cash is only a motivator for mechanical/manual skills...not for cognitive skills/knowledge workers.

check out the video:


I think you're right, Ann - Cash looses it's incremental value at a certain point but after 3 years of no increases (for the lucky folks whose salaries weren't cut) and rising costs, cash is a crowd pleaser again.

Ann, In our compensation consulting work, we are called to evaluate and recommend revisions for an organization's dated or inequitable base pay system. With many of the additional non-cash rewards being tied to base pay by a percentage or multiple, we have heard employees and employers complain that the total compensation program is out of balance and losing its effectiveness as a motivator when the base pay program is no longer competitive in the market. We are advocates for a fair and competitive base pay system as the foundation in building a rewarding and lasting employer and employee relationship.

Ann I agree with your assessment as well as the comment from Blair Johanson. Having started my compensation career on the sales side, I've observed that employee's basic needs need to be met before they can offer mindshare to other things (such as their job). So in addition to Herzberg's hygiene factor I would also invoke Maslow's Hierarchy of Needs, except the hierarchy of needs is not a strictly linear path; people move up and down the hierarchy as circumstances change. Bringing this into the current environment I would say that employees were willing to be flexible given the severity of the recession, but have since become tired of it and long to return to a state of normalcy, hence pay becoming a more prominent factor once again.


In good times, when a rising tide lifts all boats, it's great to have a variable pay package that can lift your total income substantially. In lean times, when even your best efforts may not produce a respectable outcome due to circumstance beyond your control, a solid base pay package is worth more.

Its the classic bird in the hand vs. bird in the bush. The birds in the bush are more prone to take flight these days...

What a great discussion!

You're correct - this is a survey of employers, not employees. Certainly always best to get it from the horse's mouth, so to speak - but still interesting to hear the perspective from the employer side of the table. As for the Drive/Dan Pink link ... I think we've probably said it all (ad nauseum)in earlier posts and comments (on this blog and others), so I'll just let that topic rest.

Yes. It IS a sign of the times, isn't it?

Sounds like we are in agreement. Unless the foundation is a strong one, moving forward to pile on (or link) other programs and rewards to it is not going to be well received.

Good points - no matter the theory, basic needs must be met before frills will be seen as having much "currency".

The birds may indeed be getting itchy ... and perhaps that is what these surveyed employers are acknowledging.

Thanks - all - for your comments and thoughts here!

This is a great discussion.

I believe any employer who believes that motivation/rewards can be reduced to any single factor would be, at best, fooling themselves. The most engaged employees are going to be those who understand both current and future paths of the organization and their role along that timeline. Their role has to be identified and rewarded by financial and non-financial terms alike. The financial piece is easy, it's the commodity of reward systems. The employers most successful at driving employee engagement will be those who wrap the commodity of the financial reward with the non-financial, customized incentives most valued by each employee.

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About The Author

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    Compensation consultant Ann Bares is the Managing Partner of Altura Consulting Group. Ann has more than 20 years of experience consulting with organizations in the areas of compensation and performance management.

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