Employee Appreciation Day, celebrated on the first Friday of March, is an opportunity for organizations to thank their employees for their accomplishments and contributions. However, while a single day of appreciation is a nice gesture, true recognition must be built into the everyday culture of an organization. When it’s done well, it also has a significant impact on outcomes important to both individual employees and the organizations for which they work.
The Origins of Employee Appreciation Day
Employee Appreciation Day was founded in 1995 by Dr. Bob Nelson, a recognition consultant and author who has spent decades researching and promoting the power of employee recognition. His work, including 1001 Ways to Reward Employees, emphasizes that appreciation isn’t just about perks or financial incentives. It’s about creating an environment where employees feel valued, appreciated, and motivated to keep doing their best work.
Dr. Nelson’s research isn’t isolated. Recognition consistently ranks among the critical drivers of employee engagement, productivity, well-being, and retention. It’s so important that it’s one of 10 core factors of the employee experience, as measured by Perceptyx’s People Insights Model. Yet, despite its well-documented benefits, many organizations still struggle to make recognition a consistent and meaningful practice. Employee Appreciation Day was created as a reminder, but organizations should work year-round to instill an intentional culture of appreciation.
Better than a Raise? Research Says Yes.
While it goes without saying that fair and equitable compensation is important to a positive employee experience, for employees, feeling valued is about much more than money. New research from The Center for Workforce Transformation demonstrates this.
Our December 2024 study of more than 3,000 workers showed that about 2 in 3 feel valued by their organizations, and about the same say they are regularly recognized for doing a great job. This data showed dramatic differences in employee and organizational outcomes like engagement, job-seeking behaviors, and employee well-being when recognized employees are compared with those who disagree with these items.
Researchers also looked at the relationship between employee experience outcomes and raises during that same time. Employees receiving a raise in pay in the preceding three months reported only small differences in these same outcomes, and in some cases, workers receiving a raise actually had slightly worse outcomes than employees who did not.
- Well-recognized employees were 7x more likely to be fully engaged in their jobs than employees who were not recognized. In contrast, employees receiving a recent raise were only 30% more likely to be engaged than those who did not.
- Employees not receiving a recent raise were slightly more likely to have engaged in job-seeking behaviors, such as browsing ads or applying for a new role, than those who had a raise (61% vs. 54%). This number jumps up to nearly 75% for employees without regular recognition.
- Recognized workers are less than half as likely to report decreased productivity due to workplace stress than their less-recognized counterparts. Once again, those receiving recent raises are worse off, reporting greater disruptions in productivity due to workplace stress.
This underscores that while rewards are important to the overall workplace experience, they aren’t enough to keep employees engaged and employed and stave off burnout. In addition to good compensation, employers should focus on everyday recognition for excellent work and ensuring that top talent knows the value they bring toward achieving company goals.
The First Step: Build a Culture of Regular Appreciation
Employees want to feel valued and recognized, and not just on Employee Appreciation Day. While most organizations understand the importance of rewarding their employees, they over-index on formal programs and forget that it needs to happen regularly and informally as well. But all recognition isn’t created equal — our team of behavioral scientists say to be sure your recognition follows the STEP acronym:
- Specific: A vague "good job" doesn’t carry the same weight as acknowledging exactly what someone did well and how it contributed to the team or company goals.
- Timely: The closer the recognition is to the action being recognized, the more meaningful it is.
- Earned: Recognition should be based on actual accomplishments and behaviors that align with organizational values.
- Personalized: Different employees may appreciate recognition in different ways — learn what employees find meaningful and do that.
Recognizing employees and celebrating their hard work should be an integral part of your organizational strategy and should be supported by leaders, especially given the bottom-line implications.
Measuring the Impact of Recognition Through Listening
We’ve all heard the adage, “What gets measured, gets managed,” and recognition is no exception. According to the Society for Human Resources Management (SHRM), companies spend around 1% of their payroll budget on recognition programs. But, do they have the desired effect? Are there pockets of the organization where people feel more valued than others? We need to ask our employees, and then act on what they tell us to ensure that our recognition programs are working and worth our investment.
Possible listening event ideas for recognition include:
- 1:1 Meetings with Employees: Ask employees about the best recognition they’ve ever received. Pay attention to the who (who was it from?), the how (was it private or in public?), and the what (was it an award or a thank you card?). Tailoring recognition to the employee is important for ensuring it lands.
- Specialized Recognition Pulse: Ask a one-time special survey to help organizations understand employee needs when it comes to recognition or measure the effectiveness of specific recognition programs.
- Planned EX Survey: Ask about recognition on regularly planned surveys to measure the overall experience with recognition for employees. Do they feel valued? Are they regularly recognized for exceptional work? Connect these sentiments with other things measured on the survey, such as intent to stay, manager relationships, or well-being.
- Exit Survey: Ask departing employees’ perceptions about recognition and appreciation during their employment to uncover patterns and target actions for improving retention by improving recognition.
Disengagement & Recognition: A Gap for Frontline Workers
In our recent report, The Forgotten Frontline: Closing the Gap in Engagement Support, we identified a critical area that deserves special attention in any organization's recognition strategy. Frontline workers — those who directly represent your brand to customers — often experience recognition differently than their deskbound colleagues. As you develop your listening and recognition programs, we recommend paying particular attention to this often-overlooked segment of your workforce.
Our research reveals that frontline workers feel significantly underappreciated compared to their deskbound colleagues, with stark implications for engagement and retention. While 46% of desk workers report being fully engaged, frontline workers lag at 43%, with only 34% feeling they truly belong at their organization compared to 43% of deskbound employees. Recognition disparities are evident — 66% of desk workers feel their accomplishments are recognized versus just 58% of frontline staff.
Customer-facing frontline workers face additional challenges, with 48% requiring manager intervention with difficult customers, and only 58% believing their contributions are equally valued compared to 68% of desk workers who believe contributions are valued equally. This recognition gap drives a concerning cycle where more than 1 in 4 frontline workers have considered leaving due to difficult customer interactions.
Organizations must address these challenges by delivering specific, meaningful recognition tied to frontline employees' unique contributions. Managers, as the closest point of contact for frontline teams, should provide timely recognition while fostering an inclusive culture where frontline workers feel valued and heard. By prioritizing frontline employee input on decisions affecting their work and listening before implementing policies, companies can create a more engaged workforce across all levels — ultimately improving retention, productivity, and customer experiences.
From One Day to Every Day, Create a Recognition Culture that Fuels Results
The data is clear: meaningful recognition drives engagement, retention, and productivity in ways that even compensation increases cannot match. Don't wait for next year's Employee Appreciation Day to show your team they matter. Start building a year-round culture of meaningful recognition today — where the contributions of every employee, from the C-suite to the frontline, are truly seen, acknowledged, and celebrated.
Schedule a meeting with Perceptyx to discover how our tailored listening and people analytics solutions can help transform your recognition culture and drive the outcomes that matter most to your organization.
For more data-driven EX insights like this, subscribe to our blog.