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Beyond Pay: Intrinsic Rewards and Workplace Motivation

intrinsic rewards

intrinsic rewardsPreviously we’ve talked about benefits and how to pay or otherwise reward technicians in order to attract the best talent and the most responsible employees. In this blog we will discuss extrinsic vs. intrinsic rewards and why employers, job recruiters, and employees are focusing on the intrinsic rewards jobs have – especially Millennial workers.

What Are Intrinsic Rewards?

Intrinsic means internal, and intrinsic rewards are rewards that are generated from the process of doing the work itself. Intrinsic rewards are outside the usual, “Plow this field and I will pay you a hundred dollars” model of pay for work.

Extrinsic rewards are the tangible benefits we all associate with paid work: pay rate or salary, benefits, and bonuses. So much of the paid work of earlier eras was mentally unstimulating. Hardly anyone enjoys digging ditches or doing line work, especially when they’re doing it for a third party. People would never do it without pay. Extrinsic means “external.” It’s summed up as, “If you do this work, you get that reward.” The reward itself is unrelated to the process of doing the work.

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Intrinsic rewards are related to the process of doing the work. They flow from the work. In other words, intrinsic rewards are the satisfaction or enjoyment you get from doing the job in addition to whatever money you receive for doing it. Many people will do a more enjoyable job for less money because they like doing it. In fact, plenty of people will do certain kinds of work for no money at all because they love it so much. People have painted paintings, written poems, or composed songs for centuries under this model. Art rarely pays, but people will always create art out of love for it.

Why Are Employers Focusing on Intrinsic Rewards Now?

There are two big reasons for the focus people in the workplace are giving intrinsic rewards now. The first is that there’s less money sloshing around now. Post-Great Recession, the economy is better, but many of the full-time, full-benefit jobs of the past are gone for good. Companies can’t afford to pay what they once did. The United States must compete with a global marketplace, and that has depressed wages. Much of the repetitive, back-breaking work of the past is also gone, either offshored or automated. That means that many jobs exist that would have at least some intrinsic rewards for workers – if a company can locate and hire the right ones.

The second reason is that younger workers have different expectations of their work than their parents did. Many more Millennials want work that is “meaningful.” This is likely the result of teachers and administrators telling children repeatedly that they should do what they love “and the money will come.” Millennials want to feel satisfaction in their jobs. They want to learn new skills and find mentors. Pay is still important, but intrinsic rewards factor in far more than they used to. Perhaps this is because Americans are not in danger of starving to death any longer. The threat of hunger or eviction onto the street was the reason so many people were willing to work long hours doing piece work or digging in the mines. It might also have something to do with the fact that many Millennials have so much student debt that they can’t make future plans very easily. They want to be happy in what they’re doing now. If they’re not happy, they will leave. They don’t have five children they have to feed to keep them on the job.

The Ivey Business Journal identified four intrinsic rewards that drive employee engagement. These are:

  1. A sense of meaningfulness
  2. A sense of choice
  3. A sense of competence
  4. A sense of progress

It’s easy to see how employees who have the above would be more likely to be satisfied, long-term workers who act as recruiters for their companies. Next time we will explore these four rewards in more detail and talk about how they relate to the auto repair industry specifically.