2022 was a challenging year in many ways. A lingering pandemic and record-shattering weather events combined with economic uncertainty to make it a year like no other.

It can be useful to reflect not only on what has happened last year but also on what lies ahead. Will 2023 bring more of the same? If so, how can we navigate the economic uncertainty we are experiencing - and how can organizations help their employees cope?

How Economic Uncertainty Affects Employees

Uncertainty is a fact of life. In some circumstances, we may be able to adapt or make changes to reduce it, but economic uncertainty usually arises from external factors over which we, as individuals, have little control. 

Things like inflation, rising interest rates, supply chain issues, global geopolitical turmoil, and the possibility of a recession can lead to feelings of anxiety and fear about what the future holds for us from several standpoints - including financial ones. 

For employees, economic uncertainty can cause fears that an organization’s growth might slow (or even reverse), leading to cutbacks. Employees may begin to question their career path and begin looking for a different position that is “safe,” or they may feel trapped doing work they find unrewarding.

This stress can impact both mental health and physical well-being, manifesting in a number of ways in the workplace, including:

  • Decreased productivity
  • Increased absenteeism
  • Higher turnover
  • Higher accident rates

Of course, the compounding effect of any of these outcomes cannot be overlooked. Decreased productivity or increased absenteeism can mean that other employees must pick up additional work, leading to increased stress for them, which can in turn lead to more absenteeism or turnover.

Additionally, a 2021 study published in the International Journal of Environmental Research and Public Health found that economic stress also negatively affects innovation. In a world where change happens quickly, many organizations suffer greatly if innovation is stymied.

Employers benefit from having a workforce that feels secure, so what can we do to combat the negative outcomes associated with economic uncertainty?

Company leaders have an opportunity to help employees feel more comfortable in their present situation and safer when looking at their future - even during challenging economic times. Acknowledging the importance and value of employees with recognition or rewards can help alleviate stress and provide other intangible benefits, sometimes at no or little cost.

“Just being recognized, appreciated, or thanked by a single leader is enough to increase the effort that people put into their weekly tasks by about 50%. When people feel valued, they add value.” Adam Grant, Organizational Psychologist and best selling author.

Rewards Vs Recognition: What's the Difference?

Though the two words are sometimes used interchangeably, HR professionals often consider rewards and recognition to be different ways of acknowledging employees. Rewards are typically financial (e.g., bonuses, salary increases), while recognition is more of an outward acknowledgement of appreciation. 

The two can produce different results, so organizations should consider their own longer-term goals as well as their employees’ needs before deciding on an approach for rewards and recognition. For example, rewards often work to improve employee morale in the short term but may have less of an impact on employees’ longer-term attitudes about the organization and their work. On the other hand, non-financial recognition can feel meaningless to employees who are feeling a great deal of anxiety about their own financial situation. 

Employee assistance programs can help employers develop and implement a strategy that will enhance employee satisfaction, leading to positive outcomes for both employee and employer.

Tips for Giving Recognition

To be meaningful, recognition must be authentic and meaningful. A certificate, shout-out, or a plaque that is not accompanied by genuine appreciation will ring hollow. 

5 tips for giving employee recognition

  1. be specific-clearly acknowledge the specific contribution that the individual (or team) made. "you are doing a great job," is much less meaningful than, "your extra work on the technical details of the client x project was key to launching the product on time."

  2. give recognition from management-Being recognized by a leader can be very impactful for employees. In fact, a recent Gallup survey showed that “the most memorable recognition comes most often from an employee's manager (28%), followed by a high-level leader or CEO (24%), and the manager's manager (12%).” 

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  3. understand the employee-You can increase the positive value of recognition by knowing your employee’s motivations and likes/dislikes. Something as simple as having the “right” person deliver the message can make a big difference. 

  4. consider how you deliver the message-It is helpful if you can understand how an employee might like to receive recognition. For example, some people prefer to be recognized privately rather than in a public setting. If you are sharing the recognition publicly, plan ahead for what you will say.

  5. provide opportunities for peer to peer recognition-Another potentially meaningful form of recognition can come from peers. Jessica Knight of Gartner notes that, “As work becomes more interdependent and managers have less direct visibility into the day-to-day of their teams, high-quality peer input has become an essential part of effective performance feedback.” Employers can develop a structure that allows and encourages employees to give kudos to others with whom they work.

Giving Rewards

Employee rewards can come in many shapes and sizes, from small one-time bonuses for a job well done to significant salary increases. For employers looking to maximize the positive impact of their rewards program, thinking creatively can lead to especially productive rewards programs.

4 non-traditional ideas for rewards

  1. give extra time off-providing employees with extra time off can be a valuable reward. as a reward, this should be different than "comp" time, which employees may view as simply trading time. to be effective, the reward must be something extra.

  2. offer branded gifts-judiciously!- so called Swag can be used as a reward if it is done with thought and care. Cheap keychains or pens can often just cause employees to roll their eyes, but they might appreciate something more meaningful, such as tech gear or clothing.

  3. think about gifts of services-employees often appreciate a gift of service that would be of benefit to them. for instance, an employer could reward a hard-working team with chair massages, or an individual who has demonstrated an interest in education could be given a free class of their choosing. in times of economic uncertainty, well-considered gifts of services can help employees feel appreciated and supported.

  4. reward with experiences- Experiential rewards can be a unique way of acknowledging your appreciation to employees. from vacations to tickets to a sporting event or music concert, experiences can be enjoyable and memorable. some experiences also offer extra value by including not just the employee but also their family, which can greatly improve overall satisfaction.

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Beyond Rewards and Recognition

Most employers understand that retaining valued employees can be challenging even in the best of times. During periods of economic uncertainty, it is especially important for employers to be diligent in ensuring that their employees know that they are appreciated.  

Rewards and recognition are just one facet of an effective plan to help employees cope with economic uncertainty and other stresses. Employers should also take proactive steps to help employees reduce anxiety of all kinds, by teaching them tactics to manage stress. And, of course, if an employee has self-identified or has exhibited signs of serious stress, you should refer them to professional help through your EAP.

When you partner with Ulliance, our Life Advisor Consultants are always just a phone call away to teach ways to enhance your work/life balance and increase your happiness. The Ulliance Life Advisor Employee Assistance Program can help employees and employers come closer to a state of total well-being.

Investing in the right EAP or Wellness Program to support your employees will help them and help you.  Visit https://ulliance.com/ or call 866-648-8326.

The Ulliance Employee Assistance Program can address the
following issues:

• Stress about work or job performance
• Crisis in the workplace
• Conflict resolution at work or in one’s personal life
• Marital or relationship problems
• Child or elder care concerns
• Financial worries
• Mental health problems
• Alcohol/substance abuse
• Grief
• Interpersonal conflicts


International Journal of Environmental Research and Public Health, Economic Stress at Work: Its Impact over Absenteeism and Innovation: https://www.sciencegate.app/document/10.3390/ijerph18105265

Adam Grant On Why You Should Rethink Your Work Strategies, The 360 Blog from Salesforce: https://www.salesforce.com/blog/work-strategies/

[Book] Surviving the Holidays Without You: Navigating Grief During Special Seasons (Good Grief Series), Gary Roe

Harvard Health Publishing

Employee Recognition: Low Cost, High Impact (Annamarie Mann and Nate Dvorak), Gallup,  https://www.gallup.com/workplace/236441/employee-recognition-low-cost-high-impact.aspx

Peer Feedback Boosts Employee Performance, Gartner,    https://www.gartner.com/smarterwithgartner/peer-feedback-boosts-employee-performance