Now that the American job market is fraught with layoffs but still rich in jobs, employers have an important decision to make: skimp on holiday bonuses due to the economic downturn or keep employees happy in a market with two job openings for every seeker. That's why Skynova surveyed over 1,800 employers and employees to understand the impact of holiday bonuses this year.
How do employees view their bonuses, and which industry's workers receive the most? We began our survey with these questions and more about holiday pay.
With record-level inflation eating away at grocery and gas budgets, many Americans will need a little extra help fulfilling their holiday wish lists this year. Overall, most employees surveyed are hopeful; 80% think they'll receive some extra holiday pay. Despite tech companies' large-scale downsizing, many employees in the industry (76%) hope to as well. And employers, take note: 67% of workers surveyed said they would consider leaving a company if they receive no bonus in 2022.
Of those who received 2021 holiday bonuses, food and hospitality workers saw the largest amounts, averaging $1,505. Other essential workers were the least likely to receive 2021 holiday bonuses, specifically those in education and health care. And although the teaching and health care workforces have struggled significantly in recent years, finance and insurance workers were 46% more likely than these employees to have received a holiday bonus in 2021.
If employees weren't going to receive bonuses, they preferred holiday parties (21%) to gift cards (19%). Team-building activities got just 1% of the vote. But unfortunately, 40% of employees who didn't receive a bonus in 2021 got nothing at all. This finding bodes ill for employee retention since 23% of workers who didn't get a holiday bonus last year said they're no longer with that employer. Meanwhile, 98% of employees who did receive one are still with their respective companies today. A yearly bonus and a daily check-in are also excellent tools to keep workers happy, productive, and loyal.
How do companies decide who is worthy of a bonus? You might expect someone's tenure at a company to equal a better chance at a big holiday payout, but that's not always the case. Next, we'll look at who's getting extra pay this season and why.
Right off the bat: bonuses work. Nearly every employer we surveyed who gave out bonuses (92%) said that both productivity and retention improved as a result. As for deciding which employees deserve to get one, managers most often considered employee performance (64%) and employee tenure (49%). Being a parent was less of a deciding factor, but fortunately for workers with kids, it was still one of the top three (41%) — just above their work quality (39%).
An employee's motivation level was also a factor, depending on the size of the business. Smaller ones were 4% more likely than medium-sized businesses to consider this when deciding who gets a bonus. With more income to spare, large businesses said they plan to give their contract and freelance workers the biggest bonuses this year — averages of $252 and $268, respectively. Medium and small companies planned to give theirs about $96 on average.
But even with more money to spend, large businesses were more likely than small ones to express fiscal anxiety over giving out bonuses in this economy. One in 10 employers said they aren't giving any bonuses in 2022, with 66% of them saying it was because of economic concerns. But if they couldn't give cash, many businesses found other ways to appreciate their employees, like pizza parties (48%) and gift cards (43%).
Higher productivity and retention are excellent reasons to show appreciation for employees in the form of a financial bonus. Every dollar is likely to come back to the business owner.
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We surveyed over 1,800 employers and employees to explore giving and receiving holiday bonuses.
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