As rates of employee motivation and recognition have dropped for the third year in a row, HR leaders should establish continuous feedback, reduce bias in performance reviews, and address key challenges to get their workforce back on track.
By Maggie Mancini
Economic uncertainty, rising costs of living, return-to-office mandates, or political polarization, there is no shortage of headline-grabbing reasons why today’s workforce is less motivated than their predecessors. But the impact of this decline is significant: highly motivated employees contribute to 21% greater profitability for their organization. While employees remain committed to the value of their work, their motivation to go above and beyond has dropped for a third year in a row, according to recent benchmark data from Culture Amp.
The reason? In many cases, it comes down to employees’ trust and confidence in company leadership. Fresia Jackson, director of people science research at Culture Amp, explains that the three top drivers of motivation include employees knowing they can develop at their current company, having leaders who communicate a motivating vision, and feeling confident in the leadership at their company.
“So often, people teams and executives think, ‘that’s not possible given the resource constraints that we have,’” Jackson says. “However, we learned that employees aren’t only thinking about moving up the ladder when it comes to their development. Employees want experience, exposure, and education. And those can be completely free.”
For example, on-the-job learning through stretch projects and opportunities for job shadowing can be particularly impactful at improving motivation, Jackson says.
Additionally, employees are motivated by knowing how their work makes a difference and feeling like it has a purpose, she explains. It’s easy to get caught up in the day-to-day, but leaders should take time—annually, at a minimum—to share where the company is going and how everyone’s role is critical to that overall mission, Jackson explains.
“In today’s climate of uncertainty, employees need to have confidence in the leadership and direction of the company to want to exert themselves,” Jackson says. “They’re seeing large, long-established companies floundering, and don’t want to waste effort building the company if the company isn’t going to be around in two years.”
What leaders can do instead, Jackson says, is create more transparency and visibility through initiatives like “ask me anything,” skip levels, and unified messaging across the executive leadership team.
The report also finds that just 69% of employees feel appropriately recognized and only 60% believe that the right people are rewarded for their efforts. Investing in employee recognition isn’t just about making people feel good, Jackson says, it’s about reinforcing the behaviors and contributions that drive the business forward.
“What gets rewarded gets repeated, which makes recognition a powerful lever for both your organizational performance and culture,” Jackson says. “When employees see that their efforts are valued, they’re more likely to stay engaged, motivated, and aligned with company goals. But if recognition is inconsistent or misaligned, where the wrong behaviors are rewarded or great work goes unnoticed, it can become a detractor, leading to disengagement and even a decline in performance.”
Taking a strategic approach to recognition ensures that employees can focus on what truly matters, whether that’s innovation, collaboration, or customer impact, Jackson says. HR leaders who make recognition a deliberate part of company culture are creating a cycle where the right behaviors are reinforced, performance improves, and the organization can thrive.
The report notes employee agreement that performance reviews adequately reflect their impact has dropped from 77% in 2022 to 70% in 2024. Of employees who believe their job performance was evaluated fairly, 83% feel motivated, compared to 49% of employees who don’t believe their performance was assessed fairly.
“If you think your effort isn’t going to be reflected in your performance review, why even try? This disconnect not only leads to declining motivation but also engagement and turnover,” Jackson says. “When someone strongly believes their performance was not evaluated fairly, they’re 88% more likely to leave the company within a year than average.”
To make sure performance reviews accurately reflect employees’ impact on work, HR leaders should consider incorporating self-reflections or external feedback to provide a more rounded understanding of employee contributions, Jackson says. Additionally, discussing performance quarterly, rather than annually, can help managers stay up to date with employees.
There are plenty of steps HR leaders can take to improve communication with employees and address their needs at work, Jackson says. These include the following.
- Implement a continuous feedback system. A continuous feedback system with regular one-on-ones using shared agendas where both managers and employees can contribute topics can help improve trust and motivation, as opposed to relying solely on annual reviews, Jackson says.
- Reduce bias in performance evaluations. By establishing clear metrics and evaluation criteria for performance reviews, HR leaders can reduce bias and keep employees feeling supported, Jackson says. A quarter (25%) of employees say their supervisor’s personal biases have impacted their reviews, according to the report.
- Shift the mentality around performance management. Focusing on continuous improvement—rather than just compliance—can help align employee contributions with employer goals and emphasize the importance of development, she says.
- Address challenges. “An important need that employees have is feeling progress in their work,” Jackon says. “Have managers ask if there are any blockers or challenges that are impeding progress that they can help them overcome.”
