Employee morale is the overall emotion, attitude, and outlook of your employees towards their job and the company in general.

You know your employees have high morale when they are confident, excited to work, proactive, communicative, and generally happy when they are around the office. On the flipside, employees with low morale are often disengaged, irritable, isolated, frantic, and generally in a low mood.

In this article, we will delve into the factors that shape employee morale, the importance of keeping employee morale from dropping, and how you can actively strategise ways of keeping your workforce happy, satisfied, and productive.

Why employee morale matters

Employee morale is not just a display of attitude towards work, but more of a signal for managers to act on certain issues that may affect the overall productivity of the workforce.

If your employees have been engaged with the organisation in the last few months, it is important to know why so you can replicate it across the company. If you notice a drop in productivity in some of your team members during a stressful time, it might be a sign that you need to do something to lift their morale.

 Gallup’s latest “State of the Global Workplace” report shows that 44% of employees worldwide are experiencing a lot of stress. The same study also shows that these employees have been “quiet quitting” or silently looking for opportunities outside their current companies. The figures show that a stress-induced drop in employee morale can readily translate into attrition quickly if not addressed.

In a nutshell, monitoring employee morale is important because it has always been directly tied to employee satisfaction, retention, loyalty, and productivity.

Factors that affect employee morale

There are a multitude of factors affecting employee morale, which include work environment, recognition and rewards, communication, and work-life balance. In most cases, employee morale is a direct result of a combination of these factors, which makes addressing it a complex matter. Knowing the temperature of your workforce’s morale is the key in creating strategies for employee engagement and loyalty.

1. The work environment’s impact on employee morale

There are many ways to define a work environment, but it is generally a physical or virtual space where employees do their jobs and interact with their leaders and teammates. Work environment, however, can also mean relationships with leaders and colleagues, which in a broader sense, translates to company culture.

A recent study shows that at least 85% of employees believe that work environment shapes their mood and greatly affects their productivity daily.

From a physical standpoint, key aspects of a workplace environment, such as noise level, odour, lighting, ventilation, temperature, esthetic, and cleanliness are factors affecting employee morale. From a cultural perspective, however, it can be all about leadership style, engagement opportunities, wellness and communication channels, among other things.

2. The role of recognition and rewards

A series of studies by the Harvard Business Review revealed the huge impact of recognition in boosting employee morale. Recognition, which can be in the form of symbolic and monetary incentives, directly contributes to an employee’s feeling of being valued and recognized at work.

“Recognising and empowering employees can increase motivation and improve performance across the organization,” Harvard said, summarizing the findings of its research papers. The study also shows that “the who” or the source of the recognition matters, and that rewards coming directly from leaders place more value in the act. When recognition is given also matters, the study added, as giving recognition at a stressful time can significantly boost morale in a deeper way.

3. The communication factor

Effective communication is also a cornerstone of a healthy work environment that directly translates to high employee morale. McKinsey reported that well-connected teams, where members easily communicate across levels, tend to see a 25% increase in work productivity. Well-connected teams are usually a result of clear communication channels, regular updates, and robust feedback mechanisms.

4. Finding the right work-life balance

More than just a term that gained prominence during the COVID-19 pandemic, work-life balance has been a key feature of an ideal workplace today. Studies by the research firm Conference Board revealed that the leap in work-life balance quality in 2022 resulted in a 2-percentage point rise in job satisfaction rate in the US. The work-life balance achieved through flexible work arrangements has been a great contributor to higher morale and job satisfaction in the last few years.

Strategies for boosting employee morale

Now that we have established the value of employee morale and the factors that shape it, it’s time to look at ways of boosting your people’s morale.

1. Create a workplace for people and community-building

Consider reworking your office space in such a way that it can be more conducive to work collaborations and daily human interactions. Cubicles and closed rooms are important for focus but ensure that there is enough space for people to interact as offices tend to be an isolating place. Take a good look at your office’s current design and layout and find out what needs improvement.

Apart from the physical aspect of the workplace, you may want to start making active efforts to establish a people-centric company culture. You may want to start with simple team-building activities to get to know your employees more while fostering camaraderie within the workforce. 

The most important aspect of creating a positive workplace environment is making sure that you listen to your people. So, before implementing changes or executing strategies, always make sure to do a quick survey that will allow you to know the pulse of the workforce.

2. Build a culture of gratitude 

Implementing structured employee recognition programs, such as award-giving events or even simple congratulatory emails, can be a powerful way to boost the morale of your people. Appreciating employees for their contributions can have a profound impact on their engagement and commitment to the organization.

Consider making your recognition programs tailored as people tend to value recognition that is more personal in nature. Whenever possible, send out recognition communications from people who matter, such as managers and company executives. Even personalized gestures, such as a simple "thank you" note or public acknowledgment during team meetings, can also go a long way in making employees feel valued.

More importantly, implementing incentive programs, such as performance bonuses or employee of the month awards, provides tangible rewards for outstanding efforts. These programs not only motivate employees but also create a competitive yet supportive atmosphere.

3. Establish open and transparent communication

A study by the Workforce Institute showed that 74% of employees tend to be more effective and productive when they feel that leadership listens to them. This is why it is important to establish a safe and open feedback mechanism that will allow both parties to understand each other more.

Using technologies like super apps can help bridge the communication gap between managers and employees. Apps like these can make sending out employee satisfaction surveys easier and more engaging. Focused group discussions and regular employee one-on-one with the human resource staff can also make a huge difference in fostering transparent communication.

It is also important to keep your people abreast of the big picture in terms of the company’s overall direction, especially when your organization is undergoing changes. This makes them feel that they are truly part of the company and not just mere cogs in a big corporate machine. Sending out quarterly newsletters can be an effective way to do this. 

4. Promote work-life balance 

Promoting work-life balance is a key strategy in enhancing employee morale, well-being, and overall job satisfaction. Striking a harmonious balance between professional responsibilities and personal life contributes to a healthier and more motivated workforce. Studies have consistently shown that companies with flexible work options see a 25 percent drop in employee turnover, a crucial thing in light of today’s labor shortage.

Consider offering flexible work arrangements, such as remote work options or flexible hours, to roles that can do away with the traditional 9-5 or the traditional onsite-only structure. It must be easier now since larger companies, such as Microsoft and Spotify, have established effective flexible work models that anybody can follow.

Another crucial aspect of work-life balance is wellness. An American Journal of Health Promotion study shows companies with comprehensive wellness programs see a 10% increase in productivity. Building programs that support mental health, promote respect for personal time, and mental wellness breaks will help you sustain high morale among your workforce.

READ MORE | How to boost employee morale during difficult times

The long-term impact

Making efforts to boost employee morale is a strategic investment with profound and lasting impacts on an organization. In a time of quiet quitters and skills shortages, keeping your team in high morale puts you in a position of security and growth.

The long-term benefits of maintaining high employee morale extend beyond immediate job satisfaction. A content and motivated workforce is more likely to exhibit increased productivity, reduced turnover rates, and heightened creativity and innovation.

Employee morale is intricately linked to organisational success, and the effects ripple through various facets of the business. The commitment and loyalty of a satisfied workforce lay the foundation for enduring success, making it imperative for organizations to view employee morale not as an isolated metric but as a driving force behind their long-term prosperity.