Meaningful Years of Service Recognition for a Multigenerational Workforce

By: Jessica Sheets
diverse multigenerational employees talking to each other

The traditional approach to employee engagement and years of service recognition doesn’t generate the same level of loyalty in our current era of job-hopping and postponed retirements. Generational expectations have changed. Significant shifts in when, where and how people work have inspired employees to re-examine their priorities and seek work/life alignment. 

Workplace trends around employee disengagement and resignations set off a frenzy of op-eds highlighting the evolving relationship between employees and employers. And recent U.S. labor statistics point to an even bigger retention issue with today’s 5-generation workforce: In 2022, about 50.5 million people quit their jobs, up from 47.8 million in 2021, according to Job Openings and Labor Turnover Survey data. Early indicators show this trend is on track to continue in 2023. 

To reduce turnover, HR leaders must rehumanize the employee experience. Years of service (also known as an employee or service anniversary) recognitions are a tried-and-true employee engagement strategy. Whether an employee is in their first year with your organization or 40th, their contributions are cause for celebration. But making service awards meaningful requires understanding and matching multigenerational motivations. 

Evolving Priorities for Employee Engagement

Understanding your employees’ generational values and goals goes a long way toward building an impactful years of service recognition program. The Silent Generation (b. 1928-45), Baby Boomers (b. 1946-64), Generation-X (b. 1965-80), Millennials (b. 1981-96) and Generation-Z (b. 1997-2013) approach work with unique mindsets and priorities. But there are many similarities across all age groups, too. Workers similarly weigh factors such as compensation, meaningful work, flexibility, advancement potential, workplace safety and a supportive environment when considering whether to take or leave a job. 

graphic showing the five generations in the current workforce

Generational Differences

Organizational culture is becoming increasingly important, especially among those entering and rising in the workforce. Gen-Z and Millennials report that culture plays a big part in their intent to stay with their employer at nearly 40% for the two groups, compared with 30% of Baby Boomers, according to Forbes.

And with recent recession concerns causing a significant portion of Boomers to delay retirement, younger up-and-comers are feeling frustrated by the lack of advancement potential. When they’re told “not yet” regarding a promotion, they start to look elsewhere.

Generational Similarities

Despite differences, workers across generations share a universal desire to be recognized. Organizations must appropriately acknowledge and reward their people, or they will lose them. 

According to a McKinsey analysis of age-based worker preferences, employers shouldn’t try tailoring the employee value proposition and work experience by generation. 

“It’s much more worthwhile for organizations to focus and take action on the factors that nearly all employees want…while appreciating the nuances of how they want them based on their stage in life, personal circumstances, and individual preferences.”

Shifting Employee Years of Service Awards

Years of service programs operating off an old playbook reward milestones at distant intervals. Employees don’t want to wait half a decade for recognition. Gallup calls Millennials “consumers of the workplace,” with most staying in a job for less than three years. 

We recommend recognizing employees at year one, year three and year five milestones when using years of service as an engagement and retention strategy. Knowing when the service milestone should be recognized is crucial in retaining employees. Our best practice is to recognize early and often. ITA Group clients who have used our approach to issue employees at least one recognition in their first year of employment have on average a 27% higher retention rate than organizations without a formal recognition program. 

Related: Strategic Employee Recognition Program Unites Team Members at a Global Pet Retailer

In addition to timing, the awards should resonate with your employee audience. When employees are highly satisfied with the recognition offered, they’re 31% more likely to believe their employer is committed to keeping them. If recognition falls flat, it could have a negative impact on your efforts. 

Younger generations gravitate towards travel and experiences, whereas Gen X and senior generations often prefer status gifts, such as luxury accessories (think: cufflinks, designer handbags, watches). What motivates individuals can vary, so it's best to offer a diverse range of award options employees consider valuable. Remember to continuously collect feedback on their recognition experience.

Related: Refreshed Service Awards Strategy Enhances Employee Experience

How awards are presented matters, too. Consider the emotional brand connection, and design service awards to be a positive, pro-social experience. Encouraging managers to recognize employees for their years of service at a company-wide event doesn’t just lean into a celebratory environment. It’s an opportunity for leaders to demonstrate they care. We know employees who are recognized by managers are 67% more engaged and 1.3 times more likely to stay loyal to the organization. And their recognition might also inspire others, too. (Tap into Gen Z's affinity for influencers!)  

Consistency is key. Having a recognition platform where employees can be recognized not only improves employee engagement, but it also helps company leaders keep track of milestones. Letting a ‘workiversary’ slip by can be harmful to employee morale. Using a recognition platform with a dashboard and other analytic capabilities helps company executives and managers proactively plan years of service recognition. The best platforms also enable peer-to-peer recognition so employees can celebrate each other. 

Every generation wants to feel valued. Celebrating contributions at key milestones is an important component of any employee recognition program. Considering generational preferences deepens engagement.

Ready to take retention seriously? Learn more about what a tailored employee experience solution can unlock.  

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Jessica Sheets
Jessica Sheets

Jessica is a Senior Strategist for Employee Experience Solutions at ITA Group. With a background in corporate well-being, she offers a unique perspective on rehumanizing the workplace through effective employee engagement strategies. Her insights bring clarity to the whole-person employee experience and how engagement experts can serve safety-driven cultures and deskless workers. Jessica is a Des Moines native and a graduate from Drake University. In her free time, she loves being outdoors and traveling with her family.