March 31, 2015

Workers are motivated by the “greater good”

Workers are motivated by the “greater good”

People who work for socially-active companies:

  • work harder and show greater commitment
  • are willing to forgo private compensation to contribute to wider social causes
  • are less swayed by incentives such as higher pay and career prospects

Attracting and retaining motivated employees is a crucial part of business success – but are workers just looking for competitive pay and fast career growth?

A new article by Mirco Tonin looks at the role that social responsibility plays in workforce dynamics, demonstrating that workers show more commitment to businesses which promote the greater good. If a job is associated with a social cause, employees tend to work harder and show greater levels of motivation.

This implies that companies with typically less-motivated workforces may benefit from promoting their social efforts. The public sector, in particular, is generally not very successful in attracting driven employees, and might counter this issue with more socially-focused job adverts.

Of course, the notion of “social value” is largely subjective, and a good match between workers and firms can be difficult to judge; and extrinsic incentives do still succeed in attracting workers in many industries.

More rigorous research may be needed to decide how policy should guide recruitment processes, but it is still important to note that a business’ external activity and public perception plays a substantial role in the firm’s productivity.

Are workers motivated by the greater good? by Mirco Tonin was published on 31st March 2015.

IZA World of Labor is a free, online resource created by the Institute for the Study of Labor (IZA) in collaboration with Bloomsbury Publishing Plc. Articles focus on global labor economics issues, drawing on empirical, evidence-based research in order to offer pertinent comment and evaluation, and best-practice policy advice.

Mirco Tonin is Associate Professor of Economics at the University of Southampton, and a research affiliate at CESIfo in Munich. He is also a UniCredit Europe Fellow at the Economics Department of the Central European University, Budapest. He joined the IZA as a Research Fellow in 2011.