Are Your Incentives Gender-Specific?

September 17, 2024

Incentives aren’t gender neutral — women and men tend to respond differently to different types of incentives, recognition and rewards, according to a study by the IRF.

Men and women may work equally hard to earn a reward from their employers, but the way companies incentivize, recognize and reward them may be more effective if they tailor their programs to appeal specifically to each gender. Women make up almost half of the U.S. workforce — and more than half of the white-collar workforce — and yet they tend to be less satisfied than their male colleagues with almost everything related to their work, including how their work is recognized and rewarded.

While individual preferences will of course vary by any number of factors, “Credible evidence exists to suggest that men and women prefer different rewards, perceive them differently, and respond to incentives and rewards differently,” concludes an Academic Research in Action study by the Incentive Research Foundation (IRF) called Differences in Workplace Reward Preference and Outcomes, Men Vs. Women.

Among the differences outlined in the report are:

Women are more drawn to non-cash incentives. While tangible, non-monetary rewards generally result in higher performance than cash rewards, women in particular tend to be even more attracted to non-monetary incentives than men, who tend to be drawn more toward cash-based incentives and rewards. The study quotes a 2020 peer reviewed paper published in the Journal of Business Economics, which says, “Our findings suggest that men feel most valued when monetary rewards are given, while women feel much more appreciated by non-monetary incentives, which is reflected in employee performance.” The paper cites other research into gender differences that find that women tend to get more of a psychological boost from interpersonal rewards such as non-cash incentives, which often include social recognition.
How you describe the reward matters. Both men and women are more likely to switch from a cash incentive to a non-cash incentive of equivalent value when that non-cash reward is described in vivid terms. As the report says, “The more effectively tangible non-cash rewards are communicated, explained, and presented, the more they will create an emotional response from both sexes.” Because women are more likely to be drawn toward non-cash incentives in general, the more visual and emotionally resonant the description, the more likely you are to get greater buy-in from men as well.
How you present the reward matters, too. Men tend to prefer a “big show,” where women tend to be more comfortable with a more subdued form of recognition, the report says. In fact, the top reward presentation format for women was when it is done peer to peer or with little fanfare, while men put all three at the top of their preferences.

While some have expressed concern that continuing to emphasize the differences between men and women in the workforce could actually end up reinforcing traditional gender stereotypes and workplace inequalities, the IRF paper doesn’t appear to buy into that notion. “The Incentive Research Foundation’s (IRF) own research has revealed stark gender differences between men and women in terms of how rewards should be presented. While some differences are rooted in individual preferences and values, others are shaped by workplace environments and societal expectations.”

While it’s important not to reinforce stereotypes, the paper concludes, “While men may generally express initial preference for cash incentives, women may (generally) find non-cash rewards more attractive and motivating, particularly those that offer social recognition and personal development. Understanding these differences is essential for designing equitable and effective incentive systems in the workplace and this may be especially important where rewards cannot be easily individualized and/or in organizations whose workforce skews significantly female or male.”