Most HR professionals get employee gifts wrong

Most HR professionals get employee gifts wrong

Key points: 

  • 60% of surveyed HR professionals send employee swag as a holiday gift. Only 2% of employees actually prefer swag. 
  • 21% of HR professionals sign gifts “From HR.” Only 4% of employees want a gift from HR.
  • 40% have sent a thank-you note. Only 2.5% of employees are satisfied with a thank-you note alone.
  • 25% struggle to get the right holiday gift due to budget constraints.

Most HR professionals squander their best opportunity to reinvigorate the workforce by giving the wrong employee gift during the holidays. 

We had a hunch there was a mismatch between what employees really want and what they actually end up getting from employers around year’s end. And we were right, according to our 2022 holiday gifting survey

We presented our findings in a webinar for SHRM (the Society of Human Resources Management), and used this forum as an opportunity to conduct even more research. 

It turns out, there’s even less alignment between HR departments and employees than we thought. The most common gifts HR departments send employees is swag, with over 60% of surveyed HR professionals reporting that’s generally what they give. 

We hope to help close the gulf between what HR departments have sent in years past and what employees want for the holidays this year. 

HR departments often send 3 of the gifts employees like the least

Here’s the breakdown of the top 5 gifts HR departments send employees as a token of appreciation:

  • Swag: A little over 60% 
  • Money added to paycheck: Around 40%
  • Thank you note: A whopping 40%
  • Gift card to a specific retailer: Over 35%
  • Team dinner: A little over 30%

(This data adds up to more than 100% – many HR departments have sent multiple gifts to employees, depending on the occasion.)

Let’s compare this data with the top 5 gifts employees have indicated they actually want for the holidays, in descending order:

  • Money (cash or check) 
  • Money (added to paycheck)
  • Money (a digital Visa card)
  • More paid time off
  • A gift card to a specific retailer

Meanwhile, these are the least favored gifts among employees:

  • Company swag
  • A thank-you note
  • An experience (like a wine tasting, comedy show tickets, etc.)
  • Team dinner at a nice restaurant 
  • A personalized gift 
A graph showing that HR professionals most often gift swag.

At present, HR departments are giving employees their least favorite gift – company swag – about 60% of the time. Forty percent of the time, they’re giving employees their second-least-favorite gift: a thank-you note. 

The lesson here is that giving the right gift isn’t necessarily easy, depending on company budgets, but it is simple. Employees prefer money. 

There are real roadblocks to sending the right gift – but there’s also a way around them

If getting the right holiday gift was easy, everyone would do it.

The most common challenges, according to our SHRM survey, include the following:

  • 25% struggle with budget constraints
  • 18% struggle to ensure employees actually like the gift
  • 17% have trouble picking the right gift 
  • 9% hit roadblocks when distributing the gifts
  • 8% have difficulty getting buy-in from executives to spend on employee gifts

Formidable challenges, to be sure. But we have some suggestions for surmounting them. 

Executive buy-in

Getting executive buy-in is always hard. But numbers speak volumes. 

Here are some impressive stats to bring to your executive team next time you’re planning your holiday gifting budget:

  • 75% of employees say their job satisfaction increases after they receive a good holiday gift
  • 67% of employees feel appreciated by a gift costing $50-$100
  • 82% of employees think employers should give gifts around the holidays
  • 75% of employees experience a boost in job satisfaction for 3 or more months after receiving the right holiday gift
  • 46% of employees experience a boost in job satisfaction for a year or more after receiving the right holiday gift

Basically, the ROI for getting the right holiday gift for employees is significant. We can prove it. So pushing for enough of a budget to satisfy most employees this holiday season is worth the time and money. 

Focus on holidays over other occasions

For those struggling with budget constraints, we discovered something helpful in our research. The vast majority (82%) expect a gift around the holidays. Way fewer employees expect gifts for events like wedding anniversaries, birthdays, and work anniversaries. 

Meanwhile, there are several occasions where many HR departments send gifts to employees, including employee recognition (almost 60%), non-performance related events (over 50%), and achievement-based events (over 30%). 

Our data indicates it may not be necessary to splurge on these non-holiday expenses. Gifts for employee recognition and achievement-based events are a kind gesture or even part of a retention strategy, but gifts for non-performance related events, like wedding anniversaries or birthdays, may not be necessary. 

Overwhelmingly, employees expect gifts around the holiday season. So cutting budget for non-performance related events may help to free up some spend for holiday gifting.

A graph showing that HR professionals frequently give employees gifts on occasions other than the holidays.

Ensuring employees like the gift you pick out

Our data leaves little doubt about what employees want for the holidays. It’s money. Specifically, between $50-$100 will leave 67% of employees feeling better about their jobs for a substantial amount of time. 

Presently, most (51%) of HR professionals spend between $1-$50 on holiday gifts. A quarter spend between $51-$100, and a surprising amount – 19% – spend between $101-$500 on each employee gift. 

Increasing spend per employee to $51-$100, of course, will please more employees. Increasing the denomination of holiday gifts to $50 rather than $10 or $25 could pay off big.

Meanwhile, those spending up to $500 are definitely going above and beyond. But this level of generosity may not be necessary to spur a surge in holiday spirit. 

Distribution

Distributing gifts can absolutely be a pain, especially in our post-covid reality. With so many businesses now remote, it’s no longer possible to simply drop gifts at each employee’s desk like a corporate Santa Claus. 

Sending gifts by mail is not only inefficient, but more expensive than just sending them digitally — especially if it’s a parcel that costs several dollars to send and might be delayed, too.

We found a substantial percentage of SHRM respondents still manually send gifts, whether they’re paper checks, gift cards, food, swag, or other physical gifts. 

Pivoting away from physical gifts and instead sending virtual gifts resolves this problem entirely. Instead of looking up addresses, paying for postage, and hoping every gift arrives safely at the appropriate destination, HR reps need only fire off an email. 

Conclusion

Armed with accurate insights, HR professionals have a great chance of giving employees the ideal gift this holiday season. And if you can, you should. The end of the year provides an indispensable opportunity to revitalize most of the workforce for three months or more. 

We’ve got an in-depth guide to gifting that can help HR professionals get exactly the right gift for exactly the right employee this year. But, here’s the TL;DR: give every employee between $50-$100, and you’ll be able to show executives that holiday gifts pay off and score more budget next year.

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