When employee morale is low, it alienates the workforce, makes it difficult for supervisors to lead and costs the company money. When it's high, morale can improve productivity and sustain a fully engaged workforce. Employee morale often is difficult to measure, but it's easily recognized when it moves in either direction. The causes of high or low employee morale include turnover, employment practices, training, recognition and reward.
An employer's obligation is to provide the tools that employees need to be successful. That can range from ergonomically correct office seating to leadership training. But cross-functional training is particularly important concerning morale. Cross-functional training is an investment that enables employees to acquire skills that will render them valuable in more than area of the organization. In turn, this improves morale because employees appreciate the ability to transfer or be reassigned so that they survive possible cutbacks or layoffs or explore business areas that could prepare them for transitioning into a different job.
Turnover's Negative Effect
In many cases, turnover can have a negative impact on morale. When employees see their colleagues resigning or being terminated, they either wonder if they, too, should be looking for other jobs or if involuntary turnover is a sign that the organization is headed for trouble. On the other hand, turnover and the infusion of new talent can improve morale. Bringing in new employees with fresh ideas and perspectives might be just what it takes for employees to believe that the organization is interested in actually growing and not becoming stagnant or irrelevant in the marketplace.
Effective Leadership Makes a Difference
In his book titled, "The 7 Hidden Reasons Employees Leave -- How to Recognize the Subtle Signs and Act Before It's Too Late," management consultant and HR expert Leigh Branham says ineffective leadership is one of the reasons employees quit. But turnover isn't the only result of poor leadership. Employee morale can plummet when supervisors and managers don't devote enough time to addressing workforce issues, giving employees continuous feedback or resolving workplace concerns that affect job satisfaction. Effective leaders -- the kind who give proper guidance and feedback -- may see their employee morale levels rise because their staff believes that supervisors and managers are genuinely concerned about their development.
Opportunities for Advancement
Like training, opportunities for advancement can raise employee morale. Employees who believe there's a future for them with the organization -- and want to build a career with the company -- are motivated to achieve high performance ratings. Even for employees in the early stages of their careers, knowing that upward mobility exists is enough reason to stay focused on their achievements and mindful of what lies ahead. On the other hand, if those opportunities for advancement aren't provided in a fair and equitable manner, then morale can dip because employees who are excluded from promotion tracks may sense that only certain workers are eligible for higher level positions.
Compensation and Rewards
Salary or wage levels don't necessarily impact employee morale, but compensation may affect how the organization perceives its most valuable commodity -- its human resources. Employees who believe they receive fair compensation, although it may be lower than what they might prefer, aren't likely to feel underestimated or unappreciated. On the other hand, even high wages can't guarantee high employee morale or repair low morale if the company's tactic involves using financial incentives, such as higher-than-average wages and bonuses, to stabilize its workforce.