Why You Should Not Use Monetary Incentives to Increase Productivity in the Workplace

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Sometimes, in the end, using money as an incentive can negatively impact productivity in the workplace.

Andy Core is an expert in Work-Life Balance, Well Being, and Peak Human Performance.

Sometimes using money as an incentive to increase productivity in the workplace can give you quick results that may appear effective at first, but in the end can demotivate further. Money gives short-term benefits to the organization and the employees, as well.

Increased Costs

It is quite obvious that when you tend to give out benefits you will in turn, incur major costs, depending on the spending. These will cut into the business profits and as a profit-making organization, this might not be one of the best ways to motivate your employees. When the motivation levels reach their peak, the monetary incentives become a ongoing expense.


Trying to increase the productivity in the workplace can often be something that will take time to plan and then execute. Sometimes trying to involve money may require you to raise the money and so on. This means that there is going to be a lot of logistics in preparing a package that suits each employee.

Lastly, the benefit derived from money is short term. For example, give an employee an incentive this month, next month they will expect another one. This means you have to be prepared to face such issues when you decide to use money as a motivator to increase productivity in the workplace.

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Author and speaker on work-life balance, productivity and wellbeing
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