GCVA Thought Leadership Report
Small Rewards, Big Impact
How Employers Are Using Gift Cards to Boost Motivation, Loyalty and Morale
Executive Summary
Foreword from Hannah Shimko, Managing Director, GCVA
At the Gift Card & Voucher Association, we see every day how targeted gestures of recognition can make a real difference. This report highlights the important role that employee rewards (particularly flexible, non-cash rewards such as gift cards) are playing in helping businesses to thrive by showing genuine appreciation for their people.
For employees, these rewards are far more than tokens. They are moments of recognition that strengthen relationships with employers, whether by offering a simple treat to share with family or providing support during the cost of living crisis. For employers, they are proving to be a cost-effective way to build morale, increase motivation, and retain talent in an increasingly competitive labour market.
Employers are adapting fast, with many schemes now more inclusive, more frequent, and more personalised. Barriers remain, including budget pressures, administrative complexity, and tax uncertainty, but momentum is strong. Seven in ten employers expect to expand their use of non-cash rewards in the year ahead.
Our aim in publishing this report is to show the strategic importance of recognition in today's workplace. Done well, these rewards help businesses succeed and make a tangible difference to people's daily lives.
Hannah Shimko
Managing Director, GCVA
Key Findings at a Glance
Recognition is widespread, but uneven →
- 63% of full-time employees received a reward in the past year, compared with just 36% of part-time staff.
- Sectors such as technology (85%) and construction (81%) lead the way, while education (36%) and central/local government (32%) lag behind.
Rewards make a genuine difference →
- 72% of employees said receiving a gift card made them feel more positive about their employer.
- 85% reported that small rewards help them feel more valued and improve their relationship with their organisation.
- 88% said a £50 reward or equivalent made a meaningful difference to their day-to-day life.
Younger workers respond most strongly →
- Early-career employees are significantly more likely to receive rewards and more likely to say these rewards improve their perception of their employer.
Employers see clear benefits →
- Gift cards are most often used to show appreciation (75%), boost morale (61%), and support retention (55%).
- 65% of employers say gift card-based rewards are seen as a valued gesture, linked with improved morale, engagement, and productivity.
- 47% of organisations provide rewards to all or most employees.
Schemes are evolving fast→
- 67% of employers have changed their reward approach in the past three years. Nearly one-third (29%) significantly.
- 32% now use digital delivery methods, while 39% personalise rewards by role or preference.
Barriers remain →
- Top challenges include budget constraints (54%), administrative complexity (49%), and tax uncertainty (37%).
- Employers are calling for better employee feedback frameworks (62%) and evidence of ROI (40%).
Future outlook is positive →
- 71% of employers expect to increase their use of gift cards and non-cash rewards in the next 12 months.
- The direction of travel is towards more personalised, inclusive, and strategic recognition.
Introduction
A Changing Workforce, New Expectations
The world of work is shifting rapidly, and with it, the ways employers engage, motivate, and retain their people. A combination of economic pressures, cultural change, and evolving employee expectations means recognition has never been more important.
Competition for talent is intense, particularly in growth sectors such as technology, finance, and construction. At the same time, younger employees are entering the workforce with heightened expectations around recognition, values, and culture. For them, feeling appreciated is central to their sense of belonging and commitment to an organisation.
The rise of hybrid and remote working has also changed how employers connect with their teams. Casual, in-person gestures of thanks are harder to deliver consistently, and nearly a third of organisations now use digital platforms to ensure recognition is immediate and accessible.
Overlaying this is the continuing cost of living crisis, which has increased the value employees place on even modest rewards. For some, a gift card provides a treat or shared experience; for others, it eases everyday expenses or helps cover the costs of working from home.
In this context, reward and recognition have moved firmly up the employer agenda. They are no longer viewed as peripheral or discretionary but as a core part of how organisations sustain morale, demonstrate values, and build loyalty. This report explores how gift cards and non-cash rewards are playing a strategic role in that shift.
What Employees Value and Experience
Our research highlights the extent to which rewards and recognition are already part of working life for many UK employees and how much they matter to those who receive them.
A clear majority of full-time employees (63%) report having received some form of reward or incentive in the past year. However, the figure drops sharply among part-time employees (36%), revealing a significant fairness gap. For employers, this is a critical finding: reward and recognition are not just about boosting morale, they also shape perceptions of inclusion and equality across the workforce.
The same divide appears across sectors. Employees in technology (85%), construction (81%), and professional services (73%) are the most likely to report receiving rewards. By contrast, the numbers fall to just 36% in education and 32% in central or local government. This disparity risks reinforcing the sense that recognition is a privilege of certain industries rather than a universal workplace expectation.
Where rewards are given, their impact is clear. More than seven in ten employees say that receiving a gift card made them feel more positive about their employer, while 85% say small rewards help them feel valued and improve their relationship with their organisation. For many, these rewards represent a genuine moment of recognition, cutting through the day-to-day pressures of work to deliver a sense of appreciation.
More than seven in ten employees say that receiving a gift card made them feel more positive about their employer
The emotional impact is particularly strong among younger workers. They are both more likely to receive rewards and more likely to say those rewards positively shape their perception of their employer. At a time when retaining and motivating Gen Z employees is a growing challenge for many organisations, small, thoughtful gestures are proving to be an effective way to strengthen loyalty.
Employees also view rewards as meaningful in practical terms. 88% of those who had received a £50 gift card said it made a significant difference to their daily life. For some, it enabled a treat or shared experience with family; for others, it helped meet essential needs or offset costs linked to working from home.
Taken together, these findings underscore the dual impact of rewards: they are both symbolic gestures of appreciation and practical contributions to employees wellbeing. Employers that use them effectively are not only improving morale and motivation, but also strengthening their employer brand and building a culture of fairness and inclusion.
Employer Attitudes:
Why Gift Cards Work
Employers are increasingly clear about the benefits of using gift cards and other non-cash rewards as part of their recognition strategies. The business survey shows that these rewards are valued not only by employees but also by the organisations that provide them.
The most common reasons employers give for offering gift card rewards are:
To show appreciation:
75%
To boost morale:
61%
To support retention:
55%
These motivations reflect the growing recognition that small gestures can deliver outsized benefits when it comes to maintaining engagement and loyalty.
Employers also believe that these schemes have a measurable impact. Around 65% report that gift card rewards are seen as a valued gesture by their staff, and many link them directly with improved morale, engagement, and productivity. In an environment where budgets are tight and recruitment challenges are acute, rewards are increasingly viewed as a cost-effective way to support culture and performance.
Use of gift card-based rewards is broad. Almost half of employers (47%) say all or most employees are included, with relatively little variation by organisation size. While larger businesses may spend more per head, small and mid sized firms often make reward schemes go further by ensuring they reach a higher proportion of their workforce.
The way rewards are delivered is also evolving. Nearly one third of employers now use digital transfers, reflecting the rise of hybrid and remote working and the need for fast, flexible recognition. At the same time, 39% of organisations are personalising their rewards, tailoring them by role, performance, or employee preference, a shift that reflects wider trends towards individualised experiences in the workplace.
For many employers, gift cards offer the ideal balance: they are flexible, efficient, and easy to distribute, while also carrying a sense of personal value for employees. As such, they are not only a practical tool but also an important part of wider wellbeing and culture strategies.
Direction of Travel:
How Schemes Are Evolving
The research shows that reward and recognition practices are not static. Employers are actively reshaping how they use gift cards and non-cash rewards, with many moving away from one-size-fits-all approaches towards more personalised and inclusive schemes.
Two-thirds of employers (67%) say they have changed the way they reward employees in the past three years, with nearly one in three describing these changes as significant. The reasons are clear: organisations are responding to the pressures of the cost of living crisis, the challenge of retaining staff in a competitive labour market, and the need to build morale in an uncertain economic climate.
The responses reveal how employers themselves describe this shift:
"We introduced more frequent, smaller-value rewards to help with cost-of-living pressures."
"Our approach has become more personalised — we now let managers choose rewards that suit their teams."
"We wanted to make recognition more inclusive, so part-time and support staff are now included in schemes that previously only targeted frontline roles."
"Digital delivery has made it easier to recognise staff who work remotely and to do it in a timely way."
These comments reflect broader patterns in the data. Many organisations are increasing the visibility and frequency of recognition, ensuring employees feel valued in their day-to-day roles rather than only at annual milestones. Others highlight the importance of tailoring rewards to individual needs and preferences, building stronger personal connections.
Digital delivery is another consistent theme. With hybrid working now the norm for many organisations, digital platforms have become essential for reaching dispersed workforces quickly and reliably. This shift not only makes schemes easier to administer, but also supports sustainability and helps integrate recognition into wider employee experience platforms.
The overall direction is towards more thoughtful, more strategic use of rewards. What was once seen as a token gesture is increasingly being treated as a lever for culture, inclusion, and retention. Employers are recognising that small, consistent investments in appreciation can have a cumulative impact far greater than their monetary value.
Barriers and Opportunities
While the value of gift card and non-cash reward schemes is clear, employers also face a set of barriers that limit how far and how effectively these programmes can be implemented.
The most common challenge is budget. More than half of employers (54%) cite cost as the main factor restricting the scale of their schemes. In an environment where margins are tight, even modest investments in recognition are subject to scrutiny, despite evidence of their positive impact on morale and retention.
Administrative complexity is another concern. Nearly half of employers (49%) want simpler distribution tools that make it easier to deliver rewards consistently across teams. This reflects both the challenges of hybrid workforces and the desire to reduce the time managers spend administering recognition schemes.
Tax uncertainty also plays a role. More than one in three employers (37%) say that lack of clarity around the tax treatment of rewards is a barrier to greater use. For some, the current £50 trivial benefits limit constrains what they feel able to offer, even where they see the potential for rewards to play a bigger role in wellbeing and engagement.
Employers are also looking for more support in measuring and maximising impact. 62% want better employee feedback frameworks to understand how rewards are perceived, while 40% are seeking clearer evidence of return on investment. Many also want stronger guidance from suppliers, with 34% calling for more proactive support and advice on scheme design.
Together, these findings point to both challenges and opportunities. Employers recognise the power of rewards, but often feel limited by cost, complexity, or compliance. Industry collaboration, smarter technology, and clearer policy could help unlock greater impact.
This is also an area where policy change could make a difference. Raising the Trivial Benefits threshold would be a simple but effective way to enable employers to provide fairer, more consistent rewards. It would not only reduce administrative burden but also support the wider adoption of recognition schemes that make employees feel valued in a genuine and tangible way.
The Future of Reward: Targeted and Strategic
The evidence from both employees and employers points to a clear conclusion: targeted rewards are set to play an even greater role in the future of work.
Nearly three-quarters of employers (71%) expect their use of gift cards and non-cash rewards to increase in the next 12 months. This reflects both their cost-effectiveness and their proven impact on morale, retention, and wellbeing. In an economic climate where larger pay rises may not be feasible, employers are looking for focused, meaningful ways to demonstrate appreciation and strengthen engagement.
The appetite is also for more inclusive and measurable schemes. Employers recognise the need to move beyond rewarding only high performers, ensuring recognition reaches all employees and supports a culture of fairness. At the same time, there is growing demand for better tools to capture employee feedback and track the business impact of rewards.
For employees, the message is equally clear. These rewards are deeply valued. They provide a moment of recognition that feels personal, a gesture of care that strengthens the bond with their employer, and in many cases, practical support that makes a tangible difference to daily life. From enabling a family treat to easing the burden of living costs, rewards are helping people feel both valued and supported at work.
Looking ahead, the opportunity is to embed recognition more firmly into workplace culture. Not as an add-on, but as a strategic tool for motivation and wellbeing. Employers, providers, and policymakers each have a role to play:
Employers can use rewards to build inclusive, recognition-rich cultures.
Providers can innovate with digital delivery, personalisation, and measurement tools.
Policymakers can enable broader adoption through simple changes, such as updating the trivial benefits threshold.
These are not "small" gestures, but powerful, focused tools that make a measurable difference. As the findings of this report show, their impact goes far beyond their face value.
Conclusion
As this report demonstrates, rewards are no longer peripheral gestures; they are integral to how organisations show appreciation, build loyalty, and support wellbeing. Gift cards, in particular, have emerged as one of the most versatile and impactful ways to achieve this, delivering value that employees notice and employers can measure.
At the Gift Card & Voucher Association, we are proud to champion this industry and the difference it makes in workplaces across the UK. Our aim in publishing this report is to highlight both the proven impact of recognition and the opportunities to go further, through smarter use of technology, more inclusive schemes, and supportive policy change.
We invite employers, providers, and policymakers to work with us in ensuring that recognition is accessible, meaningful, and sustainable for every employee. By doing so, we can unlock the full potential of rewards to help businesses thrive and to improve the everyday lives of millions of workers.
Hannah Shimko
Managing Director, GCVA