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A growing economy is only going to place greater emphasis on the need for workers with higher education, notes a new survey from CUNA that suggests incentive plans are an effective way of recruiting and retaining such talent.

According to the 2006-2007 Incentives Survey from CUNA's Center for Research & Advice, a majority of credit unions that offer employee incentives feel that their plans have increased employee satisfaction levels and/or improved employee retention.

Additionally, 82% of credit unions with $1 million or more in assets that offered employee incentives feel that their programs have helped to improve the credit union's financial performance, the survey found.

CUNA said it is "not surprising" that the use of monetary incentives has increased dramatically in recent years. As of year-end 2004, nearly 40% of credit unions with $1 million or more in assets offered some of their full-time employees monetary incentive payments, CUNA reported.

However, as experts point out, there are many things that credit unions should consider before offering employee incentives," the trade group said. "If implemented incorrectly, employee incentives might not only fall short of accomplishing the desired goals, but they can also have negative effects on employee morale and the credit union's bottom line."

CUNA said its survey is designed to give credit unions an overview of the key points they should consider before implementing any employee incentive plan. It also provides credit unions with the opportunity to see what types of incentives other credit unions are offering. The report uncovers strategies credit unions should consider when developing their employee incentive plans, and current trends in the usage of employee incentives at credit unions, including: the types offered, frequency of distribution, reasons for offering and if they are achieving their objectives, and the level of satisfaction credit unions have with their plans.

CUNA's "2006-2007 Incentives Survey" sells to credit unions for $75 and is available as an Adobe PDF file. Subscribers to The Point are eligible to purchase the report for $50.

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