Would you love me if I could offer you free gourmet food or freshly baked bagels for breakfast? Would you be in good spirits if I could provide you with pre-release tickets to sell-out concerts by the likes of Lady Gaga or Shakira? Or would you appreciate classes on Wii Nintendo, bowling, gym, swimming pool, discounted massages and personal trainer? These are some idea of the rewards to staff circulating in the HR departments of certain large organisations. From scuba diving in New Zealand to walking on ice in the South Atlantic, companies seem ready to try anything. However, it does not seem to be the time for cash bonuses, improvement of health benefit programmes or, above all, investment in mentoring and training courses. Innovative and low cost ways of incentivising staff seems to be the measure of quick fix in the tough times that many companies are facing.

Traditionally, companies have always provided workers with the old-school perks such as free drinks and snacks. According to The Carrot Principle (Simon&Schuster, 2007), employees rate their desire to stay in their jobs for another year at only 24.7 per cent if they don’t feel enough recognition, and Gallup polls showed that after seven days, employees would have already forgotten this type of reward. However, removing perks would mean anger, upset staff and “panic that if the company can no longer afford coffee, it must be headed for disaster”, says Bob Nelson, author of 1001 Ways to Reward Employees. And this does not help in this current economic climate. So employers are choosing frivolous and cheap perks more and more to encourage motivation, engage the workers and hope for increased productivity, possibly more than industry’s average. In fact, while Google was named “The Best Company to Work For in 2007” by Fortune magazine due to the perks they offered as opposed to the level of investment that went into training programmes, SAS software company from the USA tops the 2010 list because it suggests employees’ children to go to summer camp.

Companies such as Red Balloon or API Leisure & Lifestyle, which offer thousands of lifestyle and financial packaged perks to companies for their employees, reported very good business. API business development manager Serena Triggs argues that in the current economic climate, perks such as fuel and grocery discounts, as well as subsidised home loans, appear to be more favoured by staff. So large companies are looking into this innovative way of motivating their employees. Indeed, Naomi Simson, founder and CEO of Red Balloon, adds that “in troubled times you need to hold on to your best staff and you want your employees more engaged than ever before. If there’s no cash to flash, it is doubly important to acknowledge your workers in some other way.” Simson says that these perks seem to make a difference to morale.

The Boston Consulting Group report, entitled “The New Social Contract – Engaging Employees during a Downturn”, places emphasis on rewards and recognition that staff expect for their workplace performance and clearly state that during difficult times, employees prefer to work for supervisors who are able to understand their needs and who can motivate them. Massive Christmas parties will maintain their important role in boosting morale.

However, it appears that training cuts were among the first casualties of the recession. Spanish companies axed their training budgets by 16 per cent in 2009, according to the 2009 El Estado del Arte de la Formacion en Espana. The CIPD 2010 “Learning and Talent Development” survey report, which surveyed 441 companies in the private sector, pointed out that funds available for learning and talent development have fallen for over half of organisations in the past 12 months (52 per cent). Only one in 10 employers plan to increase their training budget in 2011.

This means that the knowledge society might go through a non-promising time. Identifying learning and training with development was never more crucial than in times of constrained finance. More than ever, workplaces need highly-trained professionals who are able to develop innovative ideas and find new opportunities. In this respect, knowledge and competence, which are at the base of innovation and creativity, need to be nurtured, while training, coaching and mentoring are the tools that give entrepreneurs the key to succeed. It does not come cheap but the cost of no training is mediocrity and finally an inability to compete.

The Panen Et Circenses formula that was so effectively used by the Roman Empire to keep the population peaceful, albeit misled, can be correlated with the 21st-century superfluous perks such as free bagels or Lady GaGa concert tickets. Although, like any other new idea, this reward system still needs to stand the test of time, it will be interesting to see whether it will be the free bagels or the talent management that will get us out of the recession.

Ms Soriano is a Spanish journalist at the Foundation for Human Resources Development