Almost two thirds of employers (64%) think incentives give a positive return on investment within their organisation but only 40% have a tactical plan for how they will use incentives this year.

But market conditions have had an impact on incentives as 63% of employers strongly agree they will introduce incentives as a response to the downturn.

According to a survey commissioned by incentives provider Grass Roots, more than nine out of 10 (92%) think offering staff incentives is a good way to gain advantage over competitors and 61% agree in recession there is a greater need to incentive employees.

Adam Sidbury, board director at Grass Roots, said: "The two things that come under real scrutiny at times like these are the sales line and employee morale and performance. Incentive and reward programmes have a major role to play in both of these areas."