Effect of Non-Monetary Compensation on Employees' Performance of Small and Medium Enterprises in Zamfara State

Small and medium enterprises (SMEs) in Nigeria are key drivers of employment and economic growth. Despite government support through funding, tax incentives, and capacity-building programs, many SMEs still face challenges in motivating and engaging employees, leading to low morale, inconsistent effort, and high staff turnover, which negatively affect organizational performance, this necessitate the study of effect of Non-Monetary compensation on employees’ performance of small and medium enterprises in Zamfara State. The study adopted the survey research design; the target population consists of all the SMEs employees in Zamfara State. The sample size of three hundred and eighty nine employees (389) was determined using Taro Yamane formula. Convenience sampling techniques were adopted to select the respondents. The data for this study was collected with the aid of structured 5-point Likert scale questionnaire, and hypotheses were tested using regression in Partial Least Square Structural Equation Modeling. The study revealed that promotion and recognition has negative and insignificant effect on employees’ performance while insurance benefits has positive and significant effect on employee’s performance of small and medium enterprises in Zamfara State. Nigeria. The study recommends that Promotions should be based on transparent, merit-driven criteria that emphasize competence, skills, and measurable performance rather than tenure, favoritism, or informal considerations, owner and managers should review and redesign recognition systems to ensure they are fair, transparent, timely, also to deliberately incorporate comprehensive insurance benefit schemes into their human resource policies.