Acknowledging this will show them the effort they are making is important. It will hopefully spurn them on to continue to perform well rather than wondering if their efforts matter. I had a personal experience with this. In one of our furniture divisions I was looking at all the work two of our fabricators had done for the week. It was amazing. When I told them this you would have thought I just gave them a $1,000 bonus. Just knowing that your boss or manager appreciates your hard work can easily lead to positive outcomes.
It is also helpful to recognize the good things in life. Giving out raises is a happy time for everyone. Rather than just putting a note in their pay slip, why not approach each employee and thank them personally? That is a perfect time to say thank you to each employee for his or her hard work and reinforce positive working relationships.
Your approach in recognizing your employee's efforts is important as well. Going up to an employee and just telling them they did a good job can seem vague. What did they do that was good? Elaborate on this for them. It shows that you are really paying attention to what they are doing and you are recognizing them for that.
Taking an interest in their families also shows your employees you are human. There is nothing wrong with inquiring about how life is going outside of the shop walls, as long as we also respect their privacy and don't meddle in their personal lives.
I have never been big on handing out personal awards to employees. You know, the "employee of the month" type thing. I feel too many things can back fire when taking that approach.
There was once a survey called the Federal Human Capital survey. Only 30 percent of all respondents agreed with the statement, "Our organization's awards program provides me with an incentive to do my best."