On the basis of sorting out the literature related to incentive, this paper makes an in-depth analysis of the current situation of human resources allocation and incentive in state-owned enterprises, and further discusses the existing problems and causes in the incentive mechanism. In the end, the relevant incentive theories and other advanced incentive experience combined with the actual situation of state-owned enterprises finally put forward targeted incentive mechanism improvement measures. The research methods used in this paper are as follows:Method: (1) the literature in this paper, after determine the selected topic, and utilization of the library, network, database and other resources related literature of incentive and incentive mechanism for collecting and organizing, and on the basis of consulting literature materials, has carried on the induction, literature related to incentive theory of selection is closely related to this topic research and combing, the incentive mechanism and related research status at home and abroad have a certain cognition and understanding, for the further research of this paper laid a good foundation.(2) Interview method: The semi-structured interview method is adopted in this paper to select a part of the employees of a state-owned enterprise for interview, which provides first-hand information for the in-depth study of this paper.(3) Questionnaire survey: Through the design of questionnaires and relevant data statistics, I understood and grasped the current human resource allocation and incentive mechanism of state-owned enterprises, and collected relevant information and employees' incentive demands to further improve the incentive mechanism of state-owned enterprises.(4) Induction: Induction refers to the method of analyzing and concluding conclusions by reading and accumulating existing data. On the basis of literature research, I summarized the existing problems in the current incentive mechanism of state-owned enterprises through data analysis, and summarized the improvement of employee incentive measures of state-owned enterprises through problem analysis.