For many organizations, employee retention is one of the leading workforce management challenges, as high turnover across various industries continues to affect the workplace.
This year, workers have been quitting their jobs in record numbers, largely occurring in low-wage jobs. As a result, employers are rightfully concerned about how this turnover is going to affect their business moving forward. It's long been understood that a high turnover rate is costly and has ripple effects throughout a business and industry at large. The US is projected to lose $430 billion annually by 2030 due to employee turnover.
One of the most effective ways to retain employees and minimize turnover in such a competitive marketplace is by offering meaningful and competitive employee benefits.
Employee benefits are essential both for attracting talent and employee retention. According to the Society of Human Resource Management (SHRM), 92% of employees say that benefits are crucial to their overall job satisfaction and almost 3 in 5 say perks and benefits are a leading priority when accepting a job. Not only are they valuable because they provide a compensatory reward to workers but also because your company's benefits demonstrate how much you appreciate and value your employees.
Advantages of a Competitive Benefits Package
Considering how competitive today's job market is, ensuring your benefits management plan reflects a positive and supportive workplace will help your company stand out from the competition and attract quality talent.
But before delving into some of the most competitive benefits and perks your business can offer, let's explore some of the advantages of providing an excellent benefits package:
- Acquire talent – If you want to attract and hire the best employees who are motivated, you need to offer a
63% of job seekers consider the benefits package a top priority when considering taking a new role with a particular company. So if you want top talent, you need top benefits. - Gives your business a competitive edge – Almost one-quarter (23%) of workers don't receive any benefits from their employers, while only 61% of those who receive benefits are satisfied. So stand out from the competition by offering existing and prospective employees a package they can get excited about.
- Enhance employee satisfaction – Some benefits and perks, such as wellness plans and paid leave, can help create an attractive work-life balance for your staff, preventing low employee engagement and burnout.
- Lower employee turnover – Great employee benefits packages are one of the best ways to acquire staff and also keep them happy and loyal in their roles, with nearly 80% saying they'd accept competitive work benefits over a pay rise.
- Reduce overall cost – Benefits packages that retain employees help organizations avoid additional costs associated with hiring, onboarding, and training.
Benefits drive employee satisfaction and aid in creating a higher-performing workforce and environment that people want to be a part of.
Top 7 Employee Benefits For Employee Retention
Before creating or overhauling your benefits package, it's important to understand the reason behind your high employee turnover. Conduct surveys or interview workers leaving as well as those retained. Gather useful information on what individuals like about your organization's benefits package as well as what may be causing the turnover.
While your company's demographics will have a significant impact on the perks and benefits your employees want, here are the most common and top trends that are valuable to employees across roles and industries:
1. Equal Paid Parental Leave
Although paid family leave often tops the list of the most coveted employee benefits a company can offer, and with 58% of employees considering it the leading perk if you want to extend it above and beyond with your package, ensure you create an inclusive package by offering equal parental leave.
Companies currently have a significant disparity between paid paternity and maternity leave perks, affecting how much time fathers spend with their newborns. An inclusive parental leave package catering to all families will help create a more welcoming work environment for existing and prospective employees.
This strategy alleviates the stress and anxiety of being a new parent to all workers. It also ensures both parents can balance their jobs and personal lives happily and satisfactorily. In addition, a recent study found that equal parental leave results in improved mental health and boosts career progression for individuals.
2. Flexible Work
COVID-19 has dramatically changed how people work. It has enabled and normalized remote and hybrid work models. Consequently, flexible work arrangements are the most in-demand work benefit today. Studies show that workers want flexibility in when and where they work. A recent study found that a staggering 98% of people said they'd like a remote work option, even part-time. And other studies have revealed that remote employees are 30-40% more satisfied and productive than their in-office counterparts.
In work environments where remote work is not feasible or with jobs that can't be done remotely, hybrid arrangements and flexible work hours allowing employees some days per week to work remotely or enabling employees to work during compressed work periods or traditional hours are popular. According to the Society for Human Resource Management (SHRM), 42% of companies that experienced enhanced turnover in 2021 have incorporated additional or new remote work or flexible work options to minimize turnaround.
Implementing flexible work arrangements demonstrates that your business caters to the varied needs of your staff. For example, working remotely is a great option for parents or caregivers, patients with chronic pain, or just an individual who hates commuting.
3. Employee Bonuses
Workers like to see some extra cash in their accounts. This makes bonuses one of the simplest and most effective ways to achieve employee retention and satisfaction. Bonuses can dramatically and positively impact employees, helping them feel encouraged and rewarded for their efforts and motivated to continue with high performance.
Some of the ways you can include bonuses in your benefits package include:
- Annual employee bonus – You can incorporate a bonus based on salary percentage for all employees, depending on how profitable the year was.
- Milestone employee bonus - You can award a milestone bonus directly linked to individual performance for those who meet a particular goal or metric.
- Spot bonus – You can implement a low-cost bonus to reward employees as gratitude for demonstrating some values, like when an employee stays past their time to help a colleague complete a time-sensitive task.
- Holiday bonus – These can include a festive season, a one-off cash bonus as a form of gratitude for a year of productive work
Offering bonuses in the form of monetary awards can help employees address any personal or financial stressors affecting their mental health.
4. Health Benefits
The quality of health benefits is often directly correlated with workers' satisfaction in the workplace. A survey by America's Health Insurance Plans (AHIP) found that 56% of US adults with health benefits from their employers say their health benefits are a top factor when deciding to stay or quit their current job.
Some of the health benefits you can offer include:
- Group health insurance: Traditionally, employers could select and buy a group health insurance plan. Employees had to choose if they'd like to be covered in their employer's group health insurance plan. This works best for employers with a large enough group of employees to minimize the coverage cost.
- Healthcare Reimbursement Arrangement (HRA): With HRA, employers can reimburse workers when they pay for eligible health expenses out of pocket or health insurance premiums.
5. Education Support and Funding
Helping your staff access learning resources is a great way to ensure your benefits package is as inclusive as possible. Not only are you empowering them to be better through upskilling, but their acquired skills and expertise, in turn, benefit your business in the long run.
You can create a learning budget for each individual, allowing them to freely spend on courses, books, workshops or seminars. This is an excellent strategy for employees who want to take short courses to build their knowledge around a specific area.
Alternatively, your company can also offer support through tuition funding for staff members who wish to study at a college or university. According to research, there are currently over 42.9 million Americans burdened by nearly $1.59 trillion in student loan debt. You could offer tuition reimbursement and loan repayment benefits to proactively address the problem. This support will also help employees who may not have had the opportunities or funds to study before getting a job.
These programs help reduce the financial burden on staff members and motivate them to pursue advanced courses and degrees.
With extra knowledge and skills, employees who pursue more education will benefit your business by adding value to their current roles. Investing in your employees' education and development is equally an investment in your business.
6. Retirement Package
Retirement benefits packages like 401(k) plans or defined employee benefits plans are increasingly crucial in retaining employees. Retirement benefits offer employees a retirement solution and safety net that allows them to enjoy life after their careers are ended. Most importantly, retirement plans allow people to live comfortable and sustained lives.
While programs like Social Security are availed as part of employees' retirement plans, most people value additional retirement benefits that enable them to save for their retirement years. Many employees rarely remember to save for retirement, but when offered a savings option and retirement plan, it helps them begin the critical step.
Organizations that don't offer employee retirement benefits are less likely to have employees who would want to stay at the company until they retire.
7. Tailored Perks
There is often no one singular benefit that appeals equally to all employees. So try to create benefits and perks packages tailored to appeal to your staff. In addition to offering the basics like flexible schedules, remote work, and good health benefits, you can offer your employees discounted gym memberships, cell phone service, car financing, travel costs, food, and more.
Whatever it is, be open with your employees about what perks appeal more to them. This will help you identify and resolve any issues or concerns your employees may have with the workplace.
Improve Employee Retention & Embrace Organizational Success
Whether you want to attract top talent or enhance your existing employees' satisfaction for better retention, evaluating your perks and benefits schemes is crucial for success in the current workplace.
Stop thinking about employee benefits as a requirement and look at them as employee recruitment and retention tools. A positive workplace where employees feel valued and cared for makes them want to stay. So if you want to give back to your employees or boost retention rates, you need to enhance your benefits packages and start dishing out competitive perks. With Inflection's comprehensive cloud-based benefits solution your business can have an easier time managing, distributing, and assisting your employees with their options for benefits packages. Contact us for more information.
