Benefits, what do employees want?
A generous and diverse benefits package is necessary for attracting talent in today’s hiring market. Not only is it a great way to attract the best candidates, it’s also a key in helping to retain them. A recent study conducted by Kerry Jones for Forbes found that about 60% of people surveyed considered benefits and perks a major factor in accepting an offer, and that 80% would choose better benefits over a pay raise.
Some of the companies more extravagant perks include lunches made by a professional chef, massages, yoga classes, haircuts, acupuncture and improv classes. Some larger companies have even stretched to include a college scholarship program for employee’s children. Smaller companies have gotten creative by offering vacation expense reimbursement, free books and free lunch on Fridays. In another survey of small businesses conducted by Fractl, analysts found that after health insurance, employees value flexible hours, more paid vacation and options to work from home.
As part of the Fractl study, they gave 2,000 U.S. workers, ranging in age from 18 to 81, a list of benefits and asked them how they would rate them when deciding between a high-paying job and a lower-paying job with more perks. These findings are shown below:
Better health, dental, and vision insurance topped the list, with 88% of respondents saying that they would give this benefit “some consideration” (34%) or “heavy consideration” (54%) when choosing a job. Health insurance is the most expensive benefit that companies provide to their employees.
Second on the list reported that flexible hours, more vacation time, more work-from-home options, and unlimited vacation time could help give a lower-paying job an edge over a high-paying job with fewer benefits. The research also shows that flexibility and work-life balance ranks higher than salary and health insurance. Despite this trend, I was surprised to learn that American workers leave a huge amount of unused vacation time on the table. A huge liability results when the employee leaves the company and their employer must pay out that vacation time. Some companies have resorted to an “unlimited time-off” policy which can save the company about $1,898 per employee. The benefit had been offered mostly by smaller firms but in 2015, General Electric, the multi-billion-dollar company, announced a new policy that would effect 30,000 of their employees to no longer limit the number used on vacation, sick, and personal days(CNN.com). Currently only 1-2% of companies offer this benefit which makes them more attractive to job seekers.
Student loan and tuition assistance also ranked highly on the list of coveted benefits. A benefits survey from SHRM found that only 3% of companies currently offer student loan assistance, and 52% of companies provide graduate educational assistance. Although education assistance sounds costly, companies can take advantage of a tax break; and offer up to $5,250 per employee per year tax free.
Gender differences in benefits were also highlighted in the survey results below. More women (24%, and only 14% of men), were likely to prefer family benefits like paid parental leave and free day care services. Men valued team-bonding events, retreats, and free food over woman. The biggest variance between the value of what perks would sway them was work-from-home options, which women valued more, and actually the second best perk they valued over a high-paying job (55% women, and 40% men). Both genders valued fitness-related perks such a free fitness classes, gym memberships and onsite gyms.
Benefits that impacted lifestyle and finances were among the most coveted. This doesn’t mean that the benefits are valued by employees, but that the perks aren’t enough to make a candidate choose one job over the other. Research suggests that providing the right mix of benefits that are both inexpensive and highly sought can give companies looking to hire a competitive edge making them more attractive to job seekers.