In a competitive recruitment marketplace, what an employer has to offer its employees in terms of benefits can make the difference in whether or not a candidate accepts an offer or the company retains an employee. No longer is it the case that salary is the focal point of total compensation. Employers are creating more attractive benefit packages and investing more into total compensation. A recent study by Glassdoor, a growing employment-related website, found that four out of five employees prefer new and innovative benefits in lieu of a pay raise.
Innovative Employee Benefits
That being said, what are the benefits in which employers should invest to attract and retain talent, increasing the likelihood of higher job satisfaction? Where can an employer realize the greatest benefit (no pun intended!) for their investment? The Glassdoor study looked at five key benefit types: health insurance, paid time off, 401(k) retirement plans, employee discounts, and maternity/paternity leave of absence.
The results of the study yielded a couple primary findings. First, core benefits still matter. Of the benefit types considered in the study, the three that increased the level of employee satisfaction the most were health insurance, paid time off, and 401(k) retirement plan, with quality employer-provided health insurance far and away the most significant benefit affecting employee satisfaction. All three of these are benefits that can be enjoyed by the entire employee population and typically staples of a total compensation package.
Secondly, on the other hand, employee discounts and maternity/paternity leave did not have a statistically significant effect on employee satisfaction. This is likely due to the relatively small population of employees who fully utilize these two benefits at any given time. Although maternity/paternity leave has enjoyed growth in organizations over the years, this benefit simply is not a driver of employee satisfaction because of its use by a limited population of employees. Just as well, employee discounts, although widely used by employees when available, are perceived as a lower value benefit in relation to the other benefits in the study.
Employers are up against tough decisions when considering the benefits in which they elect to invest. What it comes down to is the value their employees receive from a particular offering. While enhancing the total compensation package with flexible benefit options is never out of the question, companies must focus on what they perceive to be the benefits that matter the most to their employees – those which provide employees with the most value.