Benefits Help Attract and Retain Better, More Engaged Employees
While we continue to live in a world where our well-being is often tied to money, employees today have made it clear: employee benefits are now more important than a higher salary.
Two recent surveys from The Harris Poll for the American Institute of CPAs and Glassdoor.ca echoed the same results, with 4/5 respondents to The Harris Poll saying they’d prefer benefits to a job with 30% more salary but no benefits and 79% of Glassdoor.ca respondents prefer benefits over a higher salary.
So, what is it that’s driving the value of perks over more money?
Competitive Landscape, Desire for Less Stress
For Canadian businesses, getting the best people to join their company is a competitive process. Most top talent likely receives numerous offers from recruiters on an ongoing basis, making the opportunity for them to bolt for greener pastures that much easier. Nowadays, employee benefits like health, dental, and vacation have become a baseline standard that quality employees have come to expect.
Aside from this, today’s employees tend to want a less-stressful lifestyle – and businesses that best facilitate this through their total compensation package become the most attractive to work for.
Total Compensation, Not Salary, the Driving Force
The perks of employee benefits have long been acknowledged by both employers and employees. But the widespread idea of salary being less important than benefits as part of a total compensation is new.
For employers, the gain of offering benefits over a higher salary makes business and financial sense.
Attract Better Talent to Grow Your Business
Offering lucrative total compensation is key to attracting the best talent because the smartest people aren’t driven by money, but meaning. With meaning at the center of what propels top talent to accept a job offer, then, an easy way to prove a job will have meaning is to show that a company cares with a generous employee benefits package that includes total compensation, not a higher salary.
Benefits a Better Predictor of Job Happiness, Retention
On the flip side, companies that offer employee benefits – including health and dental, vacation, flexible schedules, critical illness benefits, partner support, and more – over higher salaries create workplaces that keep people happier. And happier employees stick around more often and are more productive.
Benefits a Major Factor in Accepting Job Offers
Another highlight from the Glassdoor.ca survey was 60% of their respondents saying they strongly consider employee benefits before even accepting a job offer.
Employee Benefits Costly, But Lead to Major Savings
But that begins to raise the question: as attractive as employee benefits are to employees, does it truly make financial sense for an employer to offer benefits over a higher salary or salary raise?
To this point, the Conference Board of Canada reported in 2015 that the rise of chronic diseases and mental health issues has led to employers having to shift their focus to health education, awareness, and prevention as part of an employee benefits cost management strategy.
However, despite the Conference Board’s focus on the cost containment of benefits spending, the positive impact of benefits can’t be disputed. With 29% of employed adults considering switching jobs, according to The Harris Poll survey, losing good talent who jump ship to another business can cost an employer 16%-20% of a salary to replace – with the total cost somewhere in the 100%-300% range.
So, while putting together a higher salary offer instead of a total compensation package that includes employee benefits may save costs in the short-term, at what cost overall? The loss of a high-quality candidates, fewer quality candidates retained, and an unhealthy and unproductive workforce?
Whether your business is considering health/dental and employee benefits insurance, or critical illness benefits and wellness programs, ensuring your employee benefits are effectively managed is critical.
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