How Leaders Should Think About Employee Benefits When it comes to employee benefits, one size does not fit all.
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As the seismic shifts caused by the Great Resignation continue to reverberate across the workforce, employees everywhere are looking to make a change motivated primarily by companies offering better compensation, including benefits.
Record numbers of workers left their jobs in 2021. And, as the year came to a close, Ceridian's annual Pulse of Talent report found that as many as one in four workers were still actively seeking new jobs.
The modern workforce is no longer willing to sit back and accept subpar benefits, with the demand for better compensation packages serving as the driving force behind many resignations.
It is time for leaders to transform their thinking and to look at employee benefits with fresh eyes — where are they falling short, and how can they do better? And, most importantly, what do their employees truly want?
Make benefits consumer-driven
To support a modern workforce, employee benefits must be consumer-driven. The needs of today's employees are no longer one-size-fits-all. From geographical locations to generational differences, each employee brings a unique set of circumstances that employers need to address.
Cater to the needs of your employees in the same way you might when attracting new customers to your business. Furthermore, using analytics can help foster a better understanding of your employee's needs. Implement regular surveys to gauge employee satisfaction and adjust your benefits and wellness programs accordingly.
According to a 2021 study by MetLife, 93% of employees said that the ability to customize their benefits packages is a "must-have" or "nice-to-have." With a consumer-driven approach to benefits, leaders can offer customization with flexible benefits that cater to employees' individual circumstances and empower them to make the choices that are best suited to their lives.
It is time to move away from the blanket approach to benefits. If companies want to attract and retain the best talent, they must listen to employees and give them the flexibility and options they desire.
Related: The Basics of Employee Benefits
Thinking beyond medical, dental and vision
The changing nature of the workforce has created new challenges to which companies must adapt. Companies can no longer get by with only offering the standard medical, dental and vision benefits. In 2022, people want to work at companies that cater to the whole person — companies that understand employees have a life outside of the office and a wide variety of responsibilities they are trying to balance.
Employers should provide a greater menu of benefits, including such things as wellness programs, mental health support and pet insurance. Employers should also take into account the quality and accessibility of services in an employee's geographical location, and the different stages of life people may be in (like marriage, new family, student and retirement).
The remote worker, for example, probably does not need commuter benefits, but they may enjoy online wellness programs that connect them with their co-workers. Similarly, a new parent might need more flexible hours or a childcare subsidy, while an intern in graduate school would value an education stipend.
No two employees are the same, and leaders should not treat them as such. The modern workforce is a hybrid of different ages, locations and experiences; companies need to offer benefits packages that can accommodate such variety.
Gaining the competitive advantage through robust benefits packages
Finally, robust, flexible benefits packages cannot be considered secondary motivators in recruitment — they should be at the forefront of the hiring process. The effects of the pandemic have highlighted the need to offer customized benefits with flexible options to potential employees.
In many ways, businesses are dealing with an employee's choice market, but employers can gain a competitive advantage over other companies by offering attractive benefits. Employees aren't looking for mere perks with bean bags in the break room or free sodas in the vending machines. They want lasting, impactful value to be added to their personal lives through employment, and benefits are an efficient pathway toward providing that value.
Providing benefits is no longer a simple box to tick on a to-do list. The basics — medical, dental and vision — are table stakes in the post-pandemic game. To win, employers must up the ante by identifying what all of their employees want and offering bespoke plans unique to their individual needs.
A new way of thinking
The shift toward offering robust benefits packages has been coming for a long time, but the Great Resignation has accelerated the need to rapidly adopt a new way of thinking about benefits. Employees invest in a company when they accept a new position, and they may not invest if they do not believe they will see an equal return of value to their own lives.
Companies that treat their employees as whole people by taking a consumer-first approach to benefits through providing diverse options that cater to the specific and complete needs of each employee are the most likely to see higher employee satisfaction and greater retention of top talent.
Gain the competitive advantage not by offering one-size-fits-all coverage to everyone, but by providing a menu of unique options that give each individual agency and flexibility in their choices.