The U.S. unemployment rate fell to a record low of 4.3% this summer. With that level of competition, human resources managers are struggling to find top caliber talent. Companies need innovative ways to attract quality candidates, one of which is to offer compelling job benefits.
In a Glassdoor survey, around 60% of respondents reported that they strongly consider perks and benefits offered before accepting a job offer. In addition, 80% of employees prefer additional benefits over a pay increase. Studies show that a competitive benefits package can significantly help in employee acquisition and retention. In this article, we'll show you the top 5 types of benefits that can increase applicants.
1. Flexible Work Hours
A study by Fractl reveals that flexible hours can influence 88% of respondents to choose a job that offers a lower salary over an opportunity with a higher salary but a fixed schedule. In fact, according to Harvard Business Review, after health insurance, a flexible schedule is the top requested benefit.
Flexible hours is one of the top priorities of today's job seekers in terms of benefits. Source: Harvard Business Review
Flexible work hours and work-life balance are particularly popular among two subgroups: millennials and parents. According to FlexJobs, around 8 out of 10 parents polled chose flexibility and work-life balance as the most important factors in a potential job opportunity.
Netflix is an industry leader when it comes to offering flexibility to their employees. The in-demand media streaming company offers unlimited vacation time. No one tracks employee time off. Rather, the company trusts its employees to use their judgement to take time off when they need to as long as they are productive while at work and meet performance objectives.
Unlimited vacation time is a concept that doesn't work for everyone. In some cases, employees can actually be discouraged from taking vacation time if there's no formal time off policy. However, you can offer more flexibility by allowing employees to work from home once a week, taking every other Friday off, or letting them choose their own hours as long as work gets done. You can also let employees work from home. Arrangements like these are generally accepted in the tech industry, but more small businesses are now adopting them as well.
[Related: Download Glassdoor's eBook, Effectively Managing Employee Paid Time Off, to find everything you need to know to design a vacation policy that draws top talent while keeping current employees energized, engaged and happy.]
2. Medical, Dental & Vision Insurance
Employers who help employees feel secure by offering health insurance will benefit by attracting more and better candidates. Employees carefully consider health insurance that helps them cover themselves and members of their immediate family. The average American paid a total of $10,345 in 2016 in health care costs. The astronomical cost is probably one of the main reasons why 95% of employers surveyed by (SHRM) chose health care benefits as the most important to a majority of their employees.
Unfortunately, health insurance can be the most expensive perk for an employer to offer. On average, companies pay $6,435 annually per employee for individual coverage and $18,142 to cover the whole family. The good news is that small businesses can offer health insurance without shouldering the cost of the entire premium. They can pay a portion of the monthly premium to make their expenses more manageable. Considering the annual health insurance costs, employees will most likely appreciate any assistance provided to them by their employer.
Most important benefits to employees according to employers. Source: SHRM
[Related: For a comprehensive overview of benefits options and which ones are most appealing, download Glassdoor's eBook, The Benefits Employees Want Most.]
3. Retirement Benefits
According to a report by Merrill Lynch, the total cost of retirement is over $730,000! So, it should come as no surprise that offering a retirement plan can strengthen your employer brand and increase the number of applicants.
Most companies offer a traditional 401(k) plan as an employee benefit. Source: SHRM
A SHRM survey revealed that 90% of companies offer a traditional 401(k) or similar plan to help employees plan for retirement. Under this plan, the company can offer to match some portion of the employee's salary. Many companies match dollar-for-dollar the first 3% of the employee's salary and then 50 cents on the dollar for the next 2%. Retirement plans are a popular employment benefit as both business owners and employees get tax breaks whenever they make contributions.
4. Group Life Insurance
Employees with life insurance feel secure that their families will be taken care of financially in case they pass away. A LIMRA survey conducted in early 2017 revealed that nearly 6 out of 10 employees state that life insurance benefit was not only important, but also essential in their work.
While many companies offer life insurance, nothing tops what Google offers. The company itself offers their own version of life insurance to employees. In an event of death, the employee's spouse receives 50 percent of employee's salary for 10 years.
Fortunately, you don't have to be on a level with Google to offer life insurance because group life insurance is one of the most cost efficient benefits that an employer can provide. For example, employers pay only $36 per month to cover a 40-year old employee in good health. This is an inexpensive benefit that can help round out your benefits program to attract top talent.
Offering life insurance may be the one thing that causes a job seeker to choose your company over the competition. It gives employees peace of mind - even if they wouldn't have thought to purchase it themselves.
5. Wellness Programs
More and more employees are now paying attention to their overall wellbeing. This is why many companies today include wellness programs as part of their benefits package. In fact, 88% of CEOs surveyed by Fitbit claim that their company already has a health and wellness program.
Business analytics leader SAS is ranked number 15 by Fortune Magazine's 100 Best Companies. Some of the things that propelled the company to the top of the list are the onsite fitness center and discounted gym memberships.
As a small business owner, it may be beyond your budget to build an onsite gym. However, you can still offer wellness programs to your employees by providing the following:
- Healthy snacks
- Yoga classes
- Meditation classes
- Discounted or free gym memberships
- Athletic gear reimbursement
Companies prove that corporate wellness is not just another buzzword. Source: Fitbit
[Related: To learn how to build your company's wellness program to be a sound investment for cost savings, facilitating recruiting efforts, and increasing employee engagement and retention, download Glassdoor's Employee Wellness Playbook.]
With companies struggling to acquire top talent, many look at their benefits package to help attract more candidates. Research shows that competitive perks can be enough to sway applicants away from higher paying jobs. Boost your pool of applicants by offering these top 5 benefits: flexible schedules, health care insurance, retirement planning, life insurance, and wellness programs. For a comprehensive overview of benefits options and which ones are most attractive to candidates, download Glassdoor's eBook, The Benefits Employees Want Most.
Evan Tarver is a small business and investments writer for Fit Small Business, fiction author, and screenwriter with experience in finance and technology. When he isn't busy scheming his next business idea, you'll find Evan holed up in a coffee shop working on the next great American fiction story.
How effectively you retain top talent matters to the health of your business. To get involved in the conversation on Glassdoor and start managing and promoting your employer brand reputation, unlock your Free Employer Profile today.