Need to know:
- Potential employees are now keen to know what benefits an employer offers in addition to salary, especially within the context of work-life balance.
- Bespoke packages and more flexibility are key factors in successfully appealing to employees with diverse needs and expectations.
- Employers are increasingly aligning benefits strategy with their culture and values in order to create an attractive employee value proposition.
The 2019 Salary guide, published by Robert Half in October 2018, found that 82% of UK hiring managers have struggled to find qualified professionals, and 78% have been unable to secure them in the role.
While a competitive salary and job security are still high priorities for job seekers, in today’s fast-paced work environment, many candidates are looking for an attractive package that supports their work-life balance.
Meanwhile, if the day-to-day culture and environment of an organisation is not a good fit on an ongoing basis, an enticing pay packet will only work as a retention factor for so long, particularly if others are able to offer both.
In an environment where talented individuals might receive numerous job offers, comparable in terms of location and salary, can a benefits package offer an attractive differentiator?
Benefits to recruitment
Employee benefits can play a significant role in the recruitment process, says Chris Lawton, director at Robert Half. “Increasingly, people are taking into account the overall package and not just the salary when making a decision," he explains. "When we talk to candidates about roles, a common question is, ‘what package is on offer?’, whereas in previous times the question might have been ‘what does the role pay?’”
The What workers want report, published by Hays in June 2017, found that factors other than salary were becoming increasingly important when employees were considering a job move: 61% would consider taking a pay cut in exchange for their ideal benefits package; 58% would take a reduction in salary of more than 10% in order to work for an organisation that offered an engaging culture; and 84% would consider an employer’s flexible-working policies when deciding whether to apply for a job.
Employers are shifting their approaches to offering bespoke opportunities, says Chris Andrew, client partner director at Caburn Hope. “There’s a trend to create jobs around key skills and experiences, rather than fitting people into a job title within a structure," he says. "Because of that, reward and benefits need to allow for that shift and that change.”
Benefits and the employer brand
This, arguably, presents a challenge for employers, because benefits packages have traditionally been focused on a more standardised, cookie-cutter offering that is becoming less desirable as the perks themselves become more the norm.
Now, employers that invest in moving beyond the off-the-shelf products have the opportunity to leverage a bespoke, unique benefits package as a valuable tool in promoting the brand and values of the organisation.
“There is opportunity to think creatively about how the benefits that you as an employer can share, that they echo your ethos and your attitude, and the behaviours that you’re looking to drive and the kind of culture that you have," says Andrew.
Increasingly, individuals are also more focused on working with an employer with values that align with their own. This means that benefits can be used to showcase not only an organisation's care for its staff, but also its impact on the wider world, taking into consideration social corporate responsibility and sustainability, for example.
While benefits are unlikely to be the sole reason an employee takes or remains in a role, when presented alongside factors such as engaging work, a positive organisational culture and ample opportunities to develop, they can make for a powerful retention tool.
“If [an employer] offers great benefits packages to its employees, it enhances the culture, and creates a better feeling about working for that [organisation]," says Lawton. "[It is] much more likely to keep [staff] retained if its benefits package is competitive and accommodates someone’s needs."
It is no longer a question of simply ensuring staff are earning enough to live, but helping them feel fulfilled and balanced both in and outside of work, says Lawton. This might be both the secret to presenting an attractive brand to prospective staff, and ensuring existing employees feel valued, supported and free from the dangers of burnout.
Nick Throp, director and co-founder of Like Minds, adds: “Some of the most interesting things we’ve seen around the differentiation of benefits would be those organisations which have really tried to understand what the challenges and opportunities are that their people have in their lives, and how [they can] help people to achieve those life goals, or overcome the challenges they’ve got. So it feels very real and authentic.”
Power of communication
The influence that a benefits package can have on the attraction, recruitment and retention of an employee may well come down to how well it is communicated and presented.
A key factor is to understand the drivers and motivators of the individual, says Throp. “Within most populations there will be a situation where not only benefits as a whole will have a different significance and relevance to different parts of that population, but also elements within that benefit package are going to be of different value to whether you’re recruiting them, or retaining them,” he explains.
So, in addition to the varying wants and needs of different demographics, the approach to promoting benefits as part of an effort to recruit new talent might differ from the methods used to leverage benefits as part of a retention strategy.
Employers should be wary, for example, of those perks that most forget to highlight, but that can have a significant effect at the recruitment stage.
Jack Curzon, consulting director at Thomsons Online Benefits, says: “Lots of [employers] are doing loads of things already that they’re not communicating well. Things like development, staff training, and formal qualifications, but they don’t necessarily think of that as a benefit. People should understand that it’s part of working at an organisation.”
The whole package
Employers can also enhance the attractiveness of their offering and showcase the package to its full effect if they convert the value of benefits to a total value, says Michael Rose, director at Rewards Consulting.
“If [an employer] wants to maximise the value of benefits at recruitment, then it should provide people with a total value statement," he explains. "Make it very clear, and communicate very well what the salary’s worth, [with] bonus and benefits. Simply doing that can help [an employer] enhance the value of benefits as perceived by a potential employee.”
For benefits packages to continue to be an important factor in the attraction and retention of employees, organisations need to change how they are positioned. "Benefits have almost become so established that people just expect them, there’s a culture of expectation and people don’t necessarily value them, but they’ll notice when they're gone" says Andrew.
"This is difficult when [an employer] is trying to use [its package] in order to differentiate itself. That’s why the connection to its story as a business, what it stands for and what people can do, all fits within the context of what is a benefit of working there."
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