Selecting the right employee benefits package is crucial for attracting and retaining top talent in today’s competitive job market. With the war for talent in full swing, companies need to understand what benefits employees value most when considering a job offer or deciding whether to stay at their current employer. According to recent surveys and studies, the most sought-after employee benefits are health insurance, retirement plans, and paid time off.
Health Insurance
Health insurance consistently tops the list as the most desired workplace benefit. With healthcare costs continuing to rise, employees highly prioritize comprehensive and affordable medical coverage. They want access to quality care without breaking the bank. Most employees rank health insurance as the single most important factor in their benefits selection.
Some key statistics on the popularity of health insurance benefits:
– In a Glassdoor survey, health insurance was chosen as the most important benefit by 67% of employees.
– 88% of employees say health insurance is a must-have benefit, according to a Bankrate survey.
– 50% of millennials identify health insurance as a deciding factor when considering a job offer, per a Qualtrics study.
The COVID-19 pandemic further amplified the importance of employer-sponsored health insurance. With so much uncertainty and anxiety around health and safety, robust medical plans became even more of a priority for workers.
Employers need to provide inclusive health insurance that covers hospital stays, doctor visits, prescriptions, and other essential medical care. Low deductibles and copays are attractive to team members as well. Supporting physical, mental, and behavioral health is also key. Wellness programs, employee assistance programs (EAPs), and telemedicine options are popular extras.
Retirement Plans
Second only to health insurance, retirement benefits like 401(k)s and pensions rank very highly among employee priorities. With increasing life expectancies, rising healthcare costs, and instability in government programs like Social Security, workers know they need to self-fund a significant portion of their retirement income. Access to employer-sponsored retirement plans provides them with an easy, tax-advantaged way to save for the future.
Here are some compelling statistics on the demand for retirement benefits:
– 73% of employees see retirement benefits as pivotal in their decision to accept a job, according to a Transamerica Center for Retirement Studies survey.
– 55% would rather have stronger retirement benefits than a higher salary, per a Bank of America report.
– 82% of millennials rank 401(k)s as a top benefit, says a study by human resources association SHRM.
Ideally, companies offer both defined benefit pension plans and defined contribution options like 401(k)s and 403(b)s. Matching employee contributions to retirement accounts is highly valued. People are looking for the full package: a generous company match, low vesting periods, wide investment fund selections, high contribution limits, and top-notch plan administration. Educational resources to assist with retirement planning are icing on the cake.
Paid Time Off
The number of paid vacation days, sick days, and personal leave allotted per year comes in third among the most coveted employee benefits. Time away from work to rest, recharge, and tend to personal needs ranks high across age groups and industries. In fact, paid time off is almost as prized as health insurance and retirement plans, based on employee surveys.
Let’s look at why paid time off has become so important:
– Millennials are the most vacation-deprived generation ever, getting only around half the time off that baby boomers enjoyed. This makes them value PTO even more.
– With careers increasingly 24/7 and boundaries between work and life blurred, workers crave guaranteed breaks from their jobs.
– High stress levels make having paid time to decompress critical for mental and physical health.
– Time away allows people to fulfill personal responsibilities, pursue hobbies and passions, and spend time with loved ones.
The amount of paid time off being offered is a key recruitment advantage. Best-in-class PTO policies provide at least three weeks of vacation, 10 sick days, 5 personal days, and generous parental leave. Unlimited vacation is a growing trend led by technology companies trying to entice top talent. But even employees at companies without unlimited vacation most value the security of defined PTO plans.
Company Culture
In addition to the top 3 benefits above, company culture is emerging as a highly-desired component of an overall compensation package. While not a benefit per se, culture can be a key factor in attracting and retaining the very best employees. Things like leadership, values, environment, work-life balance, training, diversity, and a sense of purpose all contribute to a positive corporate culture.
Some revealing statistics on the rising importance of company culture:
– 92% of job seekers say culture is important in a job search, according to a Muse survey.
– 70% would rank culture above compensation in taking a job, per a Comparably study.
– 63% won’t apply to a company with a bad reputation, even if unemployed, says a Brandon Hall Group report.
A favorable culture provides meaningful work, autonomy, flexibility, and collaboration. Perks like office amenities, employee engagement initiatives, diversity programs, and CSR initiatives also contribute to an appealing environment. With Gen Z entering the workforce, culture will likely overtake benefits in job selection criteria within the next decade.
Flexible Work Options
Employees today expect and demand more schedule flexibility and remote work options. The pandemic accelerated the work-from-anywhere transformation. With talent dispersed and reluctant to go back full-time to inflexible in-office routines, flexible work has become a must-have benefit. Employees are seeking options like:
– Hybrid remote/in-office schedules
– 100% remote work
– Flexible hours outside a standard 9-5
– Job sharing
– Part-time or compressed schedules
Research shows the appeal of workplace flexibility:
– 55% would turn down a job that didn’t offer flexible work, per a Buffer survey.
– 75% say schedule flexibility is a top priority post-pandemic, says a Mercer study.
– 83% feel flexibility improves work-life balance, according to FlexJobs.
Offering flexible work models allows companies to tap into talent pools worldwide. It also aids diversity, equity, and inclusion efforts by enabling people like single parents and those with disabilities to excel in roles not tied to rigid in-office requirements. Publicizing flexible work options helps attract candidates who desire greater work-life harmony and autonomy.
Professional Development & Training
Employees today want opportunities to continuously develop new skills rather than remain stagnant in their roles. Professional development programs and training benefits allow people to expand their capabilities and maintain competitive resumes. Tuition reimbursement, learning stipends, and development courses are popular upskilling perks.
Let’s examine what employees say about the need for development opportunities:
– 93% consider learning opportunities important when evaluating a job offer, according to a LinkedIn survey.
– 88% believe professional development benefits positively impact job satisfaction, per a Modern Survey.
– 57% would consider finding a new job if they weren’t learning new skills, says a Pearson report.
Employers should cover the costs of external training, conferences, certification programs, and higher education related to employees’ roles. Internal development resources like mentoring, stretch assignments, and speakers also help people continually progress. Leadership training, continuing education stipends, and tuition reimbursement are especially prized.
Investing in robust professional development yields an upskilled, future-fit workforce able to move up the career ladder internally. It also boosts retention by providing stimulating work environments and demonstrating a commitment to employee success.
Wellness Programs
Wellness benefits that support employees’ physical, mental, financial, and social health are growing in popularity. Workplace stress is at an all-time high, and employees expect help cultivating healthier, more balanced lifestyles. Wellness programs boost recruitment, engagement, productivity, and retention.
Some examples of wellness benefits companies can offer:
| Physical Wellness | Gym memberships, fitness challenges, yoga/meditation, ergonomic equipment, walking breaks |
| Mental Wellness | Mental health days, counselling benefits, mindfulness classes, resilience training, mental health first aiders |
| Financial Wellness | 401(k) matching, student loan assistance, financial planning resources, discounted financial services |
| Social Wellness | Volunteering programs, diversity initiatives, employee resource groups, team building activities |
Key wellness statistics:
– 51% would trade an increase in salary for better mental health benefits, per mindbeacon.
– Employees are 3x more likely to stay at companies with wellness programs, says Bank of America.
– 78% believe their employers should support overall well-being, according to Virgin Pulse.
Wellness benefits demonstrate an organization’s commitment to caring for the whole person, not just the employee. Comprehensive wellbeing programs also help control rising healthcare costs that accompany issues like obesity, chronic disease, addiction, and mental health disorders.
Paid Family Leave
Paid family leave has quickly risen from a niche offering to a mainstream must-have benefit. Employees today expect time off to welcome a new child, care for a sick family member, and manage other significant life events. Paid family leave promotes health, bonding, caregiving, and financial stability for workers during important times.
Here’s a look at why paid family leave matters:
– 87% of employees say family leave greatly influences job choice, per Comparably.
– 88% of organizations say family leave enhances retention, according to SHRM.
– Paid leave increases worker productivity and revenue, reported an EY study.
New parents often need at least 12 weeks paid leave for bonding and infant care. Employees caring for sick spouses, partners, parents, or children also require several weeks of paid leave for appointments and caregiving duties. Flexible transition periods are additionally valued. To attract and retain top talent, employers must champion family-first values through robust leave offerings.
Work From Home Stipends
With remote and hybrid work here to stay in many industries, employees expect help funding their home offices. Work from home stipends provide a set dollar amount each month to cover home office expenses like internet, furniture, equipment, and supplies. Typically ranging from $50 to $200, these stipends help defray the costs of telecommuting.
Let’s examine why work from home stipends are trending:
– 43% want stipends for remote work costs, says a Buffer survey.
– 65% say stipends would make remote work more accessible, according to a Global Workspace Association study.
– Workers with home offices are 30% more engaged, per a study by psychosocial science organization i4cp.
Direct stipends put the purchasing power in employees’ hands to configure home setups that fit their preferences and needs. Stipends save companies office space expenses and demonstrate that they trust employees to make smart buying decisions. Their popularity will continue to grow as hybrid remote work dominates.
Employee Equity
Employee stock options or equity give workers actual ownership stakes in the companies where they work. This creates aligned incentives between staff and the overall business. Employees who receive shares of company stock or equity options tend to feel more invested in their work and committed to the organization.
Some stats on the appeal of equity benefits:
– 53% of employees say equity compensation motivates them to work harder, per Carta.
– 14% higher retention rates are achieved when equity plans are offered, says a Palo Alto Software study.
– 90% of startups use equity packages in hiring, according to Index Ventures.
– Employee equity helps employers attract scarce high-tech talent in fields like engineering, cybersecurity, and data science.
Equity usually vests over 3-5 years to promote longevity. Offering equity demonstrates a company’s desire to share success and rewards with employees who help build business value. With workers seeking deeper meaning in their jobs, equity programs foster engagement by literally giving employees a stake in the company’s growth.
Conclusion
In today’s ultracompetitive hiring landscape, employee benefits packages can make or break talent attraction and retention efforts. Candidates are shopping around for the best benefits, from health insurance to equity. To engage and retain top talent, leading companies optimize their benefits offerings around the most sought-after perks.
Health insurance still tops the list as the most desired benefit. Retirement plans and generous paid time off round out the coveted top three. But the popularity of culture, flexibility, development opportunities, wellness, paid family leave, work from home stipends, and equity underscore the diversity of benefits now influencing job decisions. The most successful companies take a holistic approach in crafting benefits that support physical health, financial security, work-life balance, family needs, personal growth, and professional purpose.