As of October 2019, the US unemployment rate is 3.6% and has been steadily holding since then. This rate is the lowest it has been since 1969. Economists report that the US economy is nearing full employment, so anyone who wants a job in the country has one.
These metrics are significant for businesses in the country, specifically small businesses. Finding qualified employees is as competitive as ever, simply because fewer people are looking for jobs out there.
Not only do you want to attract the best talent that is out there, but you want to hold on to the employees you have now. According to Career Builder, 32% of workers are looking to change jobs because of low wages or a lack of benefits and poor company culture. Benefits are one of the top ways to enhance employee satisfaction.
With all the numerous benefits out there, businesses, particularly small companies with limited budgets, are faced with the decision of which benefits are the best for their employees.
We’re here to share with you the most popular employee benefits out there and how they can resolve your HR needs.
Increase in Pay
Small businesses with just a handful of employees find that the cost and complexity of traditional benefits are too complicated or not in their budget, so they choose to raise employee wages.
Employees appreciate high wages; however, they can’t compete with other businesses that offer competitive salaries and traditional formal benefits. According to a Glassdoor study, an increase in pay has a direct effect on employee satisfaction but there is also a lessening return to happiness for every $1,000 in earnings. Additionally, when compensation is increased, employers hope that the employees will spend the money on benefits such as medical and dental benefits, but this is not always the case.
Companies who do raise wages as an attempt to get their employees to purchase benefits, find that their employees still believe their company does not offer benefits. Considering one-third of the workforce loses interest in a job due to a lack of benefits, it’s no surprise two-thirds of employees admit they would leave their job if they were offered a position with enhanced benefits. If traditional benefits are not in your budget, increasing wages is an alternative that you might want to consider. It might not be as great as the other benefits out there, but it’s still a way to attract top talent versus offering lower pay without any benefit offering.
Medical Insurance
As you may know, healthcare is costly. The average American cannot afford insurance straight out of their pockets in some regions. Medical benefits offered to the employee from the employer are almost a necessity these days- especially to those employees with families. Healthcare has always been important to people but with the rise of healthcare expenses, many employees find it nearly impossible to live without.
The United States spends 3.5 trillion dollars on healthcare expenses each year. The most frightening fact is that this rate is 12,300% higher than what it used to be back in the 60’s- and it continues to rise. Employees today are searching for jobs that offer medical benefits so they get that peace of mind that if something were to happen like getting injured or ill, they will have a plan in place and won’t have to worry about a huge medical bill that will put them in debt forever.
Retirement Benefits
Most people don’t want to spend their entire life working. That is why we look forward to retirement. However, retirement is nearly impossible if you don’t have the funds when you choose to stop working. The most popular retirement benefit is a 401(k) plan. A 401(k) plan is a tax-advantaged, defined contribution retirement account offered by many employers to their employees. Upon retirement, the employee will gain access to the funds in the account that collected over the years. Similar to health insurance, enhanced retirement benefits will have a positive impact on boosting employee satisfaction.
Lifestyle Savings Account
Believe it or not, after offering employees a competitive salary, medical benefits, and maybe even a 401(k) plan, several employees are still unsatisfied. This dissatisfaction is a result of the high cost of living in today’s world. According to The Bureau of Labor Statistics, data shows that what would have cost $20 in 1999 would cost nearly $31 in today’s world. Financial obligations such as rent, cars, insurance, health insurance, and more are all more expensive than they were just two short decades ago. Additionally, millennials (who make up most of the workforce today) have the most student debt, unlike in the history of the US has ever seen before.
So, why does this matter? While you can’t pay every employee’s rent, car payments, or other living expenses, you can offer them additional benefits that help reduce costs in other areas. For instance, after an employee pays all of their monthly financial obligations, they are left with little spending money for activities they enjoy. This deficiency is where a lifestyle savings account comes in.
A lifestyle savings account is an employer-funded account. Employees can use the funds in this account to pay for anything the employer believes will help them to have a more enjoyable lifestyle. So, for example, that employee that just worked their tail off last month can now treat themselves to a spa day with their LSA account. Or, the parent who desperately needs daycare so they can focus at work, can now afford it thanks to their lifestyle savings account.
Lifestyle savings accounts are a great benefit to consider if you are looking to boost productivity in the workplace. With lifestyle savings accounts, your team can now enjoy what they love most outside of work, so when they come to work, they are relieved and ready to work. Additionally, with a lifestyle savings account, you’re more likely to see better employee retention rates because why would anyone want to leave a company that offers a competitive salary, maybe some medical benefits, and that provides them extra money that contributes to their happiness?
Get Started With Lifestyle Savings Account’s
Don’t waste another minute without offering your team a lifestyle savings account. This account is a new benefit that has been an enormous trend in Canada and other countries, and employers have just started catching onto this trend in the US. Now’s your chance to stick out from the crowd to attract the top talent out there! Ready to get started? Try a free demo!