According to Glassdoor’s Employee Confidence Survey, nearly four in five (79%) of employees prefer new or additional benefits to a pay increase. For the first time in history, we are seeing employees value benefits over raises. Why is that? What has changed?
For starters, the next generation, known as millennials (those born between 1980 and 2000), has dominated the workforce. By the end of this year, Millennials will make up for half of that workforce. Millennials are different from any other generation because they carry the highest student loan burden, with an average of $34,504 per borrower. Millennials are making more money than baby boomers and Generation X did when they started working, but notice that their money doesn’t go nearly as far. In addition to the amount of student loan debt this generation carries, they also have the standard economic expenses such as the cost of their home or rent, both of which have increased at a faster rate. Because of these expenses, little remains for personal indulgences.
Because millennials will identify half of your workplace population this year, you must be able to cater to their needs as an employer. Rather than increasing their pay, millennials desire things like schedule flexibility and the option for remote work. They also want benefits and employee perks that enhance their lifestyle. The concept of better benefits and perks over higher pay is new to most employers, so we are here to help you understand why millennials are choosing company perks above salary.
For A Better Lifestyle
Years ago, it was much easier to live a comfortable lifestyle. The cost of living was reasonable, and families worked very hard to provide for their families. Today, it isn't very easy for the average millennial to live a comfortable lifestyle as the older generations enjoyed at their age.
Millenial's are coming out of school with massive amounts of student debt and then have to pay their other financial obligations such as rent, car payments, etc. Once they satisfy all of their financial obligations, they realize there is very little for lifestyle spending. This vacancy is where employers can help their employees. To contribute to their employee’s lifestyle, rather than offering them a higher salary, offer them perks that interest them!
An excellent benefit to consider is a Lifestyle Spending Account (LSA.) An LSA is an employer-funded account in which an employer enables employees to make specific types of purchases from the accrued funds in their LSA. Here are some of the expenses LSAs can cover:
Health and wellness costs (gym memberships, fitness classes, nutrition counseling)Financial counselingEntertainment events such as concerts or sports outings Spa treatments Food and beverage Daycare Learning opportunities.
These are only some examples that LSAs might cover. LSAs can pay for anything that the employer believes will contribute to a better lifestyle for its employees. Try a free demo to learn more about how LSAs could benefit your team!
To Encourage Teamwork
Millennials enjoy working collaboratively with co-workers on projects, which is why its essential employers develop a culture that encourages employee engagement and connections with team members across the organization.
A way to encourage teamwork is by promoting monthly or weekly outings where your employees can connect with their peers outside of the office in a casual setting. LSAs are a great way to encourage participation outside of the office. Some employees might be hesitant to join in activities and social events outside of the office because of their financial burden. With LSAs, these expenses are part of the program by the employer so that they can enjoy the casual interactions with their work peers.
For New Learning Experiences
Another quality of millennials is that they continuously seek opportunities to grow personally and professionally to develop new skills and knowledge. As an employer, having the benefits and perks in place that help your employees grow demonstrates an active investment in them.
If you have an LSA in place for your employees, it can cover any online classes or tutorials that employees might express an interest in. Another possibility is using LSAs to include events such as networking events or conferences that your employees might wish to attend. Millennials hate to feel stagnant and may seek another job if their current employer doesn’t provide continuous training opportunities.
Flexibility and Work-Life Balance
At the very minimum, millennials enjoy having the option to work in the office or at home. They appreciate the flexibility to adjust their work schedule to accommodate personal or family needs.
Additionally, nearly 40 million Americans suffer from an anxiety disorder. Several of those suffering from anxiety blame a stressful, busy work environment. As many as 8 out of 10 Americans believe office life contributes to their stress.
If you don’t have the budget for employee perks, offering your employees flexible schedules is an excellent starting point for providing your team perks. Consider allowing your team to work from home one or two days out of the week as your culture changes gradually with the idea.
A Better Company Culture
Employees are not leaving their jobs for better pay as much as you think. Nowadays, they are leaving jobs to find a company that provides a better company culture. Studies show that company culture has a significant impact on turnover rates. Studies show that the likelihood of job turnover at a company with good company culture is 13.9 percent, whereas the probability of turnover with poor company culture is 48.7 percent.
A good company culture supports involvement and provides positive ways for their employees to get together for personal and professional development. These activities occur both within and outside of regular company hours. With a good company culture, you can expect employees to stay longer, work harder, deliver innovative work, and find ways to go the extra mile.
Work2Live: Giving your employees what they want
At Work2Live, we strive to help employers reduce their turnover rate by keeping their employees happy. That is why we are inspired to help you offer your team the benefits and perks they want with LSAs. With LSAs, there is something for each of your employees to enjoy. This unique perk helps boost your company culture by enhancing work-life balance and demonstrate to your team your investment in them.
Are you looking for new ways to attract top talent and hold on to your best employees? Hold off on the pay increases and get started with Work2Live today!