When you have a great employee who does wonderful work and has all the soft skills you require, you need to find ways to keep them. Talented workers can be enticed away by a variety of competitors, especially if you’re not offering them enough to stay. Although pay is a significant portion of an employee’s job choices, benefits weigh heavily in the equation. With this advice, you can find ways to improve your benefits program to prevent your best employees from leaving through the retention equation.
Understanding the Retention Equation
The retention equation involves the funds that companies spend on hiring, development, and compensation for employees, compared to the costs necessary to hire a new one. A Gallup poll revealed that employee turnover — the process of losing an employee and having to hire and onboard a new one — can cost up to twice the annual salary of that employee. Employees often leave the company for a better work environment, including benefits. As such, balancing the cost of benefits in relation to the expenses of starting anew can highlight ways that organisations can target the ideal retention rate.
Advantages of Employee Benefits Programmes
Employee loyalty
It’s not enough to make employees not want to leave. Plenty of circumstances can create that effect that do not also instil a sense of loyalty, like a tough job market or economic difficulties. Loyalty, according to McKinsey, comes from giving employees the kind of support they need to feel like they have a real purpose in the company. Simply put, workers who have support to create the kind of work environment they thrive in are more likely to be loyal to the company. Employee benefits like work-life balance, flexible scheduling, and well-being programmes go a long way toward helping to develop that kind of culture.
Engagement
Keeping employees satisfied and engaged calls for attention to the things that employees find distracting. Gallup reported that only about one in five employees is truly engaged in their work, along with a surprising 27% of managers. Changing a pattern of disengagement can be difficult, but not impossible. Companies with supportive environments, including benefits like hybrid workplaces and employee recognition, can incentivise employees to stay focused on their tasks.
Job satisfaction
Job satisfaction is a key component of retention, as employees who aren’t satisfied are more likely to start looking elsewhere. The Pew Research Centre noted that only about half of employees are truly satisfied with their jobs overall, with ratings depending on various aspects of their work environments. Roughly 45% said they were very happy with their employee benefits, highlighting plenty of room for improvement. Adding or tailoring benefits to employee needs, such as professional development or remote work opportunities, could increase employee satisfaction enough to change turnover rates.
Benefit Strategies to Promote Employee Retention
Many companies fail to accurately estimate the types of benefits their employees expect, which can make it harder to use benefits to improve retention. Besides small business health insurance, workers want a variety of benefits, depending on the type of work and responsibilities. Businesses can find the right balance by following these tips:
- Survey employees about their views on existing benefits.
- Ask workers to provide examples of benefits they would like to see.
- Devise benefit programmes that solve current problems or increase fidelity to employee expectations.
- Roll out benefit programs with transparency and care for employee perspectives.
Careful planning helps to ensure that the program provides useful benefits to employees.
Employee retention requires a continual evaluation of your processes. These include the pay and benefits that you offer to your best workers. Understand the advantages that employee benefits bring to your business. Use the right strategies to implement those benefits effectively. Doing so helps create a work culture your employees won’t want to leave.
