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The Importance of Employee Benefits in Today's Modern Workforce
With the state of today's economy, business owners will have to provide a lot of incentives to attract skilled employees. The pandemic has left the labor market in a very tight spot, which has shifted focus to compensation packages. If you're a business owner, you'll need to turn towards employee benefits to retain your employees.
Employee benefits don’t just entail cash benefits. There are some that are mandated by law, while others are offered to employees to appreciate their work. New business owners have a hard time understanding employee benefits, which is why we’ve created this article to clear the air.
If you want to learn more about employee benefits, continue reading our article to learn more about its basics. We’ll cover what they are, how they’re important, and the cost of the benefits.
Keep reading to learn about the ways you can attract and retain your workers!
What are Employee Benefits?
As we mentioned earlier, retaining hardworking workers in today's market is becoming increasingly harder. Furthermore, finding new employees is tough, which is why you will need the incentive to attract them to your business.
One way to attract or retain employees is by providing employee benefits. They are any form of compensation that is provided to employees aside from their wages. Moreover, there are various types of benefits businesses can provide to their employees.
If you’re a business owner, you will need to plan the benefits you give to your workers thoroughly. In fact, many businesses have started to one-up each other with their compensation packages. Hence, it is vital to provide fair benefits that the employees will appreciate.
Why are Employee Benefits Important?
Many businesses will spend extensive hours planning their benefits packages. If you run a business, you will need to invest heavily in this program since it will help you retain your employees. Furthermore, it also helps attract talent that could help take your business to the next level.
The pros of employee benefits are backed by extensive research. One study by the SHRM suggested that 92% of employees linked job satisfaction to the benefits they were receiving. Many employees also decide if they want to stay on the job based on the benefits they receive.
Here are a few reasons why employee benefits are important for your business!
#1 Helps Recruit New Employees and Retain Old Ones
Employee benefits are a crucial component of every business. Retaining your workers in today's competitive market could be hard, but not if you invest heavily in your benefits program. You can't risk losing workers who do a good job for you, which is why you need to provide the right benefits to retain your employees.
On the other hand, a good compensation package with benefits could also attract new workers with skills that could help your business grow. Many employees consider the benefits of other firms a big factor before they plan on switching jobs. If you’re trying to attract new talent, offering generous benefits is a great way to do so!
#2 Shows the Business Values its Employees
A major part of ensuring your employees are productive is to make sure they know that you value their effort. This means you will need to make your employees feel appreciated for the work they do for your company. One way to do that is by offering them benefits.
There is a wide range of benefits you can offer depending on what you're trying to achieve. If you want your workers to be more productive, you can offer performance-based targets that lead to bonuses. On the other hand, if you want to reward your employees, you can give them more vacation time and more benefits.
Do you see the value in structuring your benefits administration? If you're not yet convinced call our office today at 909.466.7876 and hear more about what TPG has done for other businesses.
So, if you want to save time and money, contact TPG immediately to schedule a free consultation!
#3 Improves the Company’s Reputation
The way you treat your employees will have a big impact on your company's reputation. Having a good reputation can be good for businesses since it may attract new customers. Furthermore, it could also help you attract new workers, which are hard to come by.
Providing your employees with benefits could help your business build its reputation. If your employees are happy, your company’s reputation will boom as more workers will want to work for you. If you’re ever in need of new workers, you won’t have a hard time finding the right ones!
Common Types of Employee Benefits
One of the biggest questions you may have on your mind is what benefits will your employees appreciate the most. While all benefits are values, some may matter more than others. However, since your budget is limited, you can give a few benefits without spending a ton that your employees will love.
First, you will need to provide all the benefits that are required by law. For example, the state of California requires all businesses to sponsor their retirement savings program. Once you've covered the ones necessary, you can look towards other options like employee benefits insurance.
More common types of employee benefits include paid vacation leaves, access to flexible or remote work, and opportunities to grow professionally. Employees love benefits that add value to their lives or work, so ensure you have their needs sorted.
How Much Do Employee Benefits Cost?
The cost of providing employee benefits varies with a lot of factors. Some of the factors that affect the costs are the size of the business, the number of employees, and the type of benefits on offer. While providing benefits may cost a fortune, you can offer a few cost-effective perks to your hardworking employees.
Next, a study conducted by the Bureau of Labor Statistics said that 30% of total compensation is given to employees as benefits. This is certainly a large cost you will incur; however, not all benefits have to be this expensive. Instead, you could look for other options like free lunches, company-sponsored discounts, and flexible hours.
Manage Your Employee Benefits
Managing employee benefits can be difficult; however, you could work with companies such as The Platinum Group to make your life easier. Their payroll management system covers benefits as well, which could make your business more efficient.