A new year usually brings with it new expenses, in the form of company-wide pay bumps. But business owners may be able to find significant savings in the “Payroll” line-item of their 2016 budgets by offering employees new benefits or perks instead of salary increases.
In a survey of 2,000 employed American adults by job review site Glassdoor, 79% of respondents said they’d prefer additional benefits to a higher salary, with more comprehensive health insurance plans (40%) rating highest. While Canada’s universal healthcare system shields employees from a lot of medical costs, the Sanofi-Aventis 2011 Healthcare Survey found that given a choice between their benefits and up to $20,000 in cash, most Canadians prefer the perks.
Other themes highlighted in the Glassdoor survey appear to be universal. For instance, companies are reining in costs and limiting the number of paid sick days (32% of respondents said they’d like more of them) and paid vacation days (37%) they offer—if new employees are offered them at all.
The desire for benefits over extra pay is especially prevalent with the younger set, those aged 18-34: 89% of them said they’d prefer benefits or perks to a pay raise. Compare that to the response of those aged 55—64, the majority (66%) of whom said they’d prefer a higher salary over perks and benefits. Of course, baby boomers likely already have jobs with benefits, having entered the workforce during a period of economic expansion and relative job stability.
Here’s the complete breakdown of what the benefits the respondents would take over a salary raise:
Interestingly, the researchers attribute the shift in expectations to a strengthening U.S. economy. “[As] job market confidence continues to rise, there is no doubt it is a job seeker’s market,” says Rusty Rueff, Glassdoor career and workplace expert. “This is a clear signal to employers that in order to compete in today’s labor market, it’s not just about salary and compensation, employers should be communicating clearly about non-traditional compensation.”
Offering added perks and benefits could be a useful recruiting tool. Millennial employees flock to employers that will help them achieve a healthy balance between work and their personal lives. Members of Generation Y also tend to have strong value systems and view work as an outlet to help better themselves and the world, rather than just a means to a paycheque—meaning their salary expectations are lowered. The demand for these kind of perks likely stems from millennials’ desire to maintain their lifestyle, which they wouldn’t be able to do without their employers’ help.
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