While nearly 3 out 4 small and midsize employers (74%) said cost is the biggest hurdle when offering benefits, their employees reported that certain benefits that don’t take a lot of budget—like a flexible work schedule—are actually more important to them than some of the costly, traditional benefits, according to a recent report from PeopleKeep, the leader in personalized benefits for small to midsize organizations
As SMBs aim to offer an inclusive and robust benefits package to compete with large companies in recruiting and retaining employees, there is an untapped opportunity to get more creative.
The report—based on a May 2022 survey of over 900 SMB employees—reveals SMBs’ biggest challenges in offering benefits, examines ways SMBs can combat high costs associated with offering benefits and identifies essential strategies SMBs are using to get the most value out of the benefits they can afford to offer.
The survey highlighted several cost-effective benefits options small and midsize employers can offer that employees value.
- 93% of employees cited paid time off as very or extremely important, yet only 79% of employers said they offer a PTO policy.
- 79% of employees rated flexible work schedules as very or extremely important, but only 52% of employers offer it.
- 65% of employees said they value being able to choose their own benefits rather than having their employer choose for them.
“While offering employee benefits can be a big financial challenge for many small and midsize businesses, it doesn’t have to be,” said Victoria Glickman Hodgkins, CEO of PeopleKeep. “By offering a customizable benefits package that includes benefits employees value most, supplementing your current package with more cost-effective benefits or simply making more of an effort to educate your employees about what they’re already being offered, SMBs can compete against larger organizations in the fight for talent.”
The report also shows that small and midsize employers aren’t offering the benefits employees value most. While 77% of employers believe the benefits they offer are worth the cost to their employees, only 56% of employees feel the same way. This number decreases even further when broken down by age, with only 50% of Millennials and 36% of Gen Z employees saying their benefits are worth the cost. Since 65% of employees value having a say in their benefits, the recommendation for small to midsize employers is to ask their employees for input, perhaps through a formalized survey or an informal company meeting.
Two solutions that businesses can offer their employees for increased benefits personalization and flexibility:
- Health Reimbursement Arrangement (HRA): An IRS-approved, employer-funded health benefit used to reimburse employees, tax-free, for their healthcare expenses. Employers set a benefit allowance, and employees use their allowance on the qualified medical expense they choose.
- Wellness stipends: Employees can choose the benefits that are most impactful to them such as chiropractic care, meditation classes, wellness apps or other services and goods that the employer decides to cover.
View the full PeopleKeep report here.
For more such Updates Log on to www.hrtechcube.com