Having lived with the pandemic for more than a year, the labor market is starting to heal. However, unemployment is still rampant.
In a time like this, companies are less likely to use employee benefits to attract new workers. However, they are eager to deploy compensation strategies to keep their workforce happy and motivated.
In fact, according to a new reportOpens a new window from Clutch, 56% of surveyed small business said that they plan to increase the overall cost for compensating employees in 2021 through paid time offs (41%) and health benefits (45%).
Matthew Burr, founder and president at Burr Consulting, said, â€œVacation, PTOâ€¦all that stuff is expected in our society now. You’re not going to be able to recruit and retain people if [you don’t offer basic benefits]. It’s not going to work out in your favor.â€
Organizations Are Willing To Offer Other Benefits Too
The study found that 14% of small business are considering offering family leave for the first time in 2021. Another 13% are willing to provide employees with a flexible work schedule.
These businesses view benefits as a crucial strategy for maintaining employee morale and performance. However, it is interesting to note that nearly 30% of them are doing so to fulfil employee requests.
How Health Benefits Became So Important Today
Health benefits becoming the most common perk offered by small businesses is no more a surprise. After the advent of COVID-19 pandemic, health concerns have taken center stage as fear and anxiety gripped the global population.
Apart from this, offering health benefits also show that the company truly cares for their employees. They can also focus on their work, knowing that they will â€œnot be out on a limbâ€ should they require medical care in the future.
More Companies Are Opening Up To Paid Time Off
As social distancing became mandatory, companies were forced to adapt to remote working very fast. In doing so, the boundary between the Â personal and private lives of workers got blurred, leading to Â burnout as they tried to cope with the new work environment.
Companies realized that time spent off the clock is as valuable as time spent on it when it came to compensation. In 2021, more and more businesses started paying employees paid time offOpens a new window (PTO), which not only helped them recruit and retain talent but also kept worker burnout at bay.
Burr observed that PTO is a â€œcommonsense perkâ€. He said, â€œPTO doesn’t really cost the company anything because eventually, you’re going to come back and make up the work anyway. It’s standard and should be offered to everybody.â€
How Offering Family Leave and Flexible Work Schedules Help Employees?
The COVID-19 pandemic also forced companies to reflect and adjust to unprecedented challenges. In 2019, businesses were offering PTO for the first time than any other benefit. However, nowadays, companies are open to providing two more benefits: family leave and flexible work schedules.
When it comes to benefits that are high on the list of small businesses in 2021, the introduction of family leave (14%) and flexi-work (13%) schedule are ranked on first and second positions respectively. However, only 12% are willing to introduce in-office benefits and 10% are likely to go ahead with health benefits.
The popularity of family leave and flexible work schedules is understandable given that parents, especially women, are struggling to tackle childcare and work. This has resulted in 275,000 women already leaving the workforceOpens a new window .
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A Word for Employers
When it comes to benefits that can be offered to the employees, a tried and tested way to go about it is to listen to the employees. Luckily, small businesses seem to understand this better and are not hesitant to apply it either.
The labor market has undergone tremendous change in the last two years. The need for providing benefits have changed also. When the market was booming in 2019, companies used to design a compensation strategy to recruit and retain talent. In 2021, the same companies are giving benefits to keep their workforce healthy and productive.
It is refreshing to see that small companies are taking the effort to respond to employee requests in this crisis time and are trying to come up with the best benefits for their workforce.