It’s All About the Benefits
What type of benefits is your employer providing? Will your next employer’s benefits be comparable to what you have now? It’s something to think about before considering your next career move. Companies spend large amounts on benefits for their employees to help retain and appropriately compensate them. The right balance of benefits is a crucial part of employee satisfaction. However, many employers do a poor job at communicating what benefits are offered and how that applies toward a total rewards package for employees. So what do you need to know about employee benefits?
Number one, a large portion of the companies compensation expenses are paid out in benefits compared to wages. “According to Employer Costs of Employee Compensation Survey, in the United States only 69.7 cents of every dollar of employee cost to employers goes to the employee in terms of wage or salary. That is, more than 30 percent of employer cost for workers goes somewhere other than directly into the employee’s paycheck.” i Why is it important for you to know? Employers are spending lots of money to pad your compensation package with more than just annual salary. Benefits may include health insurance, vision and dental plans, 401K, stock options, life insurance, etc. While some of these benefits are legally mandated others are not. These benefits are an important component to your overall economic security.
Number two, you can’t put a value on some benefits. Nonwage benefits are a huge part of a company’s culture and just another example of how companies try to accommodate and fulfill their employee’s needs. These benefits may not be evident in your weekly paycheck but you may certainly notice a difference if you were paying for these expenses out of pocket. Child-care for example is a growing benefit trend for many companies that meet an essential need for numerous employees. Also, employee “perks” contribute to your bottom line and overall comfort. Some examples of these perks may be flexible scheduling, free meals, travel, transportation, and leisure activities during work hours. Other perks may be more subtle like first choice on job assignments or preference when scheduling vacation.
Number three, know which benefits are important to you. Each employee puts their own value on a particular benefit. Contributing factors may be your current life stage, spouse’s benefits package, and/or basic need. An example of these contrasting values might be a be diabetic employee, whose spouse stays at home with their young family verses an empty nester who is hoping to retire in another five years. Some employers even allow their employees to choose which benefit options they prefer contribute to their total compensation. This offers great flexibility to an employee’s needs and priorities.
Realizing the true value of your employee benefits may go a long way in reevaluating your job satisfaction. Most employers do a poor job at relaying overall benefits or helping employees comprehend their value. When comparing your current employer benefits to that of a new job offer it is vital that you weigh in these factors to help you determine if a change is best for you. Knowing the priority you place on each benefit and the advantage that each factor provides will help make your choice even easier.
i Hallock, Kevin F.(Jan. 2011). The Disconnect Between Employer Cost and Employee Value.Workspan Magazine by WorldatWork.