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Recruiting talented employees is a tough task in any labor market. With competition fierce and unemployment at a 19-year low, though, it’s even more challenging in 2020.
An impressive employee benefits package is one of the best ways to get results. Though salary continues to be the most important factor in where employees choose to work, benefits are not far behind. In fact, 80% of employees say they would prefer additional benefits to a pay increase.
Benefits are also uniquely positioned to showcase a business’s values and priorities. By creating a benefits package that reflects the preferences of potential hires, the business sends a signal that their values are aligned with those of the workforce.
Most businesses understand this. The desire to recruit valuable employees is actually the third-most common reason small businesses offer benefits.
Effectively integrating benefits into an overall recruiting strategy can be difficult, however. Here are five tips you can use to get started.
How your business spends its benefits budget should depend largely on the employees you’re trying to attract.
Many businesses are looking for younger talent to grow the company and reach new potential customers. If your business is looking to hire millennial workers, you should know their top benefits desires are health insurance, flexible work hours, and student loan repayment assistance. In-house training programs or a budget toward professional development are also highly prized.
You may also be in the market for Generation X employees who are primed to take over management positions as baby boomers retire. More stressed about retirement savings than other generations, Gen Xers appreciate robust 401(k) or IRA offerings.
If you’re aiming to recruit one or two particular employees, your approach can be more specific. Parents, for example, highly prize benefits that provide flexibility. Paid parental leave and flexible work hours are among the most desired benefits for these groups.
By considering these needs, you’ll be able to draw up a short list of benefits to prioritize.
One of the easiest ways to differentiate your company is by assessing your competition and identifying areas of comparative value for jobseekers. This process should always include a frank assessment of the benefits your competitors offer.
In a crowded market for talent, employee benefits are often the deciding factor for jobseekers when choosing from among multiple positions. Businesses can differentiate themselves by choosing benefits not offered by competitors—benefits that appeal to potential employees in unique ways.
When assessing competitors, your business should look at your immediate geographical competitors as well as competitors within your industry. If you don’t already know, you can get a sense of who your most immediate competitors are by doing a search on LinkedIn or Indeed for some of the job roles you’re looking to fill.
Once you’ve identified your competitors, make a spreadsheet with all the benefits you’re considering. Leave room for new benefits your competitors may be offering. Assess all competitors, list them in your spreadsheet, and mark which benefits each group is offering.
By analyzing the results, you can easily identify areas where you may be able to offer unique value.
For example, businesses located in crowded downtown areas might offer tax-free reimbursement for public transportation if their competitors in the area do not. Industries that rely on continuing education and professional certifications could also take on the cost of employee education themselves.
Businesses can also offer comparative value by covering a higher percentage of employees’ health insurance premiums or providing a better 401(k) match.
In addition to what you’ve found when considering your ideal employee and how your competitors stack up, you can find immediate success by choosing benefits that support flexibility.
All employees, particularly in a good job market, appreciate benefits that fit into their lives seamlessly. The less work employees must do to adapt to and use the benefit, the more valuable it will be to jobseekers. Benefits that promote flexibility themselves are also important to consider.
Some benefits, like flexible work hours and open paid time off (PTO) policies, are obvious solutions.
But businesses should also consider portable benefits—benefits employees can take from one job to another. Health savings accounts (HSAs) and 401(k)s are great examples of portable benefits. Owned exclusively by the employee, HSAs and 401(k)s follow the employee from job to job, and businesses can choose to contribute to them. This reduces hassle on the employee’s end and makes it more likely that prospective job seekers will find value in the benefit.
Even benefits that are owned by the company can promote flexibility. Health reimbursement arrangements (HRAs) allow businesses to reimburse employees for personal health insurance policies they choose themselves. This not only allows employees to choose a policy best suited to their needs, but it also removes the fear that losing or leaving a job will mean losing health insurance.
Once your business has taken these initial steps, you can start prioritizing which benefits you want to emphasize in your recruiting strategy.
No business has an unlimited budget, and you’ll need to make some tough choices. Prioritize by choosing the top two or three benefits that provide the broadest appeal to the most people, and determine the budget you’ll need to truly make the benefit valuable.
For example, if you’re offering an HRA, you’ll need to choose an allowance that covers a decent percentage of the average individual health insurance plan in your area. For transportation benefits, you should be able to offer full reimbursement of employees’ travels to and from work. HSA and 401(k) offerings should at least be competitive in your industry or geographic region.
Once you’ve determined the budget you’ll need to make these core benefits work, you can think about expanding your benefits package. If you have budget left over, move on to the third or fourth most valuable benefit on your short list.
Remember, there are benefits that don’t require a significant budget to offer. Flexible hours or the ability to work from home are highly prized benefits that come with a lower price tag for your business.
To truly leverage your benefits package in your recruiting strategy, you need to make benefits a part of your brand identity. Potential employees should know about your offerings before they walk in the door for an interview.
This starts with the steps you take to find employees. When reaching out to potential employees on LinkedIn or through referrals, ensure you mention your benefits package in your very first communications.
If you’re using traditional methods of job posting, like listing open positions on Indeed or Glassdoor, make sure to include your company’s benefits and perks in addition to descriptions of the company. You should also leverage Glassdoor and other tools to allow current employees to review your benefits online
By making your benefits part of your company culture you’ll not only attract great new employees, but you’ll also send a message to both current and potential employees about who you are.
Employee benefits are an invaluable piece of a business’s offerings and overall culture, but they’re too often overlooked in recruiting.
By strategically evaluating and updating your company’s benefits package, you can capture the attention of the top employees in your industry, reduce time to hire, and even increase retention.
As the competition for talent continues to grow more challenging, these skills will only grow more important. Start the process now and position yourself for even greater success in the future.