We all know about the “Great Resignation.” It turns out, the “Great Reshuffle” is more fitting, as most workers aren’t outright quitting—they’re moving to new companies for better opportunities.
Increased pay is a major catalyst for job hopping, but factors like benefits and flexibility are bigger drivers than you might think.
In a Pew Research Center survey, workers who quit in 2021 listed lack of flexibility (45%) and subpar benefits (43%) as reasons they left jobs.
Fast forward to today, and the labor shortage is apparent. Recent data shows Americans are still switching jobs at a record rate. In August, there were only 0.6 available workers for every job opening, and 4.2 million people quit.
There’s no denying it’s a candidate’s market right now. And offering flexible, valuable, and personalized benefits is crucial for organizations that want to attract and retain the best talent.
Here are the top benefits employees want right now:
1. Comprehensive and flexible healthcare
Healthcare remains in the spotlight, due to the pandemic and its after-effects on the medical system. Health costs are also rapidly rising, with health spend now representing one-fifth of the U.S. economy.
Employees need help easing the burden. MetLife’s annual benefits study found health insurance is the number one benefit employees want, with 96% saying it’s either a must-have or nice to have. Dental insurance, vision insurance, life insurance, disability insurance, health savings accounts, and flexible savings accounts also ranked high for preferred benefits.
Virtual health options are growing in popularity, too. Pre-pandemic, 73% of employers provided telemedicine or telehealth, compared to 93% in 2022.
Telehealth is a win-win. Research shows virtual appointments save time and money for both companies and workers. Telehealth is also cheaper overall, with an average cost of $79 per appointment versus $146 for in-person.
2. Increased retirement & financial savings options
Inflation and economic uncertainty are leading workers to save more. When asked whether they wanted a higher 401(k) company match or more paid time off, 57% of employees surveyed by Fidelity preferred the higher match. In a similar fashion, 56% of employees favored a strong 401(k) company match over working from home full-time.
Companies are trying to keep up. Employers who selected retirement and savings as important benefits to provide rose from 55% in 2021 to 82% in 2022.
More organizations are matching retirement plans, with 83% contributing to traditional 401(k) plans and 76% contributing to Roth 401(k) plans. Other trends include redirecting contributions, upping default contributions, and expanding compensation options for contributions.
A report by SHRM and Morgan Stanley shows workers are also placing a higher value on financial benefits like safety net insurance, education benefits, financial planning, emergency funds, equity compensation, financial coaching, financial education, and loan support.
3. Flexible and autonomous work arrangements
Many employees have proven they can succeed without working 9-5 in an office. This allows them to be more selective about choosing companies that prioritize flexibility and autonomy.
In a Harvard Business Review survey, 59% of respondents said flexibility is more important than salary or other benefits, and 77% want to work for a company that gives them the option to work from anywhere. More than half (59%) of surveyed workers also said they wouldn’t work for a company that required five days a week in the office.
The preferred working model seems to be the autonomous hybrid model. This means requiring some in-office time, but not mandating the exact days workers are expected to be there. The majority of employees (61%) said they prefer management to let team members decide when to work from home and when to be on-site.
This trend is reflected by employers, with 70% ranking flexible work benefits as important and 63% offering flexible schedules. The reward is there for companies, too—employees who are satisfied with flexibility and work-life balance are 1.8x more likely to stay at a job.
Enabling flexible working also leads to improved retention, bigger talent pools, top talent attraction, greater diversity, increased productivity, and more.
4. Extra paid time off & vacation
Paid time off (PTO) is a hot topic in the benefits world, and rightfully so.
The U.S. is one of the only developed nations that does not mandate paid vacation. Compare that to the 30 days offered to employees in countries like Brazil, Spain, and Austria, and PTO becomes a coveted perk for American employees.
The average amount of PTO offered for private industry workers with one year of service was 10-14 days in 2021, according to the Bureau of Labor Statistics.
Allowing workers extra time away from work to rest and recharge improves engagement, lowers stress, and boosts mental health, all of which leads to higher productivity in the workplace. Additionally, more than half of employees surveyed by Qualtrics said they would stay at their job longer if their company offered them more PTO.
5. Career advancement and learning opportunities
A McKinsey report found lack of career development and advancement as a key reason employees left jobs between April 2021-2022.
Career development is so important that research from LinkedIn shows 94% of employees would stay at a company longer if it provided better learning opportunities. A separate survey from BetterBuys found 92% of employees said access to professional development is important.
Workers desire more role-specific training, too: 55% reported needing additional training to perform better in their positions, and half were seeking professional development outside of work.
On the bright side, HR departments have their eyes set on development. Two-thirds of HR managers have increased learning & development budgets this year, a trend that will likely carry over into 2023.
6. Well-being and mental health
Buzzwords like quiet quitting and mental health have been dominating headlines all year, putting a heightened focus on workplace well-being.
Research by Paychex and Future Workplace shows just how essential well-being has become. 62% of employees surveyed said well-being is a key deciding factor when applying for a new job. This tendency is greater among younger generations, with 67% of Gen-Z respondents agreeing that well-being benefits would be a priority for new job offers.
Happy and healthy employees perform better, too. Employees who prioritize well-being are 74% more likely to be satisfied with their jobs, 51% more likely to stay with an organization, and 53% more likely to be productive.
When employees are struggling mentally, it can hurt business—and employers know. Almost three-fourths of companies studied by MetLife said stress and burnout are a challenge for their organization.
This is leading to a jump in mental health benefits. Employers offering mental health coverage hit a new high of 91 percent this year. One-fifth of employers also provide mental health days above and beyond regular sick leave.
7. Parental leave and family care
Employers in the U.S. are backtracking when it comes to paid parental leave, new data finds.
When comparing 2022 data versus 2020, paid maternity, paternity, and adoption leave benefits have decreased. Organizations offering maternity leave dropped from 53% to 35%; paternity leave from 44% to 27%; and adoption leave from 36% to 28%.
Businesses are hesitant to extend paid parental leave because of its price. However, that could cost them.
A report by Ovia Health found 77% of working mothers consider family-friendly support and benefits their top priority in employers, and 90% would leave for a job with better family benefits.
Improving parental leave options has shown to be a good thing. Companies with paid leave can expect increased employee retention, productivity, morale, and physical and mental health.
Workers want new types of family benefits, too. Added coverage for fertility, adoption/surrogacy, caregiver leave, and virtual family care appeal to families that have needs beyond standard parental leave.
The traditional way of working is gone. The workforce and its people are evolving, and workplaces need to evolve alongside to avoid getting left behind. Crafting impactful, comprehensive, and thoughtful benefits packages goes a long way in earning employee trust and loyalty. For help building an effective human resources & benefits team, contact Advanced Resources.