Is it Time to Change Your Compensation Package?
The COVID pandemic has transformed the way people work, causing many in the labor force to reconsider their priorities. The Great Resignation, which began in 2021, seems to be in full swing. According to the Bureau of Labor Statistics, nearly 3% of the American workforce resigned in October. Before this, quitting was not seen as an effective career growth strategy.
The Great Resignation has prompted many organizations to evaluate their employees’ priorities more deeply. The employee compensation package has become an even bigger piece of the puzzle for both current employees and job seekers who are pursuing career growth. It’s time for organizations to rethink their compensation package as part of their recruitment strategy while hiring new talent, building teams, and working to retain top talent.
Exceptionally High Turnover Rates
A recent report by the U.S. Bureau of Labor Statistics shared that over 4 million employees left their jobs in November 2021 – representing about 3% of the total workforce. Additionally, another survey by Microsoft found that 41% of the global workforce is likely considering leaving their current job for better opportunities, and 46% are planning a major career transition. Others have decided to work for themselves, increasing the number of self-employed workers in the United States by 500,000 since the beginning of the pandemic. Reconfiguring—and enhancing—the compensation package can be a key tool in combating high turnover rates.
Lagging Compensation Quality
Many companies' current employee compensation packages may be considered outdated in today’s complex and challenging workplace. As a result, talented employees are keeping their eyes open for new opportunities that offer potentially higher wages and better benefits. According to Glassdoor’s survey, about 60% of individuals admit that perks and compensations are significant in accepting a job offer.
An improved compensation package can be the key difference-maker when it comes to attracting qualified candidates. This does not necessarily mean an increase in salary. For example, Google is famous for uncommon perks such as yoga classes, biweekly chair massages, lunches made by professional chefs, and on-site haircuts. Those benefits are not feasible for most organizations; however, generous PTO and scholarship programs are two examples of enhanced compensation that can help retain employees and catch the eye of job searchers.
Compensation packages do not need to break the bank to offer attractive extras—start with changes such as better health insurance, flexible hours, and remote work options. Benefits like these could win over job seekers when they’re confronted with higher-paying offers that offer few extras.
It’s Time to Make a Change
With resignation numbers accelerating each month, businesses can't afford to ignore the issue. It has become clear that employees are taking advantage of the current economy to make a shift to a new industry or an organization that better aligns with their values. As part of that shift, prospective employees are looking for jobs that offer a desirable salary, benefits, and work arrangement.
This is an excellent time to review and improve your compensation package. Interview or survey current employees to help identify benefits changes that will make a difference and lead to more talent retention. Additionally, review job postings by competitors to see where your compensation package may not be keeping your organization on a level playing field. Offering a strong mix of salary and benefits is an important element in catching the eye of qualified candidates in this job market.
Conclusion
A generous employee compensation package is crucial for attracting and retaining top talent in today's climate. These ‘pandemic epiphanies’ during the Great Resignation have undoubtedly helped many learn more about the types of incentives that employees really want from their employers. Whatever the future may hold, now is a good time to re-evaluate your current employee compensation packages and give your star performers a reason to stay with you for the long term.
If you are interested in learning what we are seeing in compensation packages in the DC area market, contact Nicole at Elite Personnel. Call us if we can help you reach, attract and acquire the best of talent in the current job search market.