How Important Are Benefits for Employee Retention?
Losing employees is costly in terms of both money and productivity. The loss of a good employee can also torpedo morale and leave other employees struggling with a larger workload while you search for a replacement. Meanwhile, the costs of recruiting, on-boarding and training a replacement can add up quickly — and there’s never any guarantee that the new hire will work out.
The cost of turnover can have a negative impact on both the financial health of your company and the performance of your organization. And if you’re not able to adequately fill that empty position, you may end up losing other quality employees as well.
Reducing employee turnover is your best strategy for avoiding such challenges, but you may not always know which measures will effectively reduce turnover. Lack of engagement, inadequate career advancement opportunities and poor work/life balance are some of the common reasons employees cite as to why they leave a company. But even businesses that work hard to prevent those problems can still find themselves struggling to retain good workers.
A good employee retention strategy begins with understanding some of the other factors that influence workers’ decisions to stay, such as employee benefits.
The Challenge of Retaining Top Employees
While employee retention is a challenge for businesses of all sizes, it can be a steeper uphill climb for small businesses. Larger companies can offer alluring perks that small businesses simply can’t — things like ample paid time off, lavish company parties, indoor pools, gyms, ping-pong tables and more. They also have the advantage when it comes to creating robust benefits packages.
While small companies often offer advantages such as an ability to learn different aspects of the business, more advancement opportunities and a strong workplace culture, they may not offer the kind of benefits plans that workers need. Those plans can be particularly important once employees get married or begin growing their family.
According to Glassdoor, benefits have become a major consideration in accepting a job, and Fast Company reports that the No. 1 benefit sought by employees is healthcare insurance. Other benefits that factor into people’s decision to accept a new job or remain in a job include available vacation time, paid time off, performance bonuses, paid sick days and retirement, pension or 401(k) plans.
Their inability to offer robust benefits packages can put small businesses at a disadvantage in terms of both attracting and retaining talent. However, small businesses are also known for their creativity, and taking a fresh look at how to provide a benefits program for employees may provide you with options and strategies you didn’t know were available.
Creating a Benefits Program That’s Right for You
You aren’t running a Fortune 500 company, so you have probably given up on the idea of being able to offer Fortune 500-style benefits. Maybe you don’t offer any benefits at all right now, and every time you’ve looked at benefits plans, you found that they were out of your budget.
You’ll be happy to know that even when cost is the primary consideration for your small business, it’s possible to provide employees with access to insurance. In doing so, you can show that you care about your employees and their families, and you can help level the playing field against larger companies.
Because there are so many insurance carriers to choose from, you have a surprising amount of flexibility when it comes to pricing. At True Texas Benefits, we review options and see what works best for your needs and budget. In some cases, a single carrier might be the best choice for your medical, dental and supplemental insurance, but in other instances, you might need three separate carriers to create the kind of program that works best for your company.
Even if you aren’t in a financial position to fund an employee insurance program yourself, you can offer voluntary insurance plans for employees to purchase. You might be surprised to learn how many employees are eager to participate and happy just to have access to such benefits.
What’s most important is being able to create a package of solutions that is right for your business and employees. When you offer a customized benefits package, you increase your chances of attracting and retaining top-notch talent.
The Importance of Education in Employee Retention
As you implement an employee benefits plan, it’s also critical to provide education about the benefits offered, their value and how they can be accessed. The better employees understand the benefits that are available to them, the more likely they are to use them. When they are invested in using their benefits, employees view them as part of their total compensation.
That matters because, should they find themselves in a position to accept a job with another company, they’ll look at more than just the dollar amount in their paycheck. If a job offers slightly more than they’re earning but has benefits that aren’t as comprehensive or affordable, they’re less likely to accept that position based on financial decisions alone. Proper education will give them a more holistic view of their total compensation.
If you’d like to improve employee retention while providing your workers with insurance options they haven’t had in the past, True Texas Benefits can help. Let us show you how we can create an insurance program that’s tailor-made for your employees’ needs. Learn more about benefits by downloading our eBook, How the Right Employee Benefits Can Solve 7 Small-Business Challenges today!