Quick look: With inadequate benefits being the second most common reason people switch jobs and 70% of employers planning on adjusting their benefits packages this season, it’s time for SMBs to analyze their workforce, choose suitable benefits, and source them affordably. Here are three tips to keep in mind as business leaders embark on that journey.
Crafting a benefits package that resonates with your employees can be one of the best ways to retain them and attract new talent. But how should small- and medium-sized businesses (SMBs) determine which benefits may make the most impact on their workforce?
Proper research and securing affordable, reliable access to highly sought-after benefits is key. And open enrollment is the perfect time for business leaders to focus on how they plan to build a competitive employee benefits package.
The right benefits matter
After experiencing a tight labor market for more than two years, a run-of-the-mill benefits package won’t cut it anymore with today’s top talent.
PwC’s “Pulse Survey: Next in Work” found that the second most common reason people seek a new job is because of lackluster benefits. The study also found that these workers seek non-monetary perks like workplace flexibility and upskilling opportunities.
And employers are listening. In its “Survey on Health and Benefit Strategies for 2023,” HR consultancy firm Mercer found that most employers are enhancing their benefits in the upcoming year to meet their workforce’s needs better. Specifically, 65% plan on making some improvements, 5% are slated to make significant changes, and another 16% stated they updated their packages in the 2022 plan year.
3 ways to build a competitive employee benefits package
Determining which benefits best echo your staff’s wants and needs requires research, but it doesn’t need to be complicated. Here are three best practices to guide you as you determine how you should modify your current benefits package.
1. Analyze and listen to your employees
Today’s workers want personalized benefits, and to deliver, business leaders must have clear insight into their employee base. It is key to have a bird’s eye view of your staff demographics and listen to individual employees’ opinions on what matters most to them.
According to the Mercer survey, almost half of employers refer to their worker demographics and personas when choosing benefits. A tool like ExtensisHR’s DEI Dashboard can help you do that. The Dashboard enables business leaders to examine data on demographics, pay equity, salary trends, employee turnover, promotions, and more.
Mercer also found that 61% of businesses survey their employees to determine which benefits they value the most, and 58% of workers say they wish their companies surveyed them more often. A proper employee survey strategy will yield a slew of valuable data and includes designing the survey, gathering data, analyzing the results, and acting on the findings.
2. Choose the benefits
Once you have a firm grasp on the populations within your workforce and which benefits they value, it’s time to consider your ideal employee benefits package.
Today’s workforce is diverse and multigenerational, and typically your benefits should reflect this. For example, baby boomers value physical health and ancillary medical coverages, like vision insurance. And with many on the cusp of retirement, they tend to show interest in financial planning services. On the contrary, younger employees may value things like a flexible schedule, student loan assistance, and family-building support the most.
Generally, it’s suggested that business leaders focus on their most popular benefits first, like affordable health, dental, and vision insurance with telehealth coverage, and then decide on voluntary benefits like pet insurance, legal protection, and supplemental health insurance that serve as icing on the cake.
3. Partner up and provide
You know who your employees are, what they want, and how you plan to meet those needs. But how do you affordably source all those benefits?
A great place to start is considering a partnership with a professional employer organization (PEO). PEOs provide small employers with access to large group plans, leveraging their size and scale to offer more plan designs, at a lower cost than if SMBs were to enroll in them on their own.
Some things to look for when considering a PEO partner include:
- Employer Services Assurance Corporation (ESAC) accreditation
- Certified Professional Employer Organization (CPEO) status
- Certification Institute (CI) for worker’s compensation and risk management
- Dedicated customer service model and HR manager
- User-friendly HR technology
Even after you have implemented the ideal benefits package, it’s important to pause regularly and measure its success in terms of employee usage and satisfaction. Suppose a particular benefit is experiencing low utilization or unhappy employees. In that case, it may be worth increasing your benefits communications to drive awareness of that benefit or removing or swapping that program the next time you change your benefits package.
It’s time to tweak
A successful benefits package will constantly evolve over time. And amid a relentlessly tight labor market, the time is now for SMBs to consider how to design a competitive employee benefits package for next year. Fine-tuning your benefits package—which can be obtained through a PEO and should be evaluated regularly—will match the needs of your workforce and aid in attracting and retaining talent.
A PEO like ExtensisHR enables you to leverage data from its DEI Dashboard and opens the door to a range of Fortune 500-level employee benefits like:
- Medical, dental, and vision coverage
- 401(k) retirement plans
- Family-forming support
- Employee Assistance Program (EAP)
- Pet insurance
- And more
ExtensisHR’s experts also provide benefits consulting, planning, servicing, and administration, as well as assistance with Affordable Care Act (ACA), Consolidated Omnibus Budget Reconciliation Act (COBRA), and Employee Retirement Income Security Act (ERISA) compliance.
Ready put pen to paper and start designing a competitive employee benefits package for your organization? Contact the professionals at ExtensisHR today.