Could fresher benefits be the decider in the war for talent?
The Covid-19 pandemic, the war for talent, the Great Resignation and the cost of living crisis. These four elements have widely disrupted the world of work, but are also changing how organisations attract and retain talent and how they shape their benefits packages.
As businesses grapple with decisions over whether to increase pay in line with inflation, could benefits be the new currency to keep talent and attract employees with the skills and experience businesses need?
Rameez Kaleem, founder and director of 3R Strategy believes so. He argues that benefits are helping businesses to bolster financial reward and pay rises as part of the talent/retention cycle.
“For a lot of organisations, benefits have been quite static for a long time,” says Kaleem. “A company that is being more creative and demonstrating they will support people through parenthood, childcare, or counselling, for example, is likely to be able to attract and retain more easily,” he says, adding that while benefits are getting more attention they shouldn’t be seen as a substitute for pay discussions.
“Benefits are not an alternative to a higher salary, but a package that includes X amount of pay plus additional benefits is a much better and more compelling offer,” he says.
Rethinking employee benefits to attract talent
Short-term shocks such as Covid-19 and the cost-of-living crisis, along with the longer-term changes driven by the fourth industrial revolution are having a “massive” impact on benefits, talent and retention according to Nick Patel, director of benefits at Willis Tower Watson.
He says the real decider in who stays, who goes and who is drawn to your organisation is not salary, but the benefits and total reward offering. “When you see the salary in the spirit of attracting and retaining talent, from a consulting perspective, we purely see that as a hygiene factor.
“It means HR, compensation and benefits professionals are going to have to rethink their success criteria and reshape their benefits. We are urging our clients to re-optimise their total reward to fulfil employees' pressing needs.”
“Yes, salary is very important, but actually what else an employer provides for their employees and their loved ones that would make them stay is the decider in a war for talent.”
Kaleem believes that one of the most effective policies in a talent attraction strategy is remote working, although he acknowledges that remote and flexible working may no longer be viewed as a benefit post-pandemic. “Flexible working is a real driver for a lot of people when they consider moving to a new job [or staying in their old one].
“If you're considering flexible and remote working as part of the benefits package, that autonomy and the flexibility and the independence to work from home or from anywhere is a massive benefit that some companies can offer.”
Reward and benefits to attract the best talent: how REBA can help
- Research: REBA DEI Benefits Research 2022 REBA’s research explores the relationship between diversity, equity and inclusion (DEI), talent attraction and retention, and reward and benefits offerings.
- Bespoke help finding the right supplier If you are reviewing benefits or looking for new services to help with your talent strategy, tap into REBA’s extensive market knowledge. Get in touch for bespoke help.
- In Focus: Cost of living REBA’s hub for insights, case studies and research on supporting employees through the cost of living crisis.
- Reward and benefits for the future workforce Come to REBA’s Future Forum to keep up to date with the latest trends in reward and benefits to attract, engage and retain talent
- Analysis: should we call time on total reward? Dr Duncan Brown asks: Is it time to retire or redefine total reward in the post-pandemic economy?
- Ask other reward and benefits professionals Ask your peers about their talent and reward experiences in our rebaLINK network
A window on organisational values
Chris Andrew, strategy director at communications consultants Caburn Hope, says that a benefits package will help to attract and retain talent because it provides a window into an organisation’s values.
“Financial remuneration is, and has always been, very important. But the money that you get from a job has never been the top reason for moving to another employer or for staying with an organisation,” says Andrew.
“The people that you work with, the projects and the brands that you are associated with, and the emotional connections that you make helps retention. That’s where I think reward and benefits can bridge the gap.”
He adds that benefits are a valuable way to communicate a broader cultural message to candidates: “What's increasingly important now is making sure the benefits package that you provide is in line with your purpose and values.
“As an organisation you may focus on caring for people, wellbeing or technology for example, and benefits can play a role in being the proof points that bring to life the different aspects of your employee value proposition (EVP).”
University Partnerships Programmes’ benefits redesign
Michael Cope, reward business partner at academic residential services provider University Partnerships Programme is overhauling his company’s benefits in line with talent attraction, retention and EVP. “We haven’t looked at our benefits since 2016 and the world has moved on,” says Cope. “It’s a good time to reflect on what people want, what’s on the market and what best practice looks like.”
Cope says that pay will always be a priority when attracting talent, but benefits are an important factor in meeting employees’ wider needs: “There’s a standard menu of benefits, but the wraparound that we are all working on is the EVP of the business and how that interacts with our benefits offering. You need to question if your benefits are playing to the requirements and needs of your workforce, rather than just following the herd.”
Kaleem also identifies personalisation as an important future trend. “Companies used to select benefits based on what the executives or HR teams think are good for people. But some organisations are now starting to personalise the benefits experience.”
He urges employers to think of attraction and retention as two separate things. While asking your current workforce what they would value may seem straightforward, establishing what potential candidates with different skills, lifestyles and motivations want is trickier. “Think about some of the groups of employees you’re trying to attract and do some demographics research on what benefits they would value,” he recommends.
“But don’t be rigid. Include options in your pool of benefits so people can pick and choose what they want.”