Employees have many expectations of prospective employers, and their desires make for a competitive landscape. Nowadays, employees expect access to good benefits to support themselves and their families.
Without a comprehensive benefits package, you have less chance of attracting or retaining the talent that helps your business develop and thrive. Improving your benefits package brings many advantages, and specifically, it can:
Lower Your Employee Turnover
No business wants high turnover since the cost of replacing an employee can equal a third of their annual salary. Costs of training, temporary replacements, and lost productivity most notably add up. However, indirect and less measurable costs, such as reduced morale due to covering a departing coworker's shift, also take a toll. As your company grows, senior employees hold institutional memory and ensure new employees complete tasks efficiently. They become trusted resources, helping to advise incoming employees, so they quickly reach optimal productivity.
Not having sufficient benefits increases turnover directly and indirectly. Employees may, for example, leave if a life change denies dependents coverage by your health plan. A slim package attracts those desperate for any job who will quickly move on rather than commit to your company. The best candidates will go to employers they would like to stay with for a while and offer competitive benefits and a good working environment.
Keeping turnover down saves costs in training and hiring and makes the most of your employees' productivity and knowledge. Additionally, when a new candidate comes in, that some of their prospective coworkers have spent years at the company communicates you have a quality culture and environment. It shows you have happy employees who are satisfied with their career options.
Increase Individual Productivity
Your employees produce better work when they feel cared for since the positive goal of helping your company inspires them. Good benefits show care and encourage employees to stay longer, helping decrease stress about their and their family's health or retirement. Stress in and of itself increases time off and health concerns, which decreases productivity while increasing your healthcare costs.
Removing these concerns allows more energy to focus on work, which translates to better output. Helping your employees increases loyalty and productivity and helps your business thrive. By organically improving productivity, employees will feel empowered rather than just as cogs in the machine. That increases productivity sustainably, rather than simply increasing false indicators, such as the number of hours worked.
Improved healthcare also reduces downtime, which increases productivity by keeping more people in-office and working their full time. Healthier workers have more energy and commitment, as well as better mental health and improved morale.
Improve Overall Morale
Showing you care for employees and their future well-being further improves overall morale. Providing retirement benefits supports their future, and health care supports their families. Removing these concerns gives employees less to worry about, giving them more reason to feel better.
Happier employees are 13% more productive, and positivity is truly contagious, creating a better work environment for everyone. When your employees have less stress, the entire office brightens. Additionally, people looking for another job due to poor benefits will likely drag everyone down, regardless of whether done deliberately or consciously. On the other hand, people who stick around develop relationships that improve company culture and create collaborative work environments. Productivity dramatically increases when people consider their coworkers their friends. High morale results in spontaneous socialization between employees, which improves how they communicate and work together and further increases morale.
Increased morale also feeds back into improved health. Studies show that unhappy workplaces increase rates of depression and heart disease. Worker discontent decreases their quality of life, increasing stress and time off. It only takes one person who truly hates their job to impact everyone in the office negatively. People do not work well when they are wishing so-and-so would stop complaining and leave already.
Maintain a Healthy Workforce
Provide your employees with an array of healthcare plans, so they can choose from plans with high premiums or inexpensive plans. Giving employees the option to decide what level of deductible they’re comfortable with lets them choose the plan that provides best for them and their families.
High cost-sharing plans create the biggest barrier to preventative care because they include high out-of-pocket costs, such as high deductibles and co-pays. Some employees, who are healthy and typically do not seek much medical care, prefer high-deductible plans because of their lower monthly premiums. Whereas employees who regularly seek medical care often opt to pay higher monthly premiums for plans offering more comprehensive coverage that require less out-of-pocket costs when receiving medical services. Employers must consider the needs of all their employees and design benefit offerings that include both options.
Encourage your employees to get regular check-ups and ensure the benefits you offer include mental health care. Routine preventative health care prevents worse health later in life, lowers absenteeism, and improves morale amongst your employees. Healthier people take less time off, work harder, and even stay in the workforce longer, helping your company grow. Good healthcare also extends to their families, reducing the amount of time they take off to care for others. Measuring the benefits of a healthy workforce poses a challenge, but it increases productivity, lowers turnover, and in turn reduces your healthcare costs.
For many small companies, affording healthcare and retirement benefits is a significant challenge. Yet, it is vital to maintain the health of your employees, improve productivity and morale, and above all, lower employee turnover. All these things link together to make your company a fantastic place to work, and partnering with a PEO can give you access to better benefits than you could otherwise afford.