According to the Society for Human Resource Management, healthcare has consistently ranked as the number one benefit employees in the U.S. care about most, and many employers agree. 86% of employers believe health benefits are important to their workforce.
However, for small employers, offering competitive employee benefits can seem like a balancing act between keeping employees happy and managing the costs associated with offering insurance—not to mention other expected perks like retirement savings accounts, paid time off, bonuses, and more.
Despite the cost of offering employee benefits, it’s important to remember that an investment in your employees is an investment in your organization, with big returns on employee retention, productivity, and morale.
Let’s take a look at five reasons why offering employee benefits is worth it for your organization, even on a small budget.
Five advantages of offering employee benefits
1. Recruit and retain key employees
In today’s workforce, employees value—and expect—an employer to offer benefits. Results from Glassdoor’s Employment Confidence Survey show that 4 out of 5 employees would rather have new or additional benefits than a pay raise.
This can give small employers a way to compete with larger employers who have the budget for higher salaries. Even if you can’t afford to shell out a big paycheck, offering an attractive benefits package will get top candidates in the door and help you retain them long-term.
2. A healthy workforce is a productive workforce
Employee benefits provide your workforce with resources to remain healthy and productive, serving as a win-win for both your organization and employees.
For example, providing employees access to quality healthcare, and contributing to the cost, removes a big financial burden for employees and their families. On the employer side, offering health benefits can lead to fewer sick days and unplanned absenteeism. That’s a measurable return on your investment in your employee.
3. Culture and morale
As a small employer, it’s common to have close working relationships with your employees. When it comes to culture and morale, employees feel this reciprocity knowing that their employer cares for their health and wellbeing creates employee loyalty and retention.
In a survey conducted by the Science of Care, 60% of workers who reported feeling cared for by their employer also said they planned to stay with their organizations for three or more years, as opposed to only 7% of those who reported they didn't feel cared for by their employers.
4. Tax advantages
Many employee benefits are tax-advantaged for both the organization and its employees, and not just the ones you’d usually think of, like contributions to healthcare and retirement plans.
Several other types of employee benefits are tax-free, including:
Child care reimbursement
Personal use of a company-owned vehicle
Meals provided at the workplace
5. A foundation for growth
A final advantage of employee benefits is they set the foundation for your organization to scale and grow. As you begin to hire more employees, having a unique and attractive employee benefits package helps you attract, hire, and keep the best employees.
According to studies done by LinkedIn, organizations rated highly on compensation and benefits by their employees saw 56% lower attrition than organizations that were rated poorly.
How to offer employee health benefits on a budget
Given that employees value healthcare more than any other employee benefit, it should be first on your list. Luckily, Worksite Benefits is here to assist you with plans specifically designed for employers with less than 50 full-time employees, providing employees with health benefits they expect at a low cost you can afford. Contact us via email or phone to discuss the low-cost options available to your business.