The Changing Compensation And Benefits Landscape

How to win the war for talent

The US workforce has undergone dramatic changes during the pandemic. However, despite the seemingly constant shifts, employees and job candidates’ expectations around total compensation, salary transparency, workplace culture and benefits offerings have consistently grown stronger.
 

Today’s employees are willing to step away from their current roles if those expectations are not reasonably met. In fact, according to beqom’s 2022 Compensation and Culture Report, 65% of Americans have searched for a new job over the last year. Instead of in-office perks that wooed employees pre-pandemic, employees’ needs have shifted, and in addition to higher pay, they are looking for flexible working hours (70%) and increased pay transparency (60%).

In order to retain talent, employers must search for solutions that are both budget-friendly for sustained use and clearly show employees that they are valued.

Offering Competitive Compensation and Increased Salary Transparency

According to our data, less than half (48%) of employees know their total compensation. However, as inflation in the US continues to spike, employees are taking a closer look at their earnings, and half of all employees have asked their organization for a raise or promotion.

Amid challenging economic times, employees are also calling for employers to be more transparent around salary benchmarks. More than half (58%) of employees have spoken to a colleague about their salaries in the past year and 43% have found out that a colleague in their equivalent role with similar experience is earning more than them, leaving them questioning pay equity within their organization.

Employees’ grievances and secrecy around pay can create distrust for their employer. (In fact, when employees perceive a pay gap, there is a 16% decrease in intent to stay, which is 50% worse than the typical impact of a pay freeze.) However, by providing increased levels of pay transparency and more insight into how decisions around pay are made, employers can work to build greater trust with their staff.

The same goes for an organization’s gender pay gap. Women continue to earn 82 cents compared to every dollar men earn, and according to our report, over one-third (37%) of employees say their workplace does not disclose its current gender pay gap internally or externally. Instead of leaving employees to discuss pay on their own, employers must get at the forefront of these conversations to clearly and accurately share the process behind salary decisions.

This is especially important when considering employee retention since 60% of employees say they would be willing to leave their current position for more pay transparency.

Pay Should Reflect an Organization's DEI Goals and Progress

Beyond their personal salary, employees also value their organization’s equal pay strategy as a whole. The majority (80%) of employees say that they want to be a part of a company that values DEI, and more employees are paying attention to the bigger picture of how compensation practices can factor into their company’s DEI goals.

In prioritizing DEI in their company, employees are clearly looking for pay structures that reflect their strong desires for overall equity. In fact, 34% of employees say their workplace has implemented a new or updated DE&I plan in the past year and nearly two-thirds (64%) of those respondents say the new plan included an equal compensation strategy. These efforts toward creating fair and equal pay are critical for today’s employees, and when employees see their leadership reflecting their shared values, it can strengthen appreciation and retention.

Providing Working Parents with Flexible Benefits

During the pandemic, working parents realized that there are better ways to balance career and family obligations, including working remotely or on a flexible schedule. With this in mind, many are seeking benefits and perks that give them more work-life balance, and allow them to live a healthier personal and professional life.

Working parents are typically juggling their job duties and childcare at the same time, and without flexibility, childcare benefits, or paid parental leave, it can be challenging to fit both priorities into each day. Considering nearly half (48%) of working parents have thought about exiting the workforce because of childcare responsibilities (compared to 46% in 2021), these benefits can make or break their decision to stay with their current employer.

Even for parents who are not considering quitting, many still feel that being a working parent during the last two years of the pandemic has disrupted their career and pay paths. Nearly half (45%) of U.S. working parents believe their path to promotion has been negatively affected and 47% believe their ability to receive a pay raise has been negatively impacted.

The U.S. job market is still tight, which is why employers must keep evolving their compensation, company culture and benefit offerings to stay competitive. In order for employers to win the war for talent, they must make an effort to stay up-to-date on employees and job candidates’ expectations, and implement them wherever possible.

Author Bio

Tanya Jansen is Co-Founder of beqom. Visit www.beqom.com Connect Tanya Jensen