It seems like everything is tight right now – the labor market, the economy, and our budgets, to name just a few. Now, perhaps more than ever, though, to remain competitive, organizations need impressive benefits packages. Keeping up in this climate may seem like a pipe dream, but there are affordable ways to prioritize employee benefits on a limited budget.
In this guide, we’re reviewing five low-cost benefits options that will keep you competitive on a tight budget. Some of the most in-demand benefits options and services right now are actually quite affordable and, if well implemented, could potentially save your company money in the long run. Let’s have a look.
1. Evaluate Your Current Offerings
Prioritizing employee benefits on a limited budget starts with a look at your current offerings. A thorough review can help you to trim underutilized benefits and zero in on what your employees find most useful. Any extra room made in your budget can be applied to perks and services that better meet your employees’ needs now.
It's not just about cuts, either. Sometimes, a refresh is in order. HR tech and services are in a state of rapid change right now. You may be surprised by the sort of perks, services, and systems that are available at little or no cost to your organization – options that may not have been there one or two years prior.
A thorough review of your benefits strategy will include these steps:
Survey your employees. Let your employees tell you what they feel are the strengths and weaknesses of your current offerings through pulse surveys, focus groups, and one-on-one meetings.
Take a look at the hard numbers. Evaluate current and past usage data to get an idea of how vital a given offering is to your company.
Review your employee demographics. This can give you an idea of what benefits might be more or less useful in the future, ensuring you stay competitive in the long run.
2. Offer More Flexibility
Remote work options and flexible hours are in demand right now and have been for years -- in 2017, a survey by the Harvard Business Review ranked flexible hours as the second most desired benefit for job seekers. Offering scheduling flexibility is a fantastic way to stay competitive, attract job seekers, and retain your current top talent. No need to worry about the cost -- not only are such policies affordable to implement, but they’ll also potentially save your organization money in the long run.
A 2021 report from Global Workplace Analytics estimates that employers can save an average of $11,000 annually per employee working a half-remote schedule. That money isn’t just coming from the lowered cost of keeping the lights in the office off a few days a week. Employees who have control over where and when they work tend to be more productive, more engaged, and less likely to burn out.
Flexible work options have been shown to improve retention, decrease absenteeism, and increase a company’s bottom line in significant ways.
3. Expand Paid Time Off
With a flexible PTO policy, your employees can take the time they need when they need it without worrying about an annual limit. You may be concerned that such a system is ripe for abuse, but overall, that isn't the case. Before we dive into those numbers, though, let's take a look at the benefits your organization might reap with a well-implemented flexible PTO policy:
Building a culture of trust and respect. A well-implemented flexible PTO policy shows employees that you trust them to manage their time and get their work done.
Employees will no longer feel pressured to come in when sick. No more losing half the office to a stomach bug. By allowing your employees to take a day when they need to, you may lower absenteeism overall.
Opening the door to diversity. A flexible PTO policy makes more room for underrepresented employees, particularly those caring for a dependent, and a diverse workforce is an innovative workforce.
The company saves money. Flexible PTO increases retention and eliminates accrued end-of-year and end-of-employment PTO payouts.
Now, about the potential for employees to take advantage of such a policy: multiple studies, including a 2019 survey by WorldatWork, have found that employees generally don’t use all of their allotted vacation time annually, even with flexible PTO in place. In fact, the bigger concern may be burnout.
While the numbers show that PTO abuse isn’t the norm, flexible PTO still may not be right for every organization. Successful implementation requires a strong, transparent policy and standard practices modeled by management. If rules and expectations around flexible PTO are unclear, or if not taking time off is over-incentivized, you may quickly find yourself with a burnt-out workforce unwilling to take time off.
4. Seek Out Financial Wellness Tools
You’re tightening your budget, and your employees are, too. Rising costs of necessities like food, gas, and healthcare are stacking up, and workers face heightened financial stress, which can be catastrophic to mental health, productivity, and retention. Financial wellness options have always made for desirable benefits, but now more than ever, the relief they can provide makes them worth investing in.
You can potentially find low-cost or even free options through your current services. Consult with your current 401k and payroll service providers. Many offer low- or no-cost financial management apps or free consultation hours with financial advisors.
5. Partner Up For Vendor Discounts
By partnering with vendors – benefits providers, brokers, and even local businesses – you may be able to offer valuable perks to your employees without your company taking on too great an expense. Vendors often partner with businesses to offer employer-subsidized benefits like supplemental health and life insurance or significant discounts on various services, from financial wellness education to gym memberships.
Voluntary benefits like these bridge the gap in affordability, making services and coverage that may not have been realistic to buy privately more obtainable. It’s a great way to strengthen a benefits package without incurring too much cost.
Prioritizing benefits when your budget is limited shows workers that your organization cares about their well-being, and valued employees, in turn, are more engaged and productive. The costs are worth the investment, and as you can see from the tips we’ve laid out above, those costs don’t need to be astronomical. You can stand out, attract talent, and retain your best workers with a little bit of creativity and a focus on what’s in demand right now.