Which benefits are most important to employees?

If a business owner wants to offer excellent benefits, here’s a little more insight what the three most popular employee benefits are likely to mean to your team:

1. Health insurance

After their salary, health insurance is likely the most essential aspect of employees’ compensation. It’s one of the most common benefits, according to our survey data, and employees rate it number one on their wishlist. Business owners can also enjoy this benefit for themselves and their families.

In our survey, 58% of small business employees said their employer offers a health plan. Many employers also include vision and dental insurance alongside health coverage. As you think about offering employees health insurance, keep in mind SHRM’s finding that 56% of employees said the quality of their health plan is a big part of what binds them to their current employer. It may be worth spending a little more to offer employees a better standard of care or offset more of their premiums.

2. Paid leave

Paid leave ranks high among most employees’ priorities. The SHRM study found that 92% of employees say their paid time off policy [PTO] has a large effect on their overall job satisfaction. In addition to being the second most popular benefit, it’s also the second most common, with 57% of employees receiving PTO, vacation pay, or sick days as part of their package.

Employers that offer generous time off policies telegraph their support of employees as whole people away from the office — not just as workers.

3. Retirement savings plans

Employees appreciate help when it comes to saving for their retirement, and 41% of small businesses step up by offering a retirement plan. The most common option is a traditional 401[k] or similar defined contribution retirement plan. In addition to sponsoring a plan, many employers also choose to match employees’ contributions, but it isn’t generally required. And keep in mind that business owners can usually save more for their own retirements when they set up a plan for employees.

It’s a highly competitive marketplace for employers at the moment. Potential hires are increasingly enticed by employee benefits above and beyond pay. Progressive companies like Airbnb continue to up the ante, offering staff $2000 [£1400] to travel and see the world. According to research, 60% of candidates say that benefits and perks are a major factor when considering a job offer. For employers, it’s not always easy to know which employee benefits are most valued. Fortunately, there is plenty of research. Whether you are a small business or large corporate, here is a round up of the most desirable employee benefits.

Private health insurance is a top employee benefit

According to the Harvard Business Review, private health insurance is high on the list. 88% of people surveyed said that this would be a factor when considering a job offer. It is, however, an expensive benefit to provide - around £4100 per employee per year, depending on exactly what is provided. If your organisation can afford it, consider it. It’s expensive for employees to pay for privately, which is probably why it’s so popular.

Flexible hours

Next on the list is flexible working. The ability to work from home, vary hours and have a better work-life balance is highly valued. This includes elements such as paid leave for those with caring responsibilities. Some people will take a lower paying job in exchange for the additional flexibility.

Technology means it’s now relatively simple for employers to work anywhere, with capabilities like remote system access and conference call facilities. Some multi million pound organisations may need to monitor remote working staff productivity. There are numerous software solutions that will tell you exactly how your employees are spending their day, or how much time they spend on calls. This level of micro management may not be necessary for your business, so long as the job gets done on time. Do canvass your staff to evaluate all possible flexible working options.

Flexible annual leave

Another highly valued benefit is that of flexible annual leave. Netflix and Linkedin have received lots of media coverage about the introduction of unlimited annual leave for staff. Flexible leave can also be extended sabbatical for longer term employees, or perks like an extra day off on your birthday.

Free food and drink

A further favourite is the provision of free fruit, tea and coffee in the office. People love the idea of being given something for free, and this is a perennially popular perk.

Training and development

In today's constantly changing world, it’s highly valuable for the employee to up skill, particularly as most skills are transferable. It's a win-win situation as the employer gets a better-rounded team member.

Paying for professional subscriptions

This is an employee benefit that is widely appreciated. £300-£400 pa, which is the norm for many professional bodies, is not too much for an employer, but can be a welcome addition to the overall compensation package for key team members.

A good working environment

Nothing can take the place of a good working environment in the context of overall employee benefits, on a number of levels. There is so much research to show that our working environment affects our productivity, such as the colour scheme, plants, and so forth, so why wouldn’t you do your best to provide this? Research suggests that staff want to be proud to show visitors where they work too.

Life insurance

Another popular benefit for some people, especially those with families. For the employer, it’s relatively inexpensive per capita and easy to administer. In most cases, policies offer either a set amount or a percentage of the employee's salary, payable upon death. As with most insurance policies, there are exclusions, such as suicide.

Wellness packages

If you don’t have the physical capacity for an on-site gym, subsidised gym membership is a good alternative. It has the added advantage of helping your team to keep fit, which has a positive effect on mental health and productivity. So what might seem to be quite a costly perk can have some tangible benefits.

Progressive companies continue to up the ante, so it's good to stay updated with current trends.

Care to share?

What benefits are most important to employers?

"Health benefits have been—and continue to be—the most important category of benefits employers feel they can offer to their employees," says SHRM researcher Derrick Scheetz. The value of benefits "will depend on where employees are in their lifecycles and where they are located geographically," Lemaire says.

What 3 benefits are most valued by job seekers?

Health, Dental, and Vision Insurance Are the Most Desirable Employee Benefits.

What are the 5 benefits of an employee?

The most common benefits are medical, disability, and life insurance; retirement benefits; paid time off; and fringe benefits. Benefits can be quite valuable.

What benefits do employees value most 2022?

Healthcare emerged as the leader in ranked importance by employers as the most important type of benefit that an organization can offer its workers followed by retirement and leave benefits, which ranked jointly at number two. Retirement benefits were at 55 percent in 2020/21, back up to 82 percent in 2022.