Can’t Give Employees Raises? Add Benefits
Paid mental health days or a sabbatical program would boost employee loyalty without locking in the higher costs of across-the-board pay bumps.
Sometimes, a sabbatical will do.
Despite fears of a slowdown, the labor market is still pretty tight. Most companies aren’t laying people off. They are more concerned about retaining the workers they have. But how? Inflationary pressures mean employees want raises, but employers might not want to grant pay increases in an uncertain economy.
Yet too often, companies overlook another way to boost employee retention and morale. Enhancements to benefits are often cheaper than across-the-board raises. There are usually also tax advantages both for employees and employers. Those that convince workers to stay are those that increase what academics call “employee embeddedness.” In other words, they entangle the employee in the organization in a way that makes it tough to escape, er, quit. While nap pods, on-site yoga and free food got a lot of attention during the tech boom, these sorts of perks are probably better for impressing potential recruits than retaining existing staff. And the most common benefits in the US are more pragmatic: paid vacation, health insurance, a retirement account.