With a looming recession and rising inflation, more companies are looking to save money in 2023, resulting in layoffs, reduced benefits, and more. However, cutting employee benefits is one of the worst ways to cut costs. It also shows your employees that you don't see them as valued members of your company. Employees view their benefits as an essential part of their overall compensation package and leverage them looking for a new role. In some cases, they view them as more important than their salary. Cutting employee benefits negatively impacts morale, productivity, satisfaction, and brand reputation. Instead, look for ways to save money on employee benefits this year, starting with these tactics.
Ask employees what they want
The best benefits are the ones that your employees use. So optimize your benefits program by offering the programs your employees want and will use. It's not worth wasting your money on resources and benefits that you think your employees want. Instead, survey them, ask them what benefits are essential, and design your benefits program to align with their wants and needs. If you need a place to start, here are seven benefits employees want in 2023.
When deciding what benefits to offer as a part of your benefits program, provide various flexible benefits that support all the generations in your workforce. For example, while Baby Boomers favor more traditional benefits like health insurance and 401(k) matching, younger generations like Millennials and Gen Zers seek more "non-traditional" benefits like supporting their mental health and overall well-being. By being in tune with what your employees want, you can invest in better benefits programs that support your employees' wants and needs.
Reallocate budgets from underutilized benefit programs
Chances are your employees aren't using all your benefits programs to their fullest extent—you probably have benefits programs that very few use. However, unutilized or underutilized benefits programs cost your company a lot of money, so it's worth exploring whether these benefits are necessary. First, audit your benefits program to see what your employees use and aren't using. To do this, pull user and engagement data to see how many employees have signed up for your benefits programs, completed tutorials and training, and taken advantage of other related activities.
If you're finding that there are programs that your employees need to leverage, consider reallocating the budget for that program to another program. You can offer new benefits programs that your employees find value in through reallocation without finding new funding. For example, employers offer life planning accounts (LPAs) to employees to support their well-being. An LPA is a type of employee spending account that relies on an allowance from the employer to fund the program. The money for the program has to come from somewhere, so what better than it coming from another underutilized benefits program?
Look to convertible benefits
Your workforce has several different needs, so a one-size-fits-all benefits package approach no longer cuts it. Benefits packages need to be flexible and customizable to meet individual needs. Convertible benefits are the way to do this. Convertible benefits give employees a flexible and customizable option to leverage the benefits that fit the most with their needs and lifestyles. They meet employee demands and can evolve as your employees' needs evolve.
Convertible benefits, like PTO, can allow employees to leverage the benefits that matter the most to them. American workers fail to use hundreds of millions of vacation days, costing companies tens of billions per year. Instead of letting the value of your employees' PTO go to waste, let them convert it into causes that matter most to them: student loan repayments, retirement contributions, emergency savings, and more. They can even donate your unused PTO to other employees in need.
Don't skimp on employee benefits
Employee benefits are important. If anything, you should increase them in light of a recession, not eliminate them. That said, you can take steps to save money on your programs in a way that benefits your employees and your bottom line. For example, employees find value in convertible benefits, saving the company money. Learn more about how PTO Exchange can give your employees a way to convert their unused PTO into the benefits that matter most to them.