Human resource leaders commonly assume that for a company to stand out as a great place to work, it must deliver competitive material benefits.
However, new research finds that this view is outdated: engagement and retention don’t correlate with benefits because nowadays employees look beyond material offerings and instead they assess how they feel about the company they work for. Fortune 500 companies spend more on benefits and perks than ever, almost $2,500 a year per employee, on average.
But a study by the research and advisory firm Gartner, comprising global surveys of 5,000 employees and more than 150 HR leaders, reveals that employee engagement has been flat since 2016.
Carolina Valencia, a vice president in Gartner’s HR practice and one of the study’s authors says “Companies have been engaged in an arms race to offer the best perks. But once basic needs are met, people are more powerfully motivated by feelings than by material features. Employees today want to be treated as people, not just workers.”
Benefits managers should change their approach in order to offer a human deal that will make workers feel valued, supported and cared for financially, physically and emotionally. Researchers suggest following this advices:
Connecting with employees’ lives outside work.
Companies usually don’t care about employees’ non-work issues, in part because of privacy concerns, but researchers underline that the boundaries have blurred during the pandemic so workers don’t pretend that their work lives and outside lives are separate.
Many organisations allow remote work at least some of the time. But they should go further, aiming for radical flexibility in which employees ideally decide with whom, on what, and how much to work. Far from providing cover for loafers, Gartner finds, the adoption of radical flexibility raises the number of employees defined as high-performing by 40%.
Promoting personal growth
Most organisations offer programs to foster professional growth. But employees want opportunities for personal growth as well, such as career coaching, community service or language lessons.
Instilling shared purpose
Employees want to feel invested in their organisation’s purpose, including the ways in which it interacts with the larger world. Leaders may hesitate to highlight their activism for fear of alienating employees with dissimilar views, but such concerns appear to be overblown. Research says that workers prefer their leaders to take a stand on societal issues they care about. Researchers also suggest instituting regular meetings to discuss emerging issues with the whole company.
Providing holistic well-being offerings and helping people use them
Most large firms offer a variety of well-being programs but few employees take advantage of them because needs change from person to person and over time. Companies could encourage employees to assess their well-being and talk candidly about mental health and provide managers with a direction to follow.
Adapted from “Rethinking Your Approach to the Employee Experience” – Harvard Business Review 202202