Reasons Why Workers Prefer New Benefits to Pay Rise

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Reasons Why Workers Prefer New Benefits to Pay Rise

According to research conducted by Glassdoor, four in five workers stated that they would prefer new benefits to a pay rise. The job market confidence in the United States has increased over the past years, and the job seekers are no longer worried about job security but the benefits they will attain signing a contract with a certain company. Due to this, many people prefer companies that will provide valuable benefits and not necessarily a pay rise. With an increased number of job seekers in preference of new benefits to pay rise, employers, therefore, are left with no option rather than adapting to the market demands implying that employers need to offer more than just salaries to their employees in order to effectively compete in the current labor market.

Companies that offer perks and new benefits stand a better chance of recruiting potential employees as the perks and benefits can be considered a recruitment tool. In the current generation of millennials, employees tend to flock to employers who will help them achieve a healthy balance between work and their private lives (Newman). Besides, the millennials tend to possess strong value systems and also perceive employment as a way or an outlet to which they can use to help themselves and the world better. To the millennials, helping the world is not only about paychecks, and thus, the salary expectations among the employees tend to be lowered. Besides helping the world and themselves better, the millennials demand for new benefits and perks is an indication that they desire to live a lifestyle that they are capable of maintaining by themselves and thus doesn’t need to rely on their employers in any way to sustain their adopted lifestyles.

There are many reasons why people are preferring more benefits to pay rise. Among the benefits is that there is peace of mind among the employees. Though it is hard to measure the peace of mind, many employees say that they enjoy more freedom from benefits than pay increment. For example, most of the potential young workers are already prescribed to college loans, which gives a hard time paying back. Due to this, many of these young workers are greatly attracted to companies that would assist them in repaying their loans, since most of them focus on repaying the college loans rather than starting any investments as they await the future retirement plans from their employer which they will use in investing (Martin and Robert).

On the other hand, old workers experience various issues that include health, family, and also need time for accession as well as future retirement plans. Due to this, older employees get more focused on their health, dedicating more on health insurance and retirement plans. Lack of security in health insurance and retirement plans imply a completely ruined future due to inadequate finances, and thus the short and long term plans are greatly hindered. For the old workers, therefore, it would be better if the employer focuses more on health insurance and retirement plans as the workers will not work forever. Older people are associated with degenerative conditions and thus need more money to cater for their health plans. They also need more money to care for their life after retirement since, at that time, they might be dependent on relatives and need money for their basic needs. A higher pay would not be able to accomplish such aspirations as money at hand will be subject to misuse, and therefore the employer needs a better plan to secure the future of their workers.

Another reason as to why most of the workers prefer new benefits to pay rise is due to taxation. According to my opinion, the more pay one is engaged to, makes them advance to a higher tax bracket and thus more taxation in the amount provided. Due to this, the increment in the real sense is minimal, and the worker may not be able to fix their problems with the increment. As a result, workers argue that when the company offers for vacation, not only for staff but also to their families, it makes great sense as the company often caters for every expense. However, an increment in pay will hinder such plans as a vacation as the little money obtained after taxation will be hard to budget and account for, making it hard to realize personal goals. Having the employer provide such benefits also will help the employee be able to tour the world, an opportunity which would have been rare if they were left to do it alone. Besides, in the case of new mothers and fathers, providing a paternity and maternity leave fully paid will also attract more workers as it would be a challenge for a person to work for a company that will not provide paid leaves.

Perks and benefits, aside from the retirement and healthcare benefits, lifestyle options improve the quality of life to a great extent with such benefits such as commuting subsidies, gym subscriptions, and eldercare (Shields and Andrea). The wellbeing programs which focus on the physical, mental, and financial, along with the social aspects of the workers, tend to be centered around helping the employees overcome the financial and emotional stress, for example, for the student loan debt, which stresses fresh college leavers. Performance bonus, on the other hand, acts as a way of promoting the employees’ creativity and hard work, which increases the productivity of the company. When workers are paid performance bonuses, they tend to feel appreciated and therefore develop a strong sense of belonging to the company. The benefits provided to the workers are of great help and helps them achieve more compared to a pay rise, and thus, many employees prefer perks and new benefits to pay increase.

Works Cited

Martin, Thomas N., and Robert Ottemann. “Generational workforce demographic trends and total organizational rewards which might attract and retain different generational employees.” Journal of Behavioral and Applied Management 16.2 (2016): 1160.

Newman, Terri L. The generational divide: Implementing a work/life balance policy to improve the organizational culture within the workplace. Diss. Keiser University, 2016.

Shields, John, and Andrea North-Samardzic. “10 Employee benefits.” Managing Employee Performance and Reward: Concepts, Practices, Strategies (2015): 218.

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