The modern workforce is unlike any group that preceded it — between the rapid evolution of modern technology and shifting priorities of younger generations, today’s leaders must pay careful attention to employee trends to most effectively support their teams.
Employee trends can and should be used to inform many different facets of a company’s strategic decisions, but it is especially important to leverage these insights to inform your organization’s benefits strategy.
Benefits encompass everything from the health insurance plans available to employees, to peer-to-peer rewards and recognition programs to your company’s vacation policy. These things combined with more traditional forms of pay together compose a company’s benefits package. A company’s benefits package is a critical factor considered by job seekers, also affecting job satisfaction and, consequently, organizational success.
Understanding the key employee trends that are shaping the future of the workforce can help benefits leaders develop a deeper understanding of what their people need to feel supported and fully enabled to succeed. Below, we share five important employee trends modern leaders should keep in mind and explore how each relates directly back to a competitive benefits strategy.
1. Employee Turnover Rates Are Increasing
Employees are leaving their jobs faster than ever, and they have been for a while. One study found that since 2010, rates of turnover have increased by 88% with no signs of slowing down anytime soon. When employees leave their roles, it costs anywhere between half and twice as much of that individual’s salary to find and hire a replacement. Gallup estimates that on average, employee turnover costs U.S. companies $3 trillion per year.
Of all the employee trends included in this article, we chose to share this one first because it paints a clear picture of the pressing need to develop a competitive benefits package. The most commonly cited reason employees leave their jobs is a desire for better compensation — meaning higher pay, but also better benefits. If you want to attract and retain the kind of top talent that your organization truly needs to succeed, it is critical to develop a benefits strategy attractive enough to keep these people at your company.
2. There Are More Generations Included in the Workforce than Ever
With Baby Boomers, Gen X, millennials, Gen Z, and the “Silent Generation” all working, today’s workforce contains more generations at once than it ever has before. This is due in large part to increased lifespan and delayed retirement.
For business leaders, this particular employee trend means dealing with varied, sometimes competing values and priorities — and nowhere does this become more evident than when crafting your company’s benefits package. Employees from different generations want different things. As Baby Boomers near retirement, they place an increasing emphasis on health benefits, while Gen X is all about work-life balance and millennials seek opportunities for meaningful work.
The best way to accommodate all these preferences is through an employee rewards program that enables abundant choice. Programs like Fond let employees cash in redeemable points in exchange for a reward of their choosing. If that person is a member of Gen X, maybe they use points to buy an extra day of PTO. If they’re millennials, they might translate their points into a donation to a charity of their choosing. Whatever the selection, employee rewards programs are a great way to ensure there are benefits to suit everyone’s interests.
3. Hiring Managers Are Combatting a Massive Skills Gap
When sources discussing employee trends reference the “skills gap,” they’re talking about the mismatch between the skills employers need and the skills job seekers and current employees actually possess. Presently, the gap is a big one and it’s only continued to broaden. If left unaddressed, the skills gap is estimated to cost the U.S. economy $2.5 trillion dollars over the next decade.
One fantastic benefit that directly addresses this employee trend is opportunities for professional development. In a happy win-win scenario, professional development programs are also correlated with increased job satisfaction and reduced turnover, and are frequently cited as a high priority for prospective job seekers.
As with employee rewards programs, it’s best to leave ample room for choice when selecting the professional development opportunities you plan to offer your workforce. Keep in mind that people have very different learning styles, outside-of-work schedules, and areas of interest, and try to include as much variety as possible in your program to accommodate these individual differences.
4. Mental Wellness Is Increasingly Prioritized
Thankfully, the past several decades have seen more and more discussion around and public awareness of mental health. That extends to the workplace as much as anywhere else, with employees increasingly speaking up about the resources they need to support the full spectrum of wellbeing.
This employee trend was in motion long before the crises of 2020 hit the workforce, but the pandemic created a significant (and much needed) surge in the quality of benefits employers offer employees to support mental health. Companies including Target, Salesforce, and PwC expanded the mental health benefits offered to employees in response to a year of unprecedented challenges, and by and large they’ve reported that the expanded benefits bring about positive results. When basic physical, mental, and emotional needs are met, employees are (unsurprisingly) a lot better equipped to excel in their roles.
Although the response to the pandemic is certainly heartening, companies still have a long way to go when it comes to providing the kind of mental health benefits employees really need. One study found that nearly two-thirds of employees still feel their company could do more to support mental wellness.
Individual wellbeing aside, the business case for including mental health resources in your company’s benefits package is also quite compelling. One study estimated that businesses in the United States forfeit $193 billion each year to issues related to mental health. Unmanaged mental illness can give way to a variety of work-related risks including increased accidents, workplace violence, and in some cases harassment and discrimination. To avoid these repercussions and give employees the benefits they want and deserve, it’s in your company’s best interest to get on board with this employee trend.
5. Remote Work Will Become the Norm
Before the pandemic, the workforce was already shifting towards remote work. The massive shift to remote work that happened in response to COVID-19 dramatically expedited the progress of this employee trend. Today, nearly 50% of the workforce is working remotely and many experts predict that the change will be permanent.
This employee trend means that many traditional benefits are no longer relevant. Catered office lunches have been replaced by meal delivery vouchers, team outings are now virtual, and employers may distribute a stipend to set up a home office instead of investing in the perfect office decor. Leaders are quickly learning that remote employees require an entirely distinct set of benefits, and the more you can be mindful of this employee trend the more future-proof your company’s benefits strategy will be.
Better Benefits, Better Company
Keep these points in mind as you design and execute your organization’s benefits strategy, and you’ll be a lot more likely to make decisions aligned with the things employees want and need most. When you have a solid grasp on the employee trends shaping the workforce, it becomes a lot easier to conceptualize how you should shape the benefits your company offers to best support employees. Crafting a competitive benefits package will help keep your current employees satisfied and additionally will attract top talent to positions at your organization. Considering employee trends is key to making sure your benefits program is top-notch.
We’ll conclude with an important reminder: the primary intention behind paying such careful attention to employee trends while crafting your benefits strategy is to deepen and refine your understanding of what your people need.
While trends are powerful, don’t forget that the individual members of your workforce can also be fantastic resources for gaining these insights. Remember to listen to individual employee voices — if nothing else, these should be the source of truth on the efficacy of your organizations’ benefits strategy. When you not only listen, but effectively respond to the things your employees say they need, you’ll help create a company that better supports its employees and in turn, employees that better support the company.
Katerina Mery is a Marketing Specialist at Fond with a background in cognitive psychology and a passion for improving the way people live and work. She especially enjoys learning about how to accomplish this through rewards and recognition. In her spare time, you can find Katerina running outside, admiring art, and exploring the latest and greatest local restaurants.