Hoping to offer budget-friendly employee incentives? Find out how.
Some companies’ lavish employee incentives are almost legendary — Google’s free gourmet food, for example, or Virgin’s unlimited vacation policy. Employees leave when they want to, for as long as they want to.
At many organizations, employees leaving can be cause for concern. British businesses spend a minimum of £4.13bn on employee turnover every year; turnover in the U.S. can cost companies 21 percent of an employee’s salary.
Work perks — like unlimited vacation time — provide a reason for employees to stay. Although other factors may convince them to ultimately leave, such as a desire to relocate to another city, employee incentives appear to have a positive effect on retention: A recent Glassdoor survey found four in five workers prefer employee incentives to pay raises.
However, extravagant work perks often aren’t cheap; and it stands to reason that companies that can’t afford to provide salary increases may not be in a financial position to shell out for luxury items.
Organizations without an endless employee incentive budget need to focus instead on low-cost programs that can help attract and retain workers. A few suggestions:
Offer education. Training is a win-win for both the organization and the individual: Both gain valuable skills in the process. Research indicates employees may react positively to their employer priming them for future roles — 45 percent of workers who planned to leave their job blamed their decision on an inability to advance in the company, according to a 2014 CareerBuilder survey.
Build low-cost, high-impact recognition programs. Nearly 90 percent of companies sponsor employee recognition programs, according to a WorldatWork survey. The reason? Employee recognition programs have a proven impact on employee engagement. To make it a successful work perk, however, your program will need to include planning, promotion and thorough evaluation so it sets and meets specific goals.
Pair employees with mentors to increase engagement. More than 80 percent of companies say their mentoring programs are moderately to highly effective, according to a survey from research provider i4cp. If you’re in the market for a few tips to establish an employee incentive-based initiative, check out our recent blog post on building the best mentoring program.
Focus on the basics. If your organization can’t afford some of the more extravagant extras, you may be pleased to find Glassdoor’s 2015 employee incentive survey respondents ranked some fairly common work perks as their most-wanted. Healthcare insurance was the highest-ranked employee incentive, followed by vacation and/or paid time off, performance bonuses, paid sick days and retirement plans.
Quirky work perks, free courses and a robust vacation plan are just some of the tools organizations can use to increase employee engagement and recruitment.
Other factors — such as a solid communication policy and an emphasis on treating remote offices with respect — can be as important as benefit-based employee incentives to ensure workers feel valued and want to stay on board.
The recommendations in our recent blog post on how to solve your most critical internal and external talent pool issues provide additional guidance to help strengthen your organization’s succession planning efforts and company culture — without blowing your budget — to help keep employee satisfaction and talent attraction levels high.