Recent employment market trends show that annual pay increases are becoming a relic of the pre-global economic crisis as organisations develop creative – and cheaper – methods to compensate their employees.
“More businesses are upping their spending on benefits such as one-time bonuses, health care and paid time off… Many are rolling out perks such as free gym membership, commuting subsidies, even pet health insurance,” writes Washington Post reporter Ylan Q. Mui in an article titled Companies have found something to give their workers instead of raises.
“Companies say they are catering to the growing workforce of millennials who seem to prize short-term flexibility over long-term financial security, and the change allows bosses to reward star employees without permanently increasing costs.”
Business Insider Australia published a list of the top 14 organisations in the world that have the highest level of employee satisfaction, judged by the best pay including salaries and bonuses as well as other benefits.
Not surprisingly, social media giant Facebook came out on top with an employee rating of 4.7 out of five. The average salary of those in the sample was £69,629 and comments included: “Smart people to work with, great benefits (free food for breakfast, lunch and dinner), a healthy work environment and an amazing working culture” – Facebook internet marketing analyst (London).
Facebook’s extra perks included a gym allowance and business class travel.
The top 14 list was based on a survey by Glassdoor, an anonymous employee review website, and most businesses were technology companies hailing from Europe or the United States.
But what about New Zealand employees – do they value more perks over money? The answer, according to a recent national survey, is yes.
Husdon New Zealand canvassed the views of 1,529 New Zealand employers and employees in its Talent Insights Report and found that employees would be willing to swap a pay increase for:
- More annual leave
- Bonuses and incentives
- Flexible work conditions
Despite the data, there are always two sides to every argument. Getting a salary right is a critical part of the recruitment process, particularly if you are trying to lure top candidates into senior management, executive and governance roles.
If professionals feel like their being underpaid, they may also feel underappreciated which can lead to a negative internal culture and create animosity between staff. This view was also highlighted in the report, with almost 39 percent of employees stating they felt they were underpaid, and when asked how much their base salary increased last year, 49 percent received no increase.
Of those employees who received an increase, 77 percent received a boost of between 1-5 percent.
The best way to ensure salary satisfaction is have good communication and maintain a level of transparency with staff during the recruitment process and employment. It’s important to review, and refer to, up-to-date salary data and clearly communicate this when making a salary offer. You should also highlight any added benefits associated with the role to ensure continued engagement and job satisfaction.
Finding the right leaders to take your business forward is imperative in today’s changing marketplace – and with almost 50 percent of New Zealand professionals willing to consider a new job if the right opportunity presents itself – it’s vital for your business to have the right strategies in place to keep your best staff happy.
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The Decipher Team
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