Employees today evaluate their compensation in holistic ways, looking beyond their salaries to aspects that enhance their lives and foster greater career success. With budgets tight and costs on the rise, business leaders should know there are lots of very desirable alternatives to employee pay raises. While fair salaries remain crucial, there are numerous elements that can add tremendous value to an employee’s total compensation package, some of which might be more affordable than offering raises.
Let’s take a look at some of the top alternatives to consider.
Financial Literacy and Planning
Financial education offerings have truly been on the rise lately. In a 2023 study from PwC, close to two-thirds of employees say that money is the top cause of stress in their lives. This stress often spills over into the workplace, impacting productivity.
As many as 68% of people report taking full advantage of the financial education programs their employer provides, such as coaching, workshops or webinars. Employees want to secure their futures and feel confident in their finances. It might sound surprising, but many employees may jump at this kind of offering in lieu of a pay increase.
The positive thing for employers is that partnering with a local financial institution to offer these services will likely be cheaper than a payroll increase. There may also be additional partnering incentives to discover too, plus the added rewards from having a more focused and committed workforce.
Professional Development, Training, and Growth
Investing in professional development for employees is a strategic move that pays dividends in the long run. This is actually one of the most sought-after things by employees in today’s markets. The Society of Human Resource Management (SHRM) reported that as many as 40% of employees “worry their job skills will become outdated because of advancements in technology.” That figure is likely to grow over time.
Offering training programs and growth opportunities not only fosters skill enhancement but also demonstrates a commitment to employee career advancement – which people very much appreciate. This alternative, while impactful, often comes at a fraction of the cost of traditional salary increases.
Childcare and Eldercare Programs
We all have people we love. But there’s no doubt that balancing work responsibilities with family obligations is a common challenge for many employees. Recognizing and addressing these needs can significantly contribute to employee satisfaction. It’s a powerful way for employers to show their support.
In a 2023 survey by Catalyst, as many as 75% of workers said they would use childcare benefits, such as onsite childcare and back-up or emergency childcare, if their organization provided them. Furthermore, 70% of working parents said they would be more likely to choose an employer that provides childcare benefits over one that does not.
Additionally, 59% of employees would use caregiving benefits for elder care or the care of other relatives if available from their organization.
By providing support in this essential aspect of employees' lives, employers not only ease the burden on their staff but also contribute to a family-friendly workplace culture.
Extra Vacation Time / PTO
Offering extra days off is often cheaper than a pay raise, and employees will love it. While a pay raise involves a recurring and ongoing expense for the company, extra vacation time is generally a one-time or intermittent cost. Employees take time off sporadically, allowing the company to distribute the financial impact across the year.
Companies have a lot to gain here too. The positive impact on employee well-being and job satisfaction can contribute to long-term savings through increased productivity, reduced turnover, and improved recruitment efforts. This can be a valuable non-monetary benefit that will appeal to many employees, while contributing to a positive employer brand.
Money Isn’t Everything
Money isn’t the only thing that matters to most employees these days. People want to feel supported, encouraged to grow, and have a little extra time for work-life balance. The good thing is, there are many ways to meet those desires without stretching a company’s payroll budget.
By adding some of the alternatives mentioned here, companies can save big while receiving the added bonus of happier, more committed employees. That’ll be a major win in the long run for just about any firm.
