Non-monetary Benefits: A Surprisingly Powerful Retention Tool
When it comes to employee retention, compensation is just the tip of the iceberg. Studies show that when employers provide generous non-monetary benefits, employee loyalty and longevity soar.
But what are non-monetary benefits, and why are they so powerful? Which ones resonate most with workers—and, most importantly, how can you leverage them with your workforce?
What Are Non-monetary Benefits?
Non-monetary benefits—also called non-financial benefits and non-monetary rewards—are all employee perks and benefits outside of compensation. Some non-monetary benefits examples include life and health insurance, PTO, employee recognition programs, and career development opportunities.
Although non-monetary benefits aren’t generally expressed in terms of dollars and cents—and some don’t even have tangible financial value—we know they are highly appreciated by workers.
For one thing, many non-monetary benefits are geared toward improving work life-balance, now a priority for employees. For another, such employee perks demonstrate that a company cares about its people’s well-being—and that speaks volumes, too.
The Power of Non-monetary Benefits
Research reveals that non-monetary rewards boost employee engagement, satisfaction, and especially, retention.
For example, one Microsoft survey found that employees’ top motivations for leaving a job include:
- Poor work-life balance
- Lack of flexible work arrangements
- Not enough PTO, and
- Employer indifference to employee well-being.
Interestingly, failure to receive a raise ranked pretty low on the list. It’s not about the money!
In addition, a LinkedIn study revealed that when employers provide a clear path to career advancement, employees stay twice as long as they do with companies that offer fewer internal promotions.
Plus, according to Gartner research, when employers provide vibrant employee recognition programs, employees are 56% less likely to consider leaving.
In this employee-driven job market, non-monetary rewards may serve as the tipping point as to whether employees stay or leave.
7 In-demand Non-monetary Benefits
When it comes to enhancing your non-monetary benefits portfolio, the possibilities are endless—but you may want to consider popular choices first.
1. Work-life Balance Initiatives
Programs that support superior work-life balance—i.e., PTO, parental leave, and childcare benefits—are one of the first factors employees ponder when making job-related decisions, so it makes sense to focus attention here.
2. Flexible Work Arrangements
Remote and hybrid work arrangements remain extremely popular with workers. As a growing percentage of employers make these their standard arrangement, companies who don’t are increasingly vulnerable to turnover. At the least, consider offering employees some flexibility in choosing their work hours.
3. Wellness Benefits
If you’re like many employers, you’ve already enhanced your wellness offerings post-pandemic, and that’s a good thing. Many workers, especially younger ones, expect employers to offer thoughtful mental health benefits, employee assistance programs, and holistic wellness initiatives—all of which prioritize employee well-being.
4. Recognition and Rewards
Humans crave recognition and appreciation. When employers formally applaud employee contributions through recognition and rewards, bonuses, and/or public acknowledgment, they increase employee engagement and satisfaction, which in turn boosts retention.
5. Learning and Development Programs
When employers invest in their employees’ professional development by providing learning opportunities, they not only help workers sharpen and expand their skills, but demonstrate that they value their people’s growth.
6. Career Development Opportunities
An employee who sees a clear path to career mobility with their current employer is less likely to look elsewhere. Emphasizing internal promotions and making career goals part of your performance review discussions give employees more reasons to stay.
7. A Positive Work Culture
A positive work environment, inclusive culture, supportive coworkers, good manager relationships…these are all important non-monetary benefits that go a long way with employees. Because if employees enjoy coming to work, experience job satisfaction, and know they are valued by their employer, why would they even think about looking elsewhere?
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