When it comes to giving benefits packages to hourly employees, the general consensus among most employers is that the costs and work that goes into creating a benefits package is more than they will get out of it.
Businesses can create a big advantage for themselves by providing hourly employees with benefits such as 401k options, store discounts, and healthcare coverage. At the end of the day, offering hourly employees benefits will save employers time and money by improving retention, engagement and quality. Businesses are catching onto the advantages. Some of these companies are small, but most of them are very well known companies such as, Starbucks, Trader Joes, Land’s End, and Whole Foods.
Let’s look at a few of the advantages companies have recognized by providing benefits to their hourly employees.
- Employee Retention: All have seen a rise in retention rates. In a one year hiring period since starting their benefits package, Purk & Associates, has retained all of their employees. Having a high retention rate saves employers a lot of money overtime. Training takes a lot of time and if the ‘new hire’ ends up leaving a month later, that time and money is wasted.
- Employee Engagement: Most employers are constantly looking for ways to ‘up’ employee engagement. According to Gallup, loss in productivity costs the United States $450 billion- $550 billion per year. It’s no surprise that Starbucks has a turnover rate of 9%. Starbucks offers its hourly employees who work 20 hours a week or more, bonuses, 401k, stock options, health care, and tuition reimbursement. Providing employees with benefits is one of the simplest and most cost effective ways to keep them engaged and save your business time and money.
- Quality Employees: Every business is seeking top-quality employees. Some of the traits of great employees would be that they are knowledgeable, hardworking, successful, engaged, and passionate. By offering employees benefits, the employer is creating a workplace that shows the employee they care. When an employee feels like they are needed and that their job is worth something, this causes them to have a drive to be successful and passionate about their job. Ultimately this leads to better customer service, in turn resulting in higher customer retention rates and revenue.
Giving benefits to your employees is a win- win for everyone. Your employees will be happy, stay engaged, and stick around for the long haul. The business will generate more revenue because you won’t be investing time and money into employees that could care less if they leave a week later.
If you want to learn how other companies have been successful from offering benefits check out this article companies offering benefits to part-time employees.