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As sluggish wage growth continues, many companies are offering benefits designed to entice workers.
Take a look at any of today’s headlines, and you will find HR issues that affect our employees, our organizations and the entire profession. The minimum wage debate continues to rage at the state, local and federal levels. The clash between new and traditional employment models is becoming sharper and more politicized (think: Uber vs. the taxi industry). And landmark U.S. Supreme Court decisions on health care and marriage also have implications for us and the way we do our jobs.
One recent Bloomberg headline, in particular, caught my eye: “Benefits Are the New Salary.” The article, based in part on SHRM’s 2015 Employee Benefits survey, reported our finding that 35 percent of organizations have increased the number of benefits they provide to workers over last year. Spot bonuses, more-generous leave policies, special employee programs such as shopping discounts, and a smorgasbord of other wellness benefits—from gym memberships to health and lifestyle coaching—are on the rise.
What has not been on an upward trajectory is workers’ pay. Government data show that employee earnings have been stagnant for the past five years. This has policymakers and economists worried, as higher pay is needed for a full U.S. economic recovery. We also see workers expressing their concern, as turnover continues to rise sharply and nonunionized employees call for a higher minimum wage.
Should HR professionals and employers be just as concerned that benefits are increasing while wages remain flat? Is it an either/or proposition? Or is the Bloomberg analysis of SHRM research correct? Are benefits, in fact, the new wages?
The answer is as unsatisfying as it is true: It depends. In SHRM’s 2015 Job
The answer is as unsatisfying as it is true: It depends. In SHRM’s 2015 Job Satisfaction and Engagement survey report, American workers said benefits were more important to them than overall pay/compensation, yet both factors are consistently ranked as top contributors to job satisfaction from year to year. Furthermore, workforce needs and wants vary from one organization and industry to another. Both benefits and salaries make up a considerable share of total employee compensation.
As with many human capital strategies, when it comes to rewarding employees, one size rarely fits all. Our responsibility as business leaders is to understand the needs of our organizations and workers, and to tailor compensation decisions and recommendations accordingly. Critical evaluation skills—one of nine competencies in the SHRM
Competency Model—enable us to collect, analyze, evaluate and apply data to develop this type of people management solution that makes the most sense for our companies. Read our feature, “An Analytical Approach to Benefits,” to learn how some HR professionals are using data to make health care, retirement and other benefits decisions for their employers.
Many issues of the day are HR issues. Let’s use our human capital expertise to guide our organizations through the current debate and to demonstrate the value and perspective that only HR can bring to business.
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