Amid a red-hot job market and the Great Resignation—which saw record numbers of employees voluntarily leaving their jobs in search of other opportunities with better pay, perks or work/life balance—employers touted a plethora of benefits offerings as they tried to sway potential workers to their organizations.
But change may be coming.
That's according to Indeed, which found that the number of job postings advertising benefits—such as health insurance, retirement plans and paid time off—has flattened in recent months after surging over the past few years. According to the Austin, Texas-based jobs site, the share of job postings on Indeed that mention health insurance rose to 48 percent by February 2023 from 31 percent in early 2020, while the number advertising both retirement plans and paid time off rose to 37 percent from 22 percent over the same period. That progress slowed in March.
The slowdown is especially prevalent in low-wage sectors, such as cleaning and sanitation, personal care and home health, security and public safety, and food preparation and service.
The shift comes on the heels of a changing job market, as employers start to become wary of economic pressures and a potential recession.
"The persistently tight U.S. labor market of the past few years and historically high nominal wage growth" have been the primary factors behind why more employers have mentioned benefits offerings in their job postings, Indeed researchers noted. But, they wrote, "the recent slowdown suggests that competition for workers may be softening, with employers feeling less incentivized to use benefits in recruiting workers."
However, there is a caveat: While fewer posts for low-wage jobs are touting benefits, job postings advertising similar perks among high-paying positions have risen. That's especially the case for those jobs promoting retirement plans: Since February 2022, the share of job posts in software development, banking and finance, and mathematics advertising a retirement plan have all grown by more than 50 percent, Indeed found. Paid-time-off benefit perks have also experienced growth in job postings in the banking and finance sector.
The recent growth seen in high-wage job ads, the Indeed researchers note, "illustrates that the cooling job market may not be felt uniformly.
"In other words, there are sectors where hiring remains relatively difficult, and where employers may feel compelled to continue sweetening the pot with enhanced benefits in order to attract the best candidates," the researchers said.
It's not the only change happening in job applications and advertisements: In separately released data, Indeed research recently noted that employer-provided salary information has surged in job postings. More than 40 percent of U.S. job postings on Indeed now include pay information, a 137 percent surge over three years.
The findings on benefits advertisements symbolize the economic paradox happening now: It's still a competitive job market—employment remains strong despite unrelenting high inflation and slow economic growth—but some employers are cutting back on jobs and benefits as they prepare for a possible recession later this year. Companies including Amazon and the Walt Disney Company have laid off thousands of employees, while other firms such as Google and Meta are cutting back on some benefits to reduce costs.
Those cuts may be playing out among job advertisements, although some industry experts say that actual cuts to benefits so far have been minimal across the board and primarily are affecting perks like free food, onsite gyms and transportation benefits rather than stalwart benefits such as paid time off and health care.
"The cuts that I've seen to this point tend to fall more under the category of what I would consider to be perks rather than the traditional benefits," Tony Guadagni, senior principal in the Gartner HR practice at Gartner, recently told SHRM Online. "Leaders are really hesitant to cut core benefits. I don't think they're going anywhere."