Have a Benefits Problem? Best to fix it.

MGR Accounting Recruiters in
on Apr 25, 2015. Posted inBlogging In Balance

Recently I was speaking with an employer regarding a few open positions.  The conversation regarding benefits went like this:

Medical – Yes;  Dental – Yes;
Retirement – No match – it causes us recruiting issues sometimes.
Vacation time – Yes, but not too much – it causes an issue sometimes as well.
Bonuses or profit sharing – No, and we usually don’t mention that because…

In contrast, we had another meeting the same week with another company looking to hire several people…

Medical – Yes;  Dental – Yes;
Retirement – Yes, and we have a healthy match.
Vacation – Actually we give vacation plus an additional 2 weeks of sick time.
Bonuses or profit sharing?  We have both – annual bonuses plus profit sharing.
Me:  “Wow, you seem to have it all covered.”
Them:  “I think so… we aren’t sure what else we could add.”

*   *   *   *   *

Some benefits can be expensive to improve, particularly in the area of medical insurance.MGR Accounting Recruiters - Wrench - Fixing your benefits  However, benefits truly are an area where job candidates expect a certain minimal level of ‘benefit’, and that is dependent on the job market and what other employers are offering.

In our experience, candidates tend to expect medical coverage, paid-time-off, and some way to save for retirement… practically in that order.  It is difficult to compete for the candidates you need unless you have the medical cost for the employee covered at a high percentage, vacation and sick leave that is over 2 1/2 weeks (and actually more is becoming common), and some type of retirement plan – preferably with a match of 3% or more.

The purpose of this post is simply to make one point… if you know your benefits are lacking and it causes you to have difficulty attracting the talent you need for your company, then it’s best to do the same thing you would do with any other business problem – develop a plan to fix it.  This doesn’t mean that you will be able to offer every benefit immediately, but you can at least decide on what milestones (profitability, revenue size, etc.) you will use to determine when to improve your benefits and then slowly improve them to the point where they do their job and attract the talent you need.

While benefits are certainly not the most important item in the recruitment process, they can actually be one of the easiest items to alter to attract the right candidates.  Paid-time-off and retirement matching are relatively inexpensive areas to improve from a hard cost standpoint, particularly when compared to the cost of not getting the best person for your open position.  Not being able to hire the best person for the job tends to be much more expensive in the long run than making a small improvement in a fringe benefit.

Until next time, I wish you the best in all your searches.

Mark Goldman CPA