Over the past few months, we have talked a lot about what benefits and incentives matter most to employees. Perhaps unsurprisingly, employees are focused on competitive compensation and other cash-based rewards. But what about the benefits that employees need, but don’t rank as highly?
While vacation days are ranked lower on the list of benefits most important to employee satisfaction, we hear in the news over and over how important it is for employees to recharge out of the office—and how difficult it is to actually take that time. In fact, a recent Oxford Economics study finds that American workers lose 169 million days of paid time off each year. Yet our analysis reveals no clear payoff for employees for sacrificing their time off, as workers who do so are not more likely to get pay raises.
Using paid vacation days is good for everyone. Not only is it beneficial to employees’ health and productivity, it also allow the company to learn to function in their absence, says Megan McArdle in this article from Bloomberg. This raises some questions for management: How can companies ensure that employees are getting away from the office? What can employers do to create a culture that encourages taking well-earned time off?
Companies everywhere are struggling to develop leadership and learning cultures—this is even more true in certain regions. We surveyed executives across North America, Latin America, Europe, and the Middle East and Africa and found that workforce strategies are different around the world—as are the outcomes. For example, in the Middle East and Africa, companies are more likely to struggle with leadership and learning.
As the chart above shows, leadership is lackluster everywhere; just over one-third of companies say leadership talent is sufficient to drive global growth. But the situation is even worse in the Middle East and Africa, where just one quarter say so. Lackluster leadership often points to a lack of learning, as companies that are not motivating employees to learn and develop skills are not preparing them to be the leaders of tomorrow.
It makes sense, then, that the Middle East and Africa also are behind when it comes to learning and development. While the region is ahead in mentoring, it lags in retaining, updating, and sharing institutional knowledge; in creating a culture of continuous learning; and in offering incentives for pursuing further education. Meanwhile, executives in North America are ahead—though even those numbers are not as high as they should be. 56% say their company has a culture of continuous learning, and 47% say their company offers incentives for pursuing further education.
Workforce strategies vary by region, but everyone could use improvement. To better meet workforce goals, companies need to focus on learning and development. Finding better leaders who can drive global growth and manage an increasingly diverse workforce starts with developing talent.
Much has been said about what Millennials want most from work, but our research suggests that some of these ideas are not entirely accurate. It’s not that softer benefits like finding personal meaning in work don’t matter to Millennials, but that these things matter as much or more to older workers. In fact, it may be that non-Millennials are the group that’s more misunderstood.
Millennials and older workers place the same value on most workplace benefits and incentives. For both groups, competitive compensation is the most important factor in determining job satisfaction.
But our surveys do reveal one substantial difference between Millennials and older workers—the younger people expect more feedback. In fact, they expect feedback 50% more often than other employees. They are also more likely to say they get their professional development from formal training at work, and less likely to say they use self-directed learning.
So while companies should offer the same benefits and incentives to all employees, they should understand that their younger employees require extra help in terms of feedback and development.
The 2020 Workforce will be increasingly flexible. An increase in the number of non-payroll positions for consultants, intermittent employees, and contingent workers is forcing change on companies.
While executives know this will force change on their companies—42% say it is affecting their workforce strategy—they will need to put more thought into policies around compensation, training, and flexible work. To do this, HR management will need an accurate picture of their flexible workforces. Currently, only 39% say they have ample data about their workforce, and only 42% say they know how to extract meaning from the data they do have.
You can read more about the contingent workforce—and what it means for companies—in our research report, and we will drill deeper into the topic in a think piece and infographic to be released in the next month. Stay tuned.
Today at 1 pm ET/10 am PT, join Michael Zielenziger of Oxford Economics, Hy Pomerance of Impact International and former CHRO at New York Life Insurance, and Bhushan Sethi of PricewaterhouseCoopers for a webinar on leadership.
We’ll be talking about our research findings, which reveal a lack of adequate leadership at companies around the world. Listen in to the webinar to learn about:
- Leadership deficits at senior company echelons
- Employees’ dim view of middle and upper management performance
- A widespread lack of succession planning
- Unfulfilled employee expectations for guidance, development, and training
Click here to register for the webinar.
We’ve talked a lot about leadership on this blog. Our surveys show that executives don’t feel their companies have the necessary talent to manage diverse, global workforces, and that access to the right leadership is limiting growth initiatives.
The research also reveals that executives and employees don’t see eye to eye on several key issues. But leadership is an exception to the rule; employees agree that leadership in their companies is lackluster.
Just over half of employees say their manager performs well in terms of leadership, and fewer say their manager delivers on providing feedback, mentoring, and sponsoring them for training programs.
Employees say their manager delivers on…
Employees also report a lack of confidence in upper management. As the stats below show, companies are falling behind in terms of encouraging collaboration and diversity, cultivating leadership, and providing feedback.
Our Workforce 2020 surveys show that companies are not offering the benefits that are most important to employees—particularly compensation and other financial incentives, which are ranked highest among employees across the globe. Management may argue that companies cannot afford to pay more, but in at least some cases there is evidence that higher pay brings substantial benefits to employers as well as workers.
Why The Container Store Pays Its Retail Employees $50,000 A Year (Business Insider): The Container Store pays its employees nearly twice the national average. CEO Kip Tindell says that, for just two times the cost, he ends up with employees who are three times as productive.
Meanwhile, as executives focus on retaining top talent, companies offering unique benefits are grabbing headlines. And while these incentives may be good for employees, there’s usually something in it for the company, too.
Freezing Eggs as Part of Employee Benefits: Some Women See Darker Message (The New York Times): Some tech companies are now paying for female employees to freeze their eggs—and while some consider this a huge step forward for women struggling to balance childcare with career-building, others think the companies are avoiding putting policies in place for paid family leave, child care, and flexible work.
A Benefits Balancing Act (CFO): A recent study from CFO Research found that three-quarters of finance executives say it is important for companies to offer the right mix of benefits, and many are expanding the range of voluntary benefits they offer. Executive are hoping that more attention to offering the benefits that matter most to employees will help in long-term retention.