Compensation and benefits packages are used by companies to retain and attract talent. Benefits can be used to keep employees happy at work and to up your overall productivity. In this economy it is vital to offer competitive compensation and benefit packages to assist in the retention as the economy rebounds from its current state. In order to offer a competitive package, you should be aware of the types of employees you are looking to attract and also the employees that are currently working for the company. There are three different generations of employees as of today: Baby Boomers (born 1946-1964), Generation Xers (born 1965-1976) and Millennials (born 1977-1995). They all have a certain aspect that can be essential to the organization. There is no generalized form of compensation and benefits to cover all of these generations; therefore you need to produce multiple packages that are appealing to different generations. Just like there is no generalized form, the costs to the employer varies from industry to industry and especially when considering private versus public sectors. Benefits are essential to gaining and retaining employees and to properly weigh benefits against one another it helps to find the cost relative to what is made by the employee hourly.
Baby Boomers, who were born anywhere from 1946-1964, have a different preference in what they would like to see in a compensation and benefits package. They prefer to save and think ahead as compared to the other generations because of the experiences they have had. Baby boomers find their sense of self in the work that they do and are very loyal to one company, staying there until retirement is what they prefer. They will remain committed to one company as long as the employer meets their needs of security and retirement.
Generation Xers, born anywhere from born 1965-1976, have a need for work-life balance. They are willing to take less compensation, but prefer better benefits such as a flexible schedule in order to spend time with their families. They want a company that will empower them while giving them options for flexible working. This generation likes a challenge in order to find career development. They also look for direct and honest feedback on their performance.
Millennials are the youngest generation currently in the workforce, born 1977-1995, and also the largest. This generation is looking for compensation that includes a total life package. They look for traditional benefits along with flexibility, health programs, technical gadget, and dress code flexibility. They have a strong feeling of the need to succeed and look for education reimbursement and training wherever they can. This generation has a tendency to get bored quickly and look for advancement in expanded amounts of responsibilities, special projects, and opportunities for leadership.
There is a difference in the benefits offered by larger companies as opposed to smaller or emerging businesses. Small business cannot compete with large companies with the benefits they offer. With the large number of employees large businesses have the employees have more power to negotiate for more favorable benefits and services. Though the standard benefits packages may be different there is overlap. A standard package typically consists of some sort of standard healthcare coverage, 401(k) plan or similar, and a few other fringe benefits that will be covered later. The benefits of smaller businesses are not meant to compete with the large corporations but with one another. However benefits may differ from one place of employment to the other there are some standards that legally must be required. Legally required benefits
There are a few types of benefits that are legally required by law to offer to employees. According to the Bureau of Labor and Statistics the average amount committed by the employer to employee compensation, hourly, was $28.89 as of December 2012. These...