Today’s employees expect compensation in different forms and for different motivating reasons. The stable annual salary with the opportunity for a company-wide bonus or raise within a few percentage points of each salary is a concept that’s become increasingly outdated.
2016 marked a continued effort from employers to bring more holistic compensation models into the workplace. These models, updated to reflect the motivations of Millennials in particular, include a strong dose of flexibility and short-term rewards for achievements and milestones. Beyond financial compensation, employers are also moving towards a “balanced life” approach to benefits, ensuring that employees have access to health and wellness resources, flexible PTO, and career development opportunities.
Performance-based rewards
The dated model of company-wide raises in a mere 3-5% range is quickly losing traction and relevancy. Small to mid-size companies that are able to introduce change more quickly are experimenting with incentives and raises that reflect specific achievements for each individual employee. These incentives could come in the form of a check around the holiday season, a thank you gift card or check for a job well done in a big meeting or project, or a quarterly bonus.
On a company-wide scale, one might encounter more profit-based incentives at year-end. In other words, employees might expect a check that is tied to the performance of the entire company. This approach helps to build community rather than isolating employees for their individual performance rewards. The idea that “we’re all in this together” comes through when everyone shares a small amount of the overall profit.
In general, today’s employees should expect less increase to base pay and more focus on performance — both individually and company-wide.
Work-life balance
Due to high costs of health insurance for employees, many employers are looking at other ways to provide value in their benefits packages. For many, this means a move towards “quality of work life” or finding “work-life balance” with resources from the employer. This may come in the form of gym reimbursements, fitness trackers for employees, healthy lunch deliveries, stock-sharing programs, career development courses, and more.
Many Millennials are drawn to these updated forms of compensation that allow them to build a healthier work-life routine with the help of their employer. A major attraction in this vein is the ability to work remotely or arrange more flexible working hours. With technology bridging many gaps for remote work, Millennials in particular are keen to stay home once a week, or even just twice a month, and stay up to date on their work from a laptop.
Spotlight: Creative & Marketing Industry
Although some companies lose budget for their creative hub first when finances get tight, the forecast for the creatives and marketers of the U.S. looks solid going into 2017. Across the board, designers, digital creatives, and marketers are benefiting from the industry’s demand that companies use their own “voice” to stand out in a crowded market. Check out Adecco’s compensation report here for a breakdown of salary ranges based on location and job type!