Startups Are Using Unique Benefits to Compete For Talent

A competitive job market has forced companies to offer expanded employee benefits

Soon after the start of the COVID-19 pandemic, the marketing company Buffer adopted a four-day workweek. The decision was made due to the pandemic and team feedback surveys. Employees have been severely impacted by the pandemic and the restrictions that came with it. Parents — who now make up around 30 percent of the company — have been especially hard hit by the pandemic.

Buffer shifted to a four-day workweek to support the parents and avoid burnout for all employees. One of Buffer's newest perks is the shortened workweek, which is now one of the features that sets it apart in a competitive hiring market. The four-day workweek is an edge because it's such a competitive job market.

In a fiercely competitive talent market, startups are looking for applicants. According to the most recent release from the Bureau of Labor Statistics, the unemployment rate in the United States fell to 3.6 percent in March. After a record year in venture investment, startups flush with cash set lofty hiring goals, but they will face more competition as the "Great Resignation" progresses. 

This implies that traditional startup perks — such as arcade games and daily catered lunches in the office — are no longer enough for businesses that want to appeal to the best employees. The tech sector's reputation for generous benefits and better pay has helped it stand out in the crowd. Tech employers still have a long way to go to compete for talent in 2022. 

Employers are reacting by increasing salaries, offering flexible schedules, providing more paid time off, and now employers are even offering subsidies for fertility treatments, gym memberships, and child and eldercare.

Workers want more than just salaries

It's not just about money. Employees also want perks that promote work-life balance. According to Dice, 27% of technology employees consider child and elderly care a significant advantage, yet just 10% said they received it. 

“If you’re not offering work from anywhere, if you’re not offering unlimited PTO if you’re not celebrating that PTO and making sure people are actually using it … you’re falling behind,” said Jordan Peace, CEO of lifestyle benefits marketplace Fringe. “They went from nice-to-have to must-have to table stakes really fast.”

Talent has placed remote work as a high priority, and the job market reflects that. According to LinkedIn, the percentage of paid job listings on the platform that included remote work increased 357 percent between 2020 and 2021, with media and technology having the most remote employment postings overall.

However, the most significant advantage differs from individual to individual and even changes over time for an employee. For example, a monthly fitness stipend may be an important incentive for someone who likes working out, but not everyone has the same priorities.

Fringe, a lifestyle benefits marketplace, allows businesses to provide points to staff for whatever benefit they choose. An employee, for example, could use their employer-granted points to pay for a fitness membership or an Airbnb credit. Food is the most popular choice among Fringe platform's top category workers. DoorDash orders, meal kits from Blue Apron, grocery delivery, and coffee subscriptions are all popular perks on Fringe. That makes sense, given that everyone requires food, but it gives individuals the freedom to choose. 

In March 2022, the platform's most popular vendors were DoorDash and UberEats, followed by Airbnb and Uber. Given the pandemic, neither Airbnb nor Uber was among the top 10 locations where people spent their points in April 2020.

It's critical to let employees pick their own options. If you don't limit people, you can't say that you need to care about your health or that you must spend this money on your student loan repayments.

Companies must support their employees

In 2022, Seismic's benefits underwent a major transformation. Because the organization has employees in seven countries, it is behind in offering benefits that other countries demand. One of the most widely discussed changes was the announcement that the firm would be offering egg freezing and IVF treatments through its insurance carrier.

While considering what incentives to provide to attract talent, Seismic took a look at its rivals. Employees want to be supported in more than one way. There are numerous benefits that, alone, will never attract or keep workers. Seismic is a firm that wants to create both professional and personal success for employees. These sorts of benefits are sensitive to all employees, including those who want to start a family today or later.

There's a lot of pressure on employers to manage and support the overall person these days. The Worldwide ERC^®  article, A Silver Lining in the Pandemic, by John Lambo, speaks to the fact that the pandemic has shone a light on the complexity of humanity. Many aspects of employees’ lives contribute to overall well-being. Because of this, a whole-person approach is needed now more than ever.

Employers who don't act will be those who are most impacted by the mass resignation. There’s an expectation now that employers should manage and support the whole person — the employee both at work and at home. Those employers that don’t step in will be the employers that the big resignation will be affecting.