Talent Tuesday: Are salary and work-from-home benefits enough?

Here’s what younger employees really want

By Dr. Viral Patel, CEO and Founder, Radish Health
Twitter: @radishhealth

In the U.S., there are nearly 5.5 million more jobs open than there are people to fill them. HR leaders scramble daily to introduce new benefits — including flexible hours and nitro coffee taps — in attempts to stay relevant to younger workforces and boost recruitment and retention. Unfortunately, these solutions just aren’t cutting it.

While benefits like catered lunches, raises, or even wellness stipends have been alluring in the past, these perks are now expected by many Millennial and Gen Z employees. As such, these benefits are poor magnets for new talent, and an even worse retention strategy, as employees know they can find those perks at other companies offering higher salaries.

Instead, improving talent hiring and retention for the shifting workforce starts with understanding the core values that drive younger generations to join, or leave, organizations in the first place—and that’s health and mental wellbeing.

The workforce of today

As Gen X approaches retirement age, Millennials and Gen Z employees are taking over as the prominent generations represented in the workforce. In fact, by 2025, it is estimated that Millennials and Gen Z employees will comprise more than 75% of the U.S. workforce. What does this mean for HR departments? We will have to be better at strategically recruiting and retaining younger talent.

According to a 2022 industry study, 40% of Gen Z workers and 24% of Millennials are planning to leave their job within the next two years. Furthermore, roughly 30% of both groups are willing to leave their jobs without another job lined up.

While some attribute these short tenures to digitally-fueled discontent or self-serving attitudes, historically, switching jobs has always been more common in youth than middle-to-late age workers. As such, now is the time to ensure that our organizations are set up to retain key young talent so that, when they find the right long-term fit, it’s within our organizations. By first understanding what these employees want—not just what they expect—and then creating benefits that meet those underlying needs, we can see measurable improvements in retention, loyalty, and overall employee satisfaction.

Treating the symptom, not the disease

Working as an emergency physician, I saw patients repeatedly come into our emergency department complaining of specific symptoms—only to receive a treatment that alleviated the symptoms of pain but failed to address the underlying cause. The reasons for this varied; sometimes, the patient failed to attend needed follow-up care with a primary care provider or required ongoing treatment not conducive to the acute care system. However, until that underlying condition was directly addressed, those patients would undoubtedly continue to come and go.

Companies unknowingly do the same thing with their employees. Leadership may read surveys or industry reports where Millennial and Gen Z employees report wanting better flexibility, autonomy, or mental health coverage—and quickly rush to implement work-from-home options and mental telehealth platforms or EAPs. But when yet another employee leaves after 18 months, the HR department is left wondering why. Our workplaces are still treating symptoms—not diseases.

Surveys show that younger generations demonstrate a keen interest in health and wellness compared to their parents and grandparents, often spending more on organic foods, exercising more, and smoking less than prior generations.

As a result of this emphasis on health and wellness, when Millennial and Gen Z employees are asking for specific benefits, they’re really asking for a workplace that respects and supports their overall physical and mental wellbeing. By providing flexible schedules or work-from-home options, employers are really reducing the time their employees spend on stress-inducing commutes. By offering unlimited PTO, employers offer an opportunity for escape when the employee is feeling burned out, and EAP programs provide someone to talk to in moments of stress or crises. But all of these benefits react to problems, rather than preventing them from happening, and ultimately fail to demonstrate the commitment to whole-person wellness that these employees value most.

Holistic health benefits drive the wellness younger generations crave

While 74% of Millennials surveyed would prefer a telemedicine visit to an in-person visit, HR departments are still seeing under-utilization of telemedicine platforms in these and younger generations. Similarly, while 66% of companies are expanding benefits to improve mental well-being, utilization of such benefits like EAPs remain at roughly 10%. Why? Many of the benefits available today are offered within siloed systems that fail to address the employee as a whole.

By understanding the core values driving acquisition and retention, departments can create holistic benefit packages that address both the physical, mental, and emotional wellbeing of employees through one, cohesive program.

For example, rather than getting a different doctor each time the employee uses a telemedicine platform, having a specific primary care provider or therapist assigned to take those appointments, make follow-up calls, and answer text questions helps the employee feel known and understood as they develop a relationship of trust. This trust enables the employee to receive better care from a doctor who sees the whole picture—especially when available mental health services are closely coordinated with traditional medical care. And when multiple health services—such as primary care, mental health care, and nutritional counseling—are all offered under one benefit platform and login within 24 hours, it makes utilization that much easier and accessible for better engagement and higher patient satisfaction.

Empowering employees to be “all in”

If we want the people we hire to be “all in,” it starts with us as organizational leaders. Our benefit programs must be structured around supporting cohesive, whole-person wellness. Further, employers have to take the time to understand what employees truly want and need from their benefits – it’s not nitro coffee taps. Rather, recent data shows that 84% of employees would be attracted to a new job if it included access to good medical or retirement benefits.

By ensuring we provide the health-supportive flexibility employees have come to expect with traditional perks like PTO and work-from-home alongside true health and wellness value adds that speak to employee needs today, organizations can tap into, attract and retain the rising Millennial and Gen Z workforce—through the labor shortage and beyond.