The start of the end may be near for what appeared to be an employee’s job market, which sprouted during the Covid-19 pandemic, as employers are starting to turn the tables by cutting back on competitive benefits for employees.
Benefits such as phone discounts, gym memberships, 401K plans, dental insurance, transportation assistance, etc., which once were used as incentives to attract job applicants, have been getting the boot this year as employers battle higher costs due to high inflation and interest rates, according to a new Glassdoor analysis.
Related: Amazon’s remote employees now risk getting the boot
“These declines have, for the most part, been more pronounced in industries that experienced turmoil in 2023, such as tech and finance,” the analysis read.
During the pandemic, the job market was an employee's playground. Employees abandoned their current jobs in search of ones that better supported their needs during a tough economy, which left employers desperate to fill numerous open positions.
In 2020, one in five employees voluntarily changed employers, according to a 2021 IBM survey. Amid the rise of remote work culture, 32% of the people surveyed said that they changed jobs for work location flexibility. Also, about 1 in 4 people surveyed said they changed jobs because they wanted better benefits and support for their wellbeing, and were also in search of a salary increase or promotion.
The shifting job market has caused companies to roll out competitive benefits to retain and attract talent. A 2021 care.com survey, which polled 500 human resource and CR-suite leaders, found 98% of the respondents planned to newly offer or expand at least one benefit in the near future. Some of those benefits included health and dental insurance, home office stipends, retirement plans, fitness discounts etc.
As the job market is starting to cool with fewer job openings and a slower employee turnover rate, it is no surprise that employers are starting to cut back on benefits as costs to retain employees have increased over the year, and the pressure of a tight economy is started to weigh heavy.
According to new U.S Bureau of Labor statistics, compensation costs for civilian workers rose by 4.3% in September this year compared to the same month last year. Also, wages and salaries increased by 4.6%, and benefit costs rose 4.1% over the year as well.
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