"It is vital for today’s employers to create and maintain an overall employee value proposition that matches demand from the Millennial workers who will drive these companies forward," Aronson says.
Chicago, Illinois (PRWEB) December 10, 2015
Today, a Millennial Benefit Preferences (MBP) study found that nearly 75 percent of Millennials are unhappy with at least one company benefit or perk. Administered by FC Consulting and sponsored by Peanut Butter, Inc., the study uncovered the traditional benefits and perks offered to help attract and retain top talent may be outdated.
The MBP study – which surveyed college-educated Millennials’ benefits preferences and analyzed corresponding employer implications – discovered student loan matching as the top benefit Millennials requested. When polled and given the choice between two job offers, 85 percent of Millennials said they would accept a job if the employer offered student loan repayment.
At 34 percent of the American workforce, Millennials are the largest generational segment of American workers. This figure will climb to 50 percent by 2020. What’s more, 40 million people hold student loans, including 71 percent of the class of 2015.
“The fact is, Millennials are the future leaders of America,” said David Aronson, Founder and CEO of Peanut Butter. “Companies who seek out this smart pool of talent need to study their employee value propositions and deploy incentive packages that drive the highest return for their investment in people.”
Understand and Attract the Millennial Recruit: The average student debt in the U.S. is nearly $31K, which means that a Millennial earning $50K per year will spend more than 10 percent of his or her take-home pay on minimum monthly payments for the next ten years. For many people, this is the third highest line-item in their personal budget behind rent and food and often greater than the cost of owning a car.
Build A Culture That Keeps Employees Around: Companies that are providing Millennials with the opportunity for impact and flexibility in their work schedule are building environments where young employees will thrive. Those companies have an opportunity to further enhance their employee value proposition with targeted benefits. Survey respondents indicated a willingness to stay at least 36 percent longer (1.3 additional years) at a job when an employer is willing to contribute to the repayment of student loans. Even further, more than twice as many respondents expressed a willingness to stay at least six years when student loan contributions are offered.
Make Smart Investments In Total Compensation: When competing for talent, it’s easy for costs to get out of hand – offering the same 401(k) match as competitors, paying health and supplemental insurance premiums, company paid meals and more. All of these factor into an employee’s total compensation, so it’s important to understand how employees value these rewards. The study asked respondents to allocate employer spend across various benefits and perks and found that the average respondent prefers student loan repayment almost twice as much as 401(k) contributions, two times more than health insurance contributions, seven times more than free food, eleven times more than gym memberships and twelve times more than enhancements to the workplace environment.
Consider The Impact of Your Compensation Package on Diversity: The analysis revealed four distinct clusters, including one that was so much in favor of student loan repayment, that respondents from this cluster preferred it 18 times more than 401(k) contributions and 23 times more than health insurance contributions. Interestingly, this group was 57 percent female versus an overall sample that was 50 percent female, and 56 percent minority ethnicities while the total sample was comprised of 43 percent minorities. For companies in industries like technology, where there is a dearth of female talent, the implication of offering this one additional benefit may have a meaningful impact on diversity.
Unlike prior generations, Millennials have increasingly low job tenure, and those turnover costs can be substantial for employers – lost productivity, organizational strain, increased hiring and training expenses. Aronson says, “It is vital for today’s employers to create and maintain an overall employee value proposition that matches demand from the Millennial workers who will drive these companies forward.”
For more information on the study, or to learn more about Peanut Butter, a benefit administration provider for student loan repayment, visit getpeanutbutter.com/MillennialBenefitPreferences.
About the Study
The Millennial Benefit Preferences survey was administered online in August 2015. It received 400 responses from individuals age 21-34 with at least some college education. The study was sponsored by Peanut Butter, and the survey was designed, administered and analyzed by FC Consulting, a DePaul University student group comprised of Master Degree candidates in the Marketing Analysis discipline.
About Peanut Butter, Inc.
Peanut Butter helps companies provide a unique student loan benefit to attract and retain Millennial employees. By facilitating company-sponsored contributions to employee student loans, we help employers reduce turnover and hiring costs, differentiate their employee value propositions and aid in the solution to America’s $1.2T student debt problem. Peanut Butter, Inc. is a Chicago-based benefits administration company incubated at 1871, an entrepreneurial hub for digital startups.