One of the best ways for companies to get ahead is to have the right people on staff on an ongoing basis. However, while any manager will tell you that such a task is often far more easily said than done, there is usually one fairly clear path forward in this regard: Offering current employees and potential hires alike better pay and stronger benefits.
While some companies may balk at across-the-board raises, the following reasons to do so should help sway their decisions:
1) It encourages people to work harder
As a general rule, when people feel like they're not being paid well, they are less likely to put in a serious effort when they show up to work every day, according to Inc. By giving them more money for doing the same work, you're basically saying that you expect a higher quality in that daily output, and people are more apt to deliver it because they generally feel more valued as a result.
2) It can drive positive word of mouth
When your employees feel good about the new pay conditions (and possibly stronger benefits as well), they're more likely to tell other people about how much they like these changes, Inc. noted. That, in turn, can lead to a reputational boost for your company overall, but it could be particularly important when it comes to recruiting. When potential hires are able to hear through the grapevine that you're more generous with compensation, they may be more motivated to work for you.
3) It's great for attracting new talent
More than word of mouth, better compensation packages for new hires are also important for getting job seekers' attention in the first place, according to Newsweek. When people search for job listings, one of the first things they may check is how much the job pays and what kind of benefits they can expect to receive if they're hired. If your offerings are enough to grab their attention, you may be in a much better hiring position going forward.
4) It reduces turnover
Along with bringing in new people, higher pay and better benefits also help ensure people are content in their work and with their compensation, and therefore are less likely to look for other opportunities, Newsweek added. That, in turn, helps keep you running at full operational capacity, and saves you money because you don't have to initiate hiring processes on short notice.
5) It can improve workplace safety
As one final bonus that comes when you have more engaged, longer-tenured workers on staff, your company's safety record is likely to improve, according to Intuit Quickbooks. This is the result of experienced employees working harder and smarter, and reducing workplace accidents as a natural byproduct.
With all this in mind, it's important to consistently evaluate your salary and benefits offerings relative to your local competitors and adjust as necessary to make sure you're always in a position to stand out in your industry.