Perk-Cession: Benefits are Being Slashed to Cut Costs But Do Employees Even Care?

A "perk-cession" refers to the trend of employers reducing workplace perks and benefits. Businesses realized they may have introduced perks too hastily, as employees now prioritize perks that enhance their overall quality of life and work experience. Perks beyond standard benefits are:

• Reimbursements on Gym membership
• Social events
• Company outings/retreats
• Free meals
• Conferences
• Home office stipends

READ ALSO: Top Ten Perks That Win Tech Workers Over, Says ex-Meta Recruiter

Why is Perk-Cession Happening?

Google is reducing employee perks like fitness classes and some office equipment to save money, as reported by CNBC. Meta, the parent company of Facebook and Instagram, is also cutting back, ending free laundry and dry cleaning services for employees and scaling back on remote work, which was previously a coveted perk. Salesforce recently discontinued the "well-being day" it had introduced during the pandemic, which provided employees with an extra paid day off each month.

Recent data from Care.com shows that nearly half of companies consider reducing benefits to brace for a potential recession, including adoption and fertility assistance, commuter benefits, health and fitness discounts, and home office stipends. Care.com surveyed 500 U.S.-based human resource leaders and professionals for these results and found that industries with more planned cuts than average include the food and hospitality, retail, manufacturing, and construction sectors.

Do Employees Even Care?

Perks such as commuter benefits, adoption assistance, and health and fitness discounts save workers hundreds or even thousands of dollars. By cutting these perks to save money, organizations shift costs onto employees, significantly impacting their finances, says Tate Hackert, President of ZayZoon.

Providing value-based perks is crucial for fostering a productive and engaged workforce. With meaningful benefits that reflect the organization's culture and core values, employees feel appreciated as part of a team and give them access to resources for managing financial, emotional, and professional stress.

How Can Companies Respond To Perk-Cession?

With important decisions ahead that will affect your business during these challenging times, it's crucial to prioritize your employees, as they are your most valuable asset. To keep your employees informed, consider the following steps:

• Communicate transparently: You need to be honest and clear with your employees about the company's challenges and the actions being taken. Regular communication through emails, town hall meetings, or one-on-one talks can foster trust and keep employee spirits up.
• Gather feedback and act on it: Employers should ask employees for input on which benefits and perks they value the most and make informed decisions about that feedback.
• Focus on non-monetary perks: Consider providing low-cost perks that are still valuable to your employees, like offering flexible work hours, training opportunities, or recognition programs to keep employees engaged and loyal.
• Be creative: As a business owner, be inventive with the perks you provide to compensate for cuts elsewhere. Involve your leaders/managers in this effort. For example, consider organizing a monthly team-building event or a fun office challenge instead of offering free lunches daily.