Understanding the Hidden Costs of Not Offering Employee Benefits

May 8, 2024by mycalchoice

Employee recruitment and retention are an everyday concern for businesses of all sizes. They can be especially challenging for small businesses which may have fewer resources and smaller budgets than their larger counterparts.

Your potential new employees – and your current ones – are comparing what you have to offer against other employers constantly. Access to that type of information has never been easy. What does that mean for you? Your recruitment and retention competition is virtually any business – a “mom and pop” store or small office, a big box chain, or a nationally recognized brand. That can be a daunting reality.

How do you compete?

Employee benefits go a long way in leveling the playing field. In today’s talent market, current employees and potential new hires expect benefits. If you don’t offer them, you’re taking yourself out of the competition and will likely face regular turnover.

What employees want: Health insurance consistently ranks among the most-desired employee benefits so it’s important to take note. With CaliforniaChoice, you can offer flexible employee benefits and control your costs. Our program includes eight health plans and 130+ coverage options. That means your employees can find coverage to fit their unique health care needs at a price you can afford.

Is cost a factor?

Cost is always a factor. But it’s important to consider the hidden costs of not offering benefits, too.

Turnover: Not offering benefits makes it difficult for small businesses to retain employees. If you have consistent turnover, that interferes with your productivity and that can be detrimental to your bottom line.

Recruiting: It takes money to recruit new employees . . . no matter how you go about it. Use a recruiter, and you’ll pay a percentage of your future employee’s annual salary. Run an online ad or use a job-posting site (like Indeed or ZIP Recruiter), you could spend hundreds per month. Get leads from employee referrals? That will cost you if you offer a reward for the referring employee.

Onboarding and Training: Once you interview and find your new employee, there are other costs. That’s because you’ll have to onboard them. HR paperwork aside, you also need to train them. That often means diverting other employees from their core jobs to provide support.

Explore Your Options

Clearly, offering benefits can help you attract and retain employees but there are several factors to consider when choosing a program for your business. Talk with a broker to explore your options and address your questions. If you don’t already have a broker, we make it easy for you to search for one here.

Shopping for group health insurance?

This guide compiles a list of common questions you may have before you start offering health insurance coverage.