Is job loyalty dead? How employee benefits can be a key differentiator in a competitive job market

Traditional notions of employees spending their entire careers with a single company are gradually giving way to a new reality.

Loyalty was once viewed as a fundamental aspect of the employer-employee relationship. However, the modern workforce has undergone significant changes. In recent years, employees in Singapore have been disappointed by annual increments that are unable to keep pace with inflation¹, with reports of junior tenured employees earning even less than new hires. 

Suffice to say, the illusion that job loyalty was ever a two-way street has been irreversibly lifted.

It is no surprise, then, that 92% of Singaporeans who started a new job in the past year remain open to exploring new opportunities², even though the majority of them are satisfied with their salary. In fact, over 40% of Singaporean workers say that they will quit their jobs for better work-life balance³.

As a result, employers are facing the challenge of retaining their top talent. Higher turnover rates as a consequence of evolving job loyalty perspectives also means a more competitive job market. Amidst this competitive landscape, employee benefits packages can serve as a crucial differentiator, offering companies the opportunity to stand out and foster loyalty among their employees. 

Employee benefits encompass a range of offerings that go beyond just salary, including health insurance, retirement plans, paid time off, parental leave, professional development opportunities, and flexible work arrangements. Here are 3 reasons they can be highly effective in attracting and retaining talent.

1. Establishes loyalty as a two-way street, especially among younger talent

Having a meaningful and generous employee benefits package establishes loyalty as a two-way street. This is important to young workers in Singapore, who demand to see tangible proof that employers are not merely paying lip service. It is not uncommon now for younger employees to pose challenging questions about what employers can offer them, instead of the conventional other way round where employers ask what employees have to offer.

“Right now, it is kind of the employee interviewing the employer,” said Mr Piperdy, the founder of events company Unearthed Productions.⁴

While long-term job loyalty may have evolved, loyalty to a company can still be cultivated through an attractive benefits package. When employees feel their employer genuinely cares about their overall welfare, they are more likely to remain committed.

2. Increases employee satisfaction

Job satisfaction is strongly tied to the benefits provided by the employer. Employees who feel supported through benefits like health coverage and work-life balance programs are more likely to be content and committed to their job. They are less likely to seek opportunities elsewhere, reducing turnover rates and preserving institutional knowledge. Satisfied employees are also more willing to go above and beyond their official duties for the company, resulting in increased productivity and results.

“Staff retention strategies in the new normal have evolved immensely. Beyond competitive compensation, there are many ways that employee benefits can help improve staff satisfaction and retention,” remarked Primus Lee, Executive Director and Head of Employee Benefits at Howden.

For example, with today’s highly segmented workplaces, employees have disparate needs and offering flexible and varied benefits will improve inclusivity. Instead of offering standard coverage, why not provide options and flexibility for employees? Allowing employees to select what matters most to them will bring greater satisfaction and increase inclusion and belongingness.

3. Widens pool of prospective hires

In a competitive job market, a comprehensive benefits package can serve as a magnet for skilled professionals. Prospective employees are more likely to choose a company that values their well-being and offers perks that align with their needs and values.

According to Randstad’s 2023 Employer Brand Research Singapore report⁵, 79% of Singapore workers found non-monetary benefits important in their employee experience. Jaya Dass, managing director at Randstad Singapore, explained, "In the new social contract between employers and employees, companies are expected to provide a more holistic work experience rather than simply matching pay expectations. In order to attract the right talent, companies will have to prioritise creating a supportive work environment where people feel valued and empowered."

The right employee benefits programme can serve as a key differentiator in attracting and retaining top talent, especially in a competitive job market where employees are evaluating employers on a multitude of factors beyond compensation alone.

It’s time to give your employee benefits programme an honest look

While the traditional concept of job loyalty may have evolved, the importance of retaining a dedicated and skilled workforce remains unchanged. Higher turnover rates as a consequence of evolving job loyalty perspectives also means a competitive job market, where employee benefits can serve as a key differentiator in attracting and retaining top talent.

Employers who invest in comprehensive and tailored benefits packages demonstrate their commitment to employee well-being, job satisfaction, and overall success. By focusing on the diverse needs and priorities of their workforce, companies can foster loyalty, reduce turnover, and position themselves as employers of choice.

¹ Commentary: Employees pay a hidden tax by staying on with their companies, channelnewsasia.com
² Job Loyalty Wanes: 90% of New Hires in Singapore Still Eyeing Other Job Opportunities, sg.news.yahoo.com
^3  5Over 40% of Singaporeans will quit jobs for better work-life balance, sg.news.yahoo.com
⁴Understanding why millennials and Gen Zers feel the way they do about work, todayonline.com