There has been a streak of low unemployment numbers for many years now, and the Bureau of Labor Statistics confirms that the US job market is currently a ‘candidates’ market.’ The number of job seekers is less compared to the number of jobs created per month. Moreover, the search for super-skilled talent is becoming more difficult by the day because recruiters no longer have the upper hand. The candidates have become the decision-makers, thanks to tons of opportunities and the need to hire top talent.
So, how do you stand out and make your organization the most desirable? The answer is Employee value proposition (EVP). By offering a competitive Employee value proposition, organizations can not only attract the best talent but also retain current employees. Let’s understand it in detail.
What is Employee Value Proposition (EVP)?
EVP can be termed as monetary or non-monetary benefits that employees get in return for their service at an organization. Some employee value proposition examples may include perks, such as learning and development programs, monthly incentives, monetary compensation, etc. EVP or employer offering is known to establish an impressive employer brand while also boosting employee engagement.
An employee value proposition can be defined as benefits for employees in terms of value, support, and recognition for their loyalty towards their organization. An EVP has proven to be extremely effective in creating workplaces with satisfied employees who are naturally motivated to give their best.
Why Employee Value Proposition is Important?
The biggest benefit of an EVP is that it gives your organization an edge above others by creating a compelling employer brand, which, in turn, renders other benefits, such as:
Being Able to Attract Top Talent
A unique employee value proposition is a key driver of talent acquisition. An EVP enhances your employer brand, and it goes without saying that a great employer brand helps attract great candidates. For example, an organization that offers flexibility to work from home may naturally be a preferred choice since it would help employees maintain a better work-life balance.
Being Able to Retain Employees
According to Workonic, 73% of American employees today are passively looking for jobs, which means that employees wouldn’t hesitate to switch employers if the right opportunity came along. And losing talented people means having to find their replacements, who would take months before reaching the same productivity levels. This is where a compelling EVP helps. The perks and benefits as a part of the Employee Value Proposition (EVP) help employers earn the loyalty of their employees and stay a top choice. It is no wonder that Fortune 500 companies make enormous efforts to retain their employees.
Optimizing the Expenses of Recruitment
Recruitment is not just a time-taking job, but an expensive one too. With attractive employee benefits, it is natural to receive hundreds and thousands of applications from desirable candidates, which automatically cuts down the cost of reaching out to candidates. Consequently, the recruiters can save on job listing on expensive portals, paid job opening ads, marketing of the brand, etc., reducing the cost per hire.
Moreover, by retaining top employees through an EVP, organizations can avoid the unexpected costs of rehiring.
What Are The Elements of Employee Value Proposition (EVP)?
The main elements or components of EVP are:
- Financial rewards
- Employment benefits, such as paid leaves, health insurance, paid vacation, retirement benefits, memberships, etc.
- Career growth, learning & development programs
- A good work environment, including recognition, work-life balance, etc.
- Positive and collaborative company culture
Employee Value Proposition Examples
Yelp is a renowned crowd-sourced review forum that is known for exhibiting a strong sense of community within workplaces. The organization’s attractive EVP or employee value proposition includes gym memberships, healthcare benefits, unlimited snacks, and other perks that circle around employee happiness.
Canva is a popular Australia-based organization that runs a graphic design tool website offering its employees exciting and unique projects that contribute directly to their growth. The brand’s EVP includes gym memberships, in-house lunch and breakfasts, and a relocation budget – additional benefits of an already cool place to work.
Shopify is a Canada-based e-commerce platform for online stores and also an amazing organization to work in. The brilliant employee value proposition of the brand includes fully catered meals, learning and development budgets, and health benefits for employees and their family members. The brand is passionate about personal growth, and over the years, its self-directed learning programs have become its USP.
An America-based IT company, HubSpot is an organization with a sharp focus on learning, flexibility, and work-life balance. The employer offers fully remote working opportunities, parental leave, a five-year sabbatical, unlimited vacation, and many other compelling benefits that no employee would be disinterested in. The brand values the lives of employees outside of work.
A consumer goods company, Unilever is the seventh most valuable organization that lays a strong emphasis on building leaders. Its employees get to work alongside inspiring leaders – a must for dramatic growth.
Helpful Employee Value Proposition Statistics
- According to Gartner, an attractive employee value proposition (EVP) can reduce compensation premium by 50%.
- Annual turnover can be reduced by almost 70% with attractive EVP, as per Gartner.
- Happiness at the workplace led to a 12% productivity increase as per Fast Company.
- Google’s employee satisfaction rate saw a 37% increase after the introduction of employee support initiatives, as per Fast Company.
How to Create a Great Employee Value Proposition?
Follow these five steps to creating an attractive EVP
- Assess your current offerings.
- Interview your past and existing employees to understand what benefits employees prefer from their employers.
- Highlight the key components that you would like to include in your EVP.
- Prepare an employee value proposition.
- Promote or market your EVP and review the improvement in your employer brand.
How Are Employee Value Proposition And Employer Brand Related?
An employer brand communicates what a brand is all about, while an employee value proposition helps create a powerful employer brand as a result of marketing monetary and non-monetary employee benefits. By having a compelling EVP, brands can get an edge above their competitors, put in effective branding efforts, and become the top choices of potential candidates.