- Employers are using bonuses to attract new hires and reward employees who refer job seekers from underrepresented groups, according to the Nov. 29 results of a WorldatWork survey. Now, more often, such initiatives enable employers’ dynamic response amid a reported labor shortage in a second pandemic year.
- The WorldatWork 2021 Bonus Programs and Practices survey results show more than half (52%) of respondent organizations have offered sign-on bonuses to win candidates over the past 12 months.
- Of the four types of bonuses offered in recruiting efforts by these companies — sign-on, referral, spot and retention — the sign-on bonus at 79% was most common, but 7% of organizations surveyed said they use none of these bonus programs. Only 2% of organizations said they offer a higher referral bonus for candidates from under-represented groups, although 12% said they were considering this practice.
Many employers are creatively and aggressively targeting specific skill sets and demographics, "...paying greater referral and sign-on bonuses for hard-to-fill roles," according to a statement from Sue Holloway, director of compensation content at WorldatWork.
Employers’ use of referral bonuses to draw job seekers from underrepresented groups is a newer approach to establishing parity in workplace representation. With interest in bonuses up generally, survey results show that employers are now considering the role of payments in DEI efforts — another initiative gaining traction in recent years.
WorldatWork’s report also highlighted efforts by some employers to measure the effectiveness of bonus programs. Few respondents said they were doing so, but those who were cited interest in employee satisfaction and performance – perhaps a message about organizational valuation of employee experience, albeit delivered by a small representation of American business.
Despite this trend, worker advocates say it’s not one-time bonuses, but salary increases that will settle employers’ talent woes. On the whole, however, salary budgets will remain somewhat stagnant, with most reporting a 3% increase for 2022 in a recent XperHR survey — mirroring the average 2020 to 2021 increase.