Workers may have rejoiced over big pay raises in the past two years, but the downside is they’re losing noncash company benefits, according to job and recruiting site Glassdoor.
In 2023, the top three benefit cuts were in mobile phone discounts, charitable gift matching and tuition assistance, Glassdoor said. Companies are looking for ways to cut costs to pay for huge wage hikes doled out to attract and retain workers and elevated inflation over the past few years. And with the economy slowing and competition easing for workers, companies are doubling down on trimming fat in 2024, Glassdoor said.
As companies pare back benefits, Americans will have to pick up the tab.
“A lot of these smaller benefits add up to an important part of household budgets,” said Aaron Terrazas, Glassdoor chief economist. “It’s another weight on consumer spending going into next year.”
Why are companies cutting benefits?
Companies know employees would notice and bristle at smaller paychecks. So, they find other not-so-visible ways to cut costs.
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“When people talk about compensation, they focus on pay and wages, which are still growing more than 4% a year,” Terrazas said. “But that doesn’t capture the full extent of the total compensation package including benefits, which has grown much more slowly.”
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