It is unrealistic to say that salary is not a factor when deciding whether to accept or remain in a job. Of course, it matters, and for many, it is decisive. However, it is not the only one, especially for the new generations of the workforce who seriously consider other elements, such as flexibility, sense of purpose, the possibility of professional growth, learning opportunities, and the commitment to the environment and diversity that employers and the workplace demonstrate.

Why is salary no longer enough for workers?

When it comes to motivating employees and understanding why they stay or leave a job, the new trend is to design total rewards. Although a competitive salary is undeniably important and can be a significant motivator, research shows that it is not always the main reason why employees make career decisions. Many workers today are looking for more than just monetary compensation. They want meaningful work, professional growth, flexibility, benefits, recognition, and a positive work culture.

“Yes, salaries are necessary for those of us who believe in a more conscious approach to a capitalist world; however, a good salary is not enough. People need education, empowerment, and support with their finances. Everything they care about (family, health, relationships, dream goals) depends on it,” says Aaron Velky, entrepreneur and thought leader.

Let's explore why salary alone is no longer enough to keep employees engaged and loyal to their organisations.

The need for meaningful work and professional growth

Employees want to feel that their work has a purpose and contributes to something bigger than themselves. A job that aligns with their values and allows them to have an impact, whether in their communities or their industries, can be an important motivator. Companies that prioritise meaningful work often see higher levels of employee engagement and retention.

In addition, opportunities for professional growth and development are critical. Employees don't want to feel stagnant in their roles. Instead, they look for opportunities to learn new skills, receive guidance, and advance in their careers. A clear path for growth within a company can be a more powerful retention tool than a pay raise alone. An employee who sees a clear path for growth and future promotion may stay with the company longer, even if their salary stays the same for a period.

Flexibility, work-life balance, and benefits are important

A top priority for many employees is work-life balance. The rise of remote and hybrid working has changed expectations, with employees now valuing autonomy to manage their schedules. Organisations that offer flexibility, such as remote working options and flexible hours, are more attractive to job seekers.

But, although this may be a topic for another discussion, it is important for employers who want to achieve comprehensive compensation to know that concepts such as flexibility and work-life balance are not a “one size fits all” for all employees. Evaluating the case and “customising” these packages is part of the commitment.

Patricia Grabarek, one of the authors of Leading for Wellness: How to Create a Team Culture Where Everyone Thrives, emphasises the importance of a personalised approach to work-life balance rather than adhering to a rigid set of rules. Patricia has been studying workplace wellbeing for over a decade and emphasises that true balance comes from recognising what energizes and fulfills an individual, encouraging people to define and reevaluate their own needs regularly.

On the other hand, comprehensive benefits play a crucial role in job satisfaction. Health insurance, retirement plans, and paid vacation are essential, but many employees also value non-traditional benefits such as wellness programs, childcare support, and mental health resources. This is a reality, especially for the younger generations.

“Companies that care about Generation Z would do well to address the issues that matter to this generation in their employee value proposition and ensure that the company demonstrates its commitment to the physical, mental, and financial well-being of employees,” said Ronald Seifert, senior client partner and North American total rewards leader at Korn Ferry.

Recognition, positive work culture, and mental health support

Recognition and appreciation are key to keeping employees motivated. Regular feedback and recognition of contributions help employees feel valued and increase job satisfaction. When employees feel that their hard work is appreciated, they are more likely to remain loyal to their company.

A positive work culture is another crucial factor. Toxic workplaces drive away talent, while inclusive and supportive environments attract and retain employees. A culture that fosters respect, collaboration and a sense of belonging leads to greater engagement and productivity.

A recent survey by Wondr Health found that 30.1% of employees believe that making friends is the key to fostering happiness at work, compared to only 12% who cited financial freedom.

In addition, learning opportunities and mental health support are essential. Continuous skills development ensures that employees remain competitive in the job market, while mental health resources such as counseling and stress management programs show that companies care about the well-being of their employees.

“Employees are nine times more likely to stay with their company for three years or more when they feel that their organisation cares about them as individuals,” according to a report by the Limeade Institute.

Companies that prioritise these factors, beyond salary, will have a competitive advantage when it comes to hiring and retaining the best talent. Today's employees want a workplace where they feel supported, valued and inspired to grow.

Salary is important, but organisations that invest in meaningful work, professional growth, flexibility, benefits, recognition, a positive culture, and support for mental health will build stronger, more engaged teams.

What do employees really seek in the workplace?

The key takeaways from the discussion tells us that employees today seek:

• Meaningful work: Employees are looking for purpose and impact in their jobs.
• Professional growth and development: Opportunities for learning and advancement are crucial.
• Flexibility and work-life balance: Remote working and flexible hours are highly valued.
• Comprehensive benefits: Traditional and non-traditional benefits are an important factor in retention.
• Recognition and appreciation: Employees want to feel valued for their contributions.
• Positive work culture: A supportive and inclusive workplace fosters engagement.
• Learning and mental health support: Continuous development and well-being initiatives are important.