Could 2023 Be the End of Employee Perks?

We have a new victim of the economic downturn: employee perks.

Popularised last year by the many viral “day in my life as an intern” videos, a light has recently been shone on the vast amount of workplace perks offered at some organisations: the ping pong tables and beer taps of yesteryear have given way to on-site sushi, workplace gyms, and even in-office massage therapists.

Benefits such as these can be a powerful tool in differentiating employer brands in a crowded talent marketplace, and many organisations have made it their mission to establish their Employer Valuable Proposition as fun, engaging and wellbeing-focused places of work.

However, amid rising interest rates, fears of recession, and an uncertain economic outlook ahead, the era of subsidised Uber rides, free food, and in-office massages appears to be over.

Alongside a great restructuring of organisations in order to cut costs in an uncertain economy (the tech industry alone has cut nearly 95,000 jobs this year so far), we’re now seeing how organisations are focusing their attention on cutting employee perks in order to reduce overheads. Here are just a few:

Meta ditches the laundry

Meta (formerly Facebook) recently announced several reductions to their wellbeing arm Life@Benefits. The program was introduced to ensure their employees’ “personal and wellbeing goals were fulfilled”.

The cuts included a reduction of $1,000 per person from its health and wellness benefits, removal of their on-site laundry facilities, and axing the $200 a month employees would get for Lyfts. The company also did away with their Meta Days, an initiative introduced during the pandemic that gave extra time off to employees.

Google goes virtual

Google (eight-time winner of Fortune’s ‘Best Company to Work For’ title) is also turning its attention towards employee benefits as a cost-saving measure, with particular focus on their business travel expenses. Google employees have reportedly been instructed to favour virtual meetings and online social functions going forward, restricting in-person travel to “business-critical trips” only.

More recently, amidst the 12,000 Google employees let go in January 2023, Google also laid off 31 full-time massage therapists from their California campuses.

Salesforce cuts wellness days

Salesforce, celebrated for being pioneers of hybrid workplace wellness, recently axed their Wellness Days program in which engineers and technical staff would receive a paid day off once a month to devote to wellness. After announcing the end of the perk, Salesforce pointed to their flexible working policy as one way in which the organisation encourages their employees “to take time off and recharge in ways that best support their individual needs.”

Twitter axes training

In a recent email to Twitter employees from new CEO Elon Musk, Twitter has discontinued any costs associated with “wellness,” “productivity,” and “training and development,” along with home internet or WiFi costs. Expenses for other work-related costs have also been lowered, with Twitter’s mobile phone allowance being reduced to $50 from $150.

What do people think of employee perks?

It’s no secret that the pandemic has changed how we view the world of work: we’ve written at length about the Great Resignation, and how employees are increasingly realigning their needs in their search for Purpose.

A result of this transformation is a shifting expectation in the types of employee perks that people are looking for in their organisations: research has shown that flexible working hours, working remotely and time off rank far more highly than “gimmicky” perks like free snacks, office ping pong tables, or subsidised commuting costs that may have been considered attractive in an office-based and pre-pandemic world.

Researchers at the Institute for Employment Studies believe companies looking to remain attractive in a post-covid hiring market need to focus on the elements workers are increasingly seeing as valuable: training, progression, autotomy, and flexibility. In fact, 93% of employees say they will stay longer at a company if it invests in their development.

What can you do?

89% of L&D professionals agree that proactively building employee skills for today and tomorrow will help navigate the evolving future of work. If your organisation is considering a reshuffle of their employee benefits, why not add a Learning Budget to the mix? There are a myriad of ways to implement learning and development elements to your benefits offering – including self-led resources, skills sessions, or full learning events – that meet your peoples’ desire for flexibility and growth, while also meeting your organisation’s development needs (and budgets).