Do I Need an Employee Benefits Strategy? Why Benefits Matter Beyond Enrollment

If you’re struggling to attract or retain employees, you may assume the answer is higher pay, better benefits, or both. But there’s another question worth asking: What does your benefits package say about your company? 

An employee benefits strategy isn’t simply about choosing which benefits to offer or maximizing enrollment. It’s about intentionally building a benefits package that supports your business goals, meets your workforce’s needs, and communicates that your company is prepared to invest in its people. 

That matters even when employees don’t use every benefit you offer. 

In fact, a strong benefits strategy can influence how prospective employees perceive your company before they ever accept an offer and how current employees feel about staying long-term. 

Key Takeaways 

• An employee benefits strategy should align with your company’s hiring, retention, and business goals. 
• Benefits can influence an employee’s perception of an employer even if they never enroll in or use every benefit. 
• Health insurance remains an important part of the benefits conversation, but it is only one piece of a broader strategy. 
• A thoughtful benefits package can help communicate stability, competitiveness, and investment in employees. 
• Businesses should evaluate benefits based on both utilization and the message those benefits send to current and prospective employees. 

What Is an Employee Benefits Strategy? 

An employee benefits strategy is a plan for how a business chooses, structures, and communicates benefits to support both its employees and its broader business objectives. 

Rather than asking, “What benefits can we afford?”, employers should also ask: 

• What benefits matter to the employees we want to attract? 
• What does our benefits package say about our company? 
• Are our benefits competitive within our industry and market? 
• Which benefits support employee retention? 
• Are we offering benefits employees can realistically afford and use? 
• How can we provide meaningful benefits without creating unnecessary administrative work? 

The goal isn’t to offer every benefit available. It’s to create a benefits package that makes sense for your workforce and your business. 

Do Employees Really Care About Benefits If They Don’t Use Them? 

An employee may never enroll in your health plan. They may have coverage through a spouse. They may be young and healthy and rarely visit a doctor. They may prioritize salary, flexibility, or paid time off instead. 

That doesn’t necessarily mean the benefit has no value. 

In 2025, 61% of firms with 10 or more employees offered health benefits to at least some workers. Among firms that offered coverage, 80% of workers were eligible and 76% of eligible workers enrolled. 

So while not every employee will use every benefit, health coverage remains a significant part of the employer value proposition. SHRM’s 2025 Employee Benefits Survey found that 88% of employers considered health-related benefits very or extremely important to their workforce. 

When a candidate sees that an employer offers health insurance, retirement benefits, paid time off, and other meaningful benefits, they may interpret those offerings as signs that the company is established, competitive, and invested in its employees. 

What Does Your Benefits Package Say About Your Company? 

Think of your benefits package as part of your company’s first impression. A prospective employee may not know your leadership team, your workplace culture, or what it’s really like to work for you yet. They’re looking for clues. 

Your benefits can help answer questions such as: 

Is this company stable? 

A structured benefits package can communicate that the business has established processes and is thinking beyond the company’s immediate needs. 

Does this company invest in its employees? 

Benefits demonstrate that compensation isn’t limited to a paycheck. The employer is considering employees’ broader financial, physical, and professional well-being. 

Is this company competitive? 

Candidates often compare more than salaries when evaluating opportunities. Benefits can help an employer stand out when competing for the same talent. 

Does this company think long term? 

Retirement savings, health coverage, paid time off and professional development can all communicate that an employer is thinking about an employee’s experience beyond their first day. 

That doesn’t mean a benefits package alone will convince someone to accept a job. But it can contribute to the overall picture a candidate forms about an employer. 

Why Benefits Matter for Recruiting 

For many small and midsize businesses, competing with larger employers for talent can be difficult. A smaller company may not be able to match every large employer on salary. It may also struggle to compete when a candidate compares its benefits package with those of a larger organization. 

Health benefits can be particularly important because employer-sponsored coverage is a major source of health insurance for working-age Americans. KFF reported that in 2025, 91% of workers were employed by a firm that offered health benefits to at least some employees.  

This distinction is crucial for employers because not offering a benefit and offering one employees choose not to use are different. If an employee declines your health plan because they have other coverage, it still shows your company can provide it. For a candidate choosing between similar offers, that difference could matter. 

How Do You Know If You Need a Benefits Strategy? 

If your business is growing, hiring, or experiencing turnover, it may be time to take a closer look at your benefits strategy. 

Consider these questions: 

1. Are candidates asking about benefits during the hiring process? 

2. Are you losing candidates to competitors? 

3. Are employees leaving for larger companies? 

4. Do your employees understand what you offer? 

5. Have your benefits kept pace with your business? 

6. Are you choosing benefits individually rather than strategically? 

Benefits Are About More Than Utilization 

It’s easy to look at a benefits plan and ask, “How many employees are actually using this?” 

That’s an important question, but it shouldn’t be the only one. 

Benefits can have value beyond enrollment. 

They can shape a candidate’s first impression of your company. They can reinforce your culture. They can help employees feel supported. And they can signal to both prospective and current employees that your company is stable, competitive, and invested in its people. 

So, do you need an employee benefits strategy? 

If attracting and retaining good employees is important to your business, the answer is probably yes. 

The strategy doesn’t have to mean offering more benefits. It means being intentional about the benefits you offer, understanding why you offer them, and making sure they support where your business is headed. 

Ready to take a closer look at your benefits strategy? Talk with GMS about building an approach that works for your business and your workforce.