Employee Compensation Trends in 2022

John Anthony Almerino

January 25, 2022

Employee Compensation Trends in 2022

June 19, 2023

Employee Compensation Trends in 2022

WWith the start of a new year, it may be too early to tell whether the Great Resignation is still gaining momentum or starting to die down. But one thing is clear. It is not over. The turnover rates and the number of job openings are still at historic highs as competition for talent remains fierce. For most companies and businesses, recruitment and retention are and will still be major hurdles to overcome.

In a labor market where employees and workers have the power of choice to leverage, employers need to recalibrate their strategies to ensure that they will be able to meet their expectations. Employee compensation definitely will continue to play a big role. How organizations approach compensation this year will surely be interesting. 

Current trends in employee compensation

The post-pandemic era has truly changed the workplace and employee compensation is one of those subject matters that are being reexamined and redefined. What we are seeing in 2022 is an employee compensation trend on non-cash benefits that promote worker well-being and quality of life. 

Remote work flexibility as a key benefit

In a previous blog post, we remarked that even with the worst of the pandemic now hopefully behind us, remote work is not going to fade away. Remote work is most likely going to be a defining feature of the post-pandemic world, especially those that work in tech and knowledge-based industries in general.

The ability to work anywhere and anytime will be a key benefit that most workers will continue to demand. What started as a solution necessitated by a crisis will probably now become a work arrangement option that they will expect to have. Save for a few exceptions, employers who are unwilling to provide their workers with remote-work options will struggle to find people who are fine with being deprived of this highly sought-after benefit.


Wellness benefits


The past few years have been one of the most challenging ones in recent memory. In the workplace, the global pandemic not only had health and safety implications but also seriously affected everyone’s mental and emotional well-being. 

Burnouts became common while the line between life and work blurred as people worked from home. Productivity increased at the expense of workloads becoming more burdensome for a lot of people. The departure from set working hours in an office ushered in the need for people to figure out their optimal work-life balance.


In response, this year will possibly mark the resurgence of company benefits focused on worker well-being such as “wellness leaves.” Organizations might also look into programs designed to protect and foster the mental and social well-being of their workers including access to meditation and wellness apps and in-person classes. Wellness benefits will become more and more common especially in light of studies that show that these types of benefits can help reduce attrition rates.


Shortened workweeks


There have been a lot of talks about a 4-day workweek (or shortening the workweek in general), but this year might be where it finally takes off in some sectors and industries. Taken together with the demand for flexible work arrangements and the renewed focus on employee well-being, a shortened workweek will fit comfortably in the ongoing conversation. This also follows the trend of working smarter, not harder. With workers focusing on the quality of work done and tasks completed, rather than working for hours or doing busywork.


Short workweeks will also be a viable alternative benefit for companies that are unable to pay higher salaries. In fact, the same amount of compensation for lesser hours of work per week is still a net increase in the hourly rate.

The rate of employee compensation matters. It is and will always be the primary consideration and main motivator for workers and employees. But with inflation being at record-high levels plus the prospects of an economic downturn, not everyone is in a position to offer bigger compensation packages.

Alignment with company goals and values

Aside from that, workers are now putting more value and emphasis on company culture and purpose. Companies and organizations that are able to foster a community and align everyone towards a common objective will not only find it easier to attract key talent but also retain and engage existing ones.

This underscores the need for compensation packages to not just be high or astounding, but also effective and meaningful. Equity and equity-like plans are good examples of alternative compensation models that are able to achieve both. For example, vested shares from a successful startup may, later on, prove to be more valuable than a high salary. Moreover, an ownership stake fosters alignment between the company and workers and addresses the human need to belong in a community with a shared vision.

Why is it important to have a good compensation package for employees?

A good compensation package is important as both a recruitment and retention tool. Obviously, a decent compensation plan allows you to attract and recruit top talent. Additionally, for those that are already part of your team, providing good employment benefits and compensation ensures that your key employees stick with you in the long run as they feel appreciated and valued.

Provide Meaningful Compensation for Employees with Upstock

Solutions like Upstock (for traditional companies) and Uptoken (for crypto companies) help you provide meaningful compensation to your workers. We help reduce costs and streamline the deployment process of high-quality equity and equity-like plans. 

We help companies and workers find the perfect sweet spot on the sliding scale of wages and equity that will leave both parties aligned and satisfied when bringing on a new team member to the company. Learn more on how this could be done by reaching out to us here.

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