Beyond the Paycheck: Using Fringe Benefits to Attract a Broader Pool of Applicants

Many firms in tight labor markets recruit for highly gender-segregated occupations, leaving them, in effect, drawing from only half the potential labor pool. We study how firms can use fringe benefits to attract workers and influence occupational choice. Unlike occupation-specific recruiting strategies, fringe benefits can be added to any occupation; they are also easily tailored, implemented, and scaled. Using a personalized and incentivized discrete choice experiment, we present participants with job options that match their skills and work task preferences. Within each option, we vary salary, occupation, and fringe benefits that adolescents had classified as gender-neutral, male-typed, or female-typed. We find that fringe benefits are highly valued: their effect is around a third as large as having prior interest in the occupation. Neutral and stereotypical benefits in particular improve perceptions of the firm across multiple dimensions. Furthermore, we find substantial gender differences. Female-typed benefits deter male participants, whereas all other benefit-participant combinations have a positive effect. Female participants value benefits more when those benefits are paired with an atypical occupation, and we find suggestive evidence that this reflects benefits alleviating concerns about limited support in such roles. In addition, male-typed benefits can increase the attractiveness of gender-atypical occupations for female participants. Female participants who consider atypical occupations place relatively higher value on these benefits and tend to exhibit less traditionally feminine preferences. We also find suggestive evidence that anticipated social reactions, particularly from parents, accompany these choices.