EntgeltPlus: Why employer attractiveness means more than salary today

June 22, 2026 6 min read

Hand holding paper figures that are holding hands

The labor market has changed

Many mid-sized companies face the same challenge: finding qualified employees and retaining them over the long term is becoming increasingly difficult.

Demographic change, the skills shortage, and changing employee expectations are transforming the labor market for good. Companies today no longer compete solely through their products or services, but increasingly through their attractiveness as employers.

Attracting new employees is only part of the picture. For many companies, it is becoming ever more important to retain existing teams over the long term, foster motivation, and keep knowledge within the company.

HR strategies therefore need to be planned with a longer horizon than just a few years ago.

Skilled workers are becoming scarcer

While the situation on the labor market varies by industry, region, and economic development, the underlying trend remains.

According to the KfW-ifo Skilled Labor Barometer, 21 percent of companies were still affected by the skills shortage in the second quarter of 2026. Small and medium-sized companies were somewhat more affected than large businesses.

A survey by the Association of German Chambers of Commerce and Industry (DIHK) also shows the persistent challenges. As early as 2024, 43 percent of companies reported having difficulty filling open positions.

Added to this is the demographic trend. According to the Federal Statistical Office (Destatis), Germany has the oldest working population in the European Union. Around 24 percent of employees are between 55 and 64 years old.

For many companies, this means that experienced employees will gradually leave the labor market in the coming years, while suitable successors are often hard to find.

The competition for qualified professionals will therefore persist over the long term.

Attracting employees is one thing – retaining them is another

Public debate often focuses on attracting new skilled workers.

For many companies, however, retaining existing employees over the long term is at least as important.

Every unplanned departure creates costs. Positions have to be re-advertised, onboarding ties up resources, and productivity is lost.

At the same time, the expectations of many employees have changed. Beyond salary, topics such as financial security, health offerings, flexibility, appreciation, and future prospects play an ever greater role today.

Employees have long since stopped seeing their employer merely as the one who pays their salary – they see an overall package.

Employer attractiveness is an economic factor

Employer attractiveness is often associated with recruiting or employer branding. In reality, however, it influences far more than the acquisition of new employees.

Employees’ emotional attachment to their employer plays a central role here.

The Gallup Engagement Index Germany 2025 shows that only around 10 percent of employees have a high emotional attachment to their employer. By contrast, 77 percent have only a low emotional attachment.

Study findings on employee engagement. Excerpt from the Gallup Engagement Index Germany 2025.

These figures illustrate the potential that lies in stronger employee engagement.

Emotional attachment affects not only employee satisfaction but also numerous business metrics.

An international Gallup meta-analysis of 347 companies with more than 3.3 million employees shows clear differences between companies with high and low employee engagement.

Companies whose employees have a high emotional attachment record:

up to 51 percent lower turnover
78 percent less absenteeism
63 percent fewer workplace accidents
32 percent fewer quality defects
higher productivity
better customer ratings
High emotional attachment holds enormous potential. Excerpt from the Gallup Engagement Index Germany 2025.

Employer attractiveness has thus long ceased to be a purely HR topic. It affects costs, productivity, employee retention, and business success alike.

Salary remains important – but often is no longer enough

Many companies initially respond to staffing shortages with salary increases.

A higher salary can be attractive in the short term. At the same time, this approach often runs into economic limits. Every additional euro of gross salary generates additional non-wage labor costs, and often only part of it actually reaches employees.

In addition, employees today expect considerably more than a mere salary payment.

Health benefits, retirement provision offerings, subsidies, flexibility, and additional support services are becoming increasingly important.

The question is therefore no longer solely how much companies invest, but how effectively these investments reach employees.

Many companies are already investing – but not fully using their potential

Most companies already invest considerable resources in their employees.

Beyond salary, there are often numerous other benefits:

company pension scheme (bAV)
capital-forming benefits
health offerings
non-cash benefits
mobility benefits
other voluntary benefits

Often, however, these instruments are introduced and administered independently of one another.

This creates a situation in which individual measures exist, but their impact remains limited. Employees often do not fully recognize the overall value, while companies find it difficult to assess the actual benefit of their investments.

The challenge, therefore, is not always to invest more money.

Often, it is rather a matter of using existing budgets more effectively.

From individual benefit to employer concept

A good example of this is the company pension.

Today it is one of the established components of modern compensation systems. At the same time, many companies offer other benefits such as subsidies, health offerings, or tax-advantaged benefits.

If these building blocks are viewed in isolation, their potential often remains limited.

Modern employer concepts therefore treat compensation, benefits, retirement provision, and communication as one interconnected overall system.

This creates several advantages at once.

Employers gain a better overview of their investments and their impact.

Employees better recognize the actual added value of their benefits.

And HR measures can be aligned more precisely with employee retention, employer attractiveness, and long-term HR strategies.

Communication determines success

Even attractive benefits only develop their full impact when employees understand the personal benefit they derive from them.

Many companies already offer valuable additional benefits that employees, however, are only partly aware of.

That is why transparency, clarity, and individual comprehensibility are crucial.

Only when employees recognize the concrete advantage that benefits, retirement provision solutions, or subsidies offer them do these benefits become a genuine part of employer attractiveness.

More impact from the existing budget

The labor market will continue to change in the coming years.

Companies therefore face the task of continuously developing their attractiveness as employers.

This does not necessarily mean incurring ever higher personnel costs.

Often the greater opportunity lies in using existing budgets more intelligently, combining benefits in a meaningful way, and making their value visible to employees.

This is exactly where EntgeltPlus comes in.

EntgeltPlus combines company pensions, salary-related benefits, company health insurance, and other compensation components into one integrated overall concept. This is complemented by digital advisory, communication, and implementation processes.

This turns individual benefits into a structured approach that helps employers deploy their investments in employees more effectively while sustainably strengthening the attractiveness of their company.

Modern employer attractiveness does not come from individual measures. It emerges where compensation, benefits, retirement provision, and communication work together in a meaningful way.