Structuring compensation that is both fair and encourages retention is no easy task. The pressure to reduce labor costs, increase productivity, and profit margins are contributing to the rise of contract employees in place of the traditional employee-employer relationship. Younger workers comprehend that long-term employment is less probable as technology and global workforces continue to expand, and the prospects for long term employment leading to an eventual retirement are not likely.
The Bureau of Labor Statistics (2018) reports the average person will "change jobs ten to fifteen times" during their working life. This means (and is verified by the Bureau) that the average person works the same career for less than five years. Other surveys indicate there is a generational split between flexible benefits or increasing wages.
The question is difficult to provide one definitive answer because, depending on the field of a person's career, flexible benefits may not be an option. Or because the wage is relatively low compared with living costs, the immediate need for higher pay negates the appeal of flexible benefit plans. For example, if you are a school teacher, your salary and benefits are set by the state and district you choose to teach. Some progressive school systems are offering perks like housing subsidies and bonuses to attract teachers to areas where traditionally there is a teacher shortage. A recent college graduated teacher has to decide how the cost of living compares with the fixed salary schedule.
In the instance of a career where the wage is set (government employment or minimum wage jobs, for example), unless the starting salary is significantly above the cost of living, an employee will most certainly choose the higher wage. The decision is probably out of necessity even though they may prefer a flex plan.
The inverse is true if you are in a high demand field such as information systems or engineering—then you are more likely to find flexible benefit packages more appealing than higher wages. Starting salaries are relatively high as compared with other career choices because of the limited supply of labor. Attracting new hires and retention becomes critical. Offering competitive salaries only goes so far.
Allowing an employee to customize their personal needs through some type of flexible benefit plan is very attractive to prospective workers. For example, if I am a single employee with few financial obligations, I may prefer exchanging short term wage increases for options to invest in additional education, retention bonuses, or other perks. If I am married with four children, the immediate need for a higher wage at least short-term to pay for my children's education, daycare, or larger home may outweigh the appeal of flexible benefits. But even in the example of an employee with a family, there are many options available under flex plans.
The answer is that, generally, most people have short term needs that may influence them to opt for wages over the appeal of flexible benefits. Depending on your choice of career, flexible benefits may be crucial to the decision of where a person chooses to work. In this instance, the appeal of flex benefits makes it a better option than wage increases.