So, your job search has paid off and now you have two offers from two local hospitals in hand. You like the people at both of them, and they both seem to offer a good working environment where you’ll be able to further your skills in respiratory care. The shift is the same at each, and you’ll be working about the same number of hours as well.
Clearly, it’s going to come down to salary and benefits. Most people would look at the hourly rate and pick the highest of the two. But unless you’ve carefully considered the benefits package, you may be doing yourself a disservice with that strategy. These two scenarios involving the top two benefits at any employer – the health and retirement plans – show how tricky it can be to sort out the differences:
Health benefits: Let’s say Job 1 pays $30 per hour plus health benefits. Job 2 pays $31 per hour plus health benefits. Clearly, Job 2 is the winner, right? Not necessarily. If Job 1 covers 100% of your monthly health insurance premium and has only a $500 annual deductible, while Job 2 only covers 80% and has a $1,000 annual deductible, you could really come out ahead by taking Job 1. That’s because with Job 2, you have to deduct the cost of the monthly premium from your total compensation and your out-of-pocket health expenses will be higher.
Retirement Plans: Job 1 again pays $30 per hour and the hospital gives you the opportunity to contribute up to $2,500 per year to a 401K plan, which will be matched dollar for dollar by the hospital. Job 2 pays $31 per hour but only offers a 50% match for a 403b plan allowing a maximum contribution of $1,000 per year. So with Job 1, you have the potential to gain an extra $2,500 per year, while at Job 2 the most you could gain is $500. In this case, Job 2 still comes out slightly ahead ($80 more annually based on a 40 hour work week), despite the less favorable retirement plan. But Job 1 provides you with a better opportunity to build for retirement.
Other benefits offered by the employer can come into play too. You’ll want to take a close look at dental insurance, vision/eye care insurance, life insurance, vacation days, holidays, on-site child care, tuition reimbursement, the opportunity for overtime, and other perks.
All of these factors should figure into your decision when comparing the total compensation package of one job offer to another. Clearly, the hourly rate only tells part of the story.