4 low-cost benefits that help attract and retain employees
Key fact: Since the pandemic, 98% of employers plan to invest more heavily in benefits employees want1.
The US economy has yet to achieve full employment after the disruptions of COVID-19 – but in many sectors, employers say the competition for talented employees has never been greater. The good news for brokers: companies also have an increased appreciation of how benefits can help recruit employees and retain them. But while almost all employers in the Care.com Future of Benefits survey said they planned to increase their overall investment in employee benefits, the same study found that 89% are planning to deprioritize at least one type of benefit, for example, onsite childcare.
The net takeaway: employers are becoming much smarter about their benefits package. They can't afford to pay for everything under the sun, but they want to have a conversation about the cost-benefit tradeoffs for each part of their benefits program. Companies already understand the attraction – and cost – of providing competitive retirement and health care benefits. But they also know that the workplace environment and employee expectations have changed dramatically in the wake of the pandemic. Brokers that can bring them affordable or complimentary solutions with real employee appeal will gain revenue and influence in the current environment. Here are four opportunities to focus on:
1. Flexible work solutions
A recent PwC study shows that companies and workers still don't see eye-to-eye on the optimal balance between remote and onsite work - employees want it for work-life balance more than employers do. Nevertheless, the shift to a hybrid home/office work setting is well underway: just 1 in 6 companies (17%) is now pushing to bring all work onsite and in-person as soon as possible. But beyond the hybrid workplace, SHRM also notes a growing demand for more flexible hours and quotes recent research stating the 81 percent of employees said they would be more loyal to their employers if they had flexible work options.
Flexible work hours and workplaces don't necessarily add to costs and can often lower real estate and other expenses. However, this flexibility does introduce a host of administrative and logistical challenges for employers. As companies deemphasize onsite child care, many are looking to create more hybrid-friendly child care benefits, for example, with access to online platforms for finding and managing care. Keeping track of hybrid employees is also a challenge. While there are a number of online work scheduling solutions available, employers need help finding and implementing the best choice for their needs. And the broader issue of employee absence management becomes even more of a headache. These work flexibility issues create opportunities for brokers to help bring in the right third-party solution to their problems. For example, third party solutions can help minimize the productivity issues of absence while ensuring consistency and objectivity in the treatment of employees, which is key to compliance with labor laws such as FMLA and the ADA.
2. Virtual health services
Telehealth usage surged dramatically during the pandemic: 529,000 claims were filed nationwide in February 2020, but the rest of the year averaged more than 8,000,000 telehealth claims per month - a 16x increase. While some drop-off is expected, experts don't foresee telehealth going away because it works well for employers and employees alike: workers with mild or familiar symptoms can be seen quickly without traveling to and from the doctor or dentist's office. In turn, that helps reduce lost productivity for employers.
Telehealth services don't add directly to an employer's expense because they are typically embedded in the overall cost of a company's medical and dental plans. However, as employers evaluate yearly plan changes, telehealth benefits may become more of a priority, so brokers should be prepared to speak knowledgeably about the pros and cons of offerings from competing providers. For example, while several dental plan providers, including Guardian, offer teledentistry coverage, expect clients to require more information about the level of telemedicine support among competing options.
3. Group life insurance
Many employees are still reluctant to purchase life insurance as individuals. However, a 2017 LIMRA study found that 58% of workers strongly feel that life insurance benefits were important in the workplace. And in the wake of the pandemic, LIMRA's 2021 Insurance Barometer Study has since found an increased interest in life insurance, which is consistent with the aftermath of past mass mortality events, such as 9/11.
Employer-based coverage has declined somewhat in recent years, so companies that offer it have an opportunity to set themselves apart. Remember, employers are willing to invest in benefits that employees really want, and group life insurance could be what tips the scales in your client's favor for a new job applicant. Moreover, while there is a cost, it may be surprisingly low for many employers: Glassdoor reports that it costs only $36 per month to cover a 40-year old employee in good health.
4. Voluntary supplemental health benefits
Even though employers express increased willingness to invest in benefits, health care costs continue to be a concern. While they are looking for ways to contain costs, there's a limit to how much of the cost burden can be shifted to employees: Nearly 3 in 5 working Americans would have to borrow money to pay for a $3,000 medical bill.2 That's why voluntary supplemental benefits – Accident Insurance, Critical Illness Insurance, Cancer Insurance, and Hospital Indemnity Insurance continue to grow in popularity. While brokers certainly don't need to be reminded of the value proposition for each of these benefits, it's an excellent time to remind clients why they should be offered to workers.
52% of workers plan to become job seekers in 2021. And every time an employee leaves, it costs your clients real money: Gallup estimates that US businesses incur one trillion dollars in losses each year due to employee turnover. Of course, the labor market could change drastically next year, but right now, employers are looking at benefit offerings to help limit their turnover costs. So take full advantage of the opportunity while it lasts.
