It’s been a long time since the American economy was this hot and the unemployment rate so low (at the time of this writing, the rate has dipped below 4 percent — the first time in 50 years). A strong economy is good for business, but it forces organizations to focus more on staying competitive and keeping workers from jumping ship. Part of that effort involves ensuring that they have attractive and relevant employee benefits.
In this economic environment, standard health and retirement benefits are table stakes. To stand out, employers need to offer career advancement and perks that help limit out-of-pocket costs while promoting a healthier, less-stressful lifestyle.
According to the Society for Human Resources Management’s 2017 Employee Benefits Report, one-third of businesses boosted their benefits in the 12 months before the survey took place early last year. For example, more organizations are helping employees keep up with rising healthcare costs and providing additional offerings, such as wellness programs that enhance both personal health and financial well-being.
Some organizations are helping employees pay off student loans, while others have instituted four-day workweeks of 32 hours or less. More commonly, organizations offer standing desks, flextime and health savings accounts to keep their staff productive and happy.
“It’s becoming much more competitive,” Alex Quevedo, senior vice president and general manager, ADP Insurance Services, said of today’s labor market. Organizations should beware. The employees they’re trying to attract may be looking for personalized benefits offerings, he said. And the employees they’re trying to keep are at risk of being enticed by other employers offering additional or better benefits.
Here are a few benefits organizations should consider offering to attract and retain top talent today — and for the workplace of tomorrow.
Health and wellness: More partner coverage and standing desks
It used to be that one hallmark of a tech startup culture was the endless bins of snacks and cereal. These days, across companies of all sizes, it’s standing desks, which reflects a recent focus on health and wellness.
That’s not to say that traditional health benefits have suffered, but they’re getting more expensive. Two-thirds (66 percent) of employers said they were “very concerned” about controlling healthcare costs, according to the Society for Human Resources Management (SRHM) report. Among organizations surveyed, 79 percent saw an increase in healthcare costs, with an average increase of 11 percent. By promoting health and wellness, organizations are trying to better manage their costs.
The survey shows that 24 percent of organizations have increased these benefits over the previous 12 months. One example is those standing desks: Just 13 percent of employers offered such desks in 2013, but by last year the figure had risen to 44 percent.
One popular method of controlling healthcare costs is health savings accounts. These plans allow for tax-free savings that can be used to pay certain out-of-pocket costs that health plans don’t cover. The study shows 55 percent of employers offered this type of plan last year, versus 42 percent in 2013. “HSAs are prevalent because they cut expenses that are passed on to employees as healthcare costs continue to rise,” Quevedo said.
More organizations are also extending healthcare coverage to opposite- and same-sex spouses, the report shows: 95 percent of those surveyed in 2017 versus 71 percent in 2014. Coverage for same-sex spouses increased to 85 percent in 2017, up from 46 percent in 2014.
Retirement savings: 401(k)s and loan relief
It’s rare to find a company that doesn’t purport to be concerned about its employees’ well-being. A 2017 Aon Hewitt survey found that 59 percent of employers said they were very likely to focus on the financial well-being of their workers in ways that extend to retirement. Another 33 percent said they were moderately likely to do so. That concern usually translates into retirement savings plans. The survey shows that 90 percent of organizations surveyed offer some type of 401(k) or similar defined contribution savings plan.
“While retirement savings plans are almost table stakes for an employer,” said Kristin Andreski, senior vice president and general manager of ADP Retirement Services LLC, “research by PwC states that the majority of employees surveyed are currently saving for retirement, but 40 percent of those employees have saved less than $50,000 for their retirement. Employers shouldn’t lose sight that today’s workers are struggling to manage their financial lives.”
More organizations are offering student loan assistance, but they’re still considered outliers. According to the SHRM research, just 4 percent of organizations offered this benefit in 2017. That’s even though 88 percent of Millennials consider student loan repayment assistance an important benefit for employees.
Work/life balance: four-day workweeks
More workers today are looking for greater control of their time. Research shows that work/life balance is often a bigger concern for employees than what they get paid. Employers are taking notice: The SHRM benefits study shows 62 percent of organizations allow telecommuting and 57 percent offer flextime, which lets employees choose their work hours. The freedom extends to what employees wear to work. According to the report, 85 percent of organizations now allow their employees to dress casually any day of the week.
Another way organizations are trying to address employees’ perceived time deficit is by offering free on-site parking (85 percent), subsidized or free cafeteria food (13 percent) and free coffee (80 percent). Searching for a parking spot or going out for lunch or a beverage, after all, can be time-consuming.
A Major Challenge For Employers: Communicating Benefits
Benefits, given their relevance to the workforce, can help boost employee retention — but only if the staff knows about them. Even when organizations offer competitive benefits, employees often aren’t aware they exist, according to Andreski.
In 2018, employees are used to consumer-facing interfaces for their apps and programs, and they expect information to be easy to find. This is a challenge to HR departments, which often have a hard time communicating the benefits they offer to the rank-and-file. In a recent survey, some 60 percent of employees say they prefer that benefits be communicated electronically. Unfortunately, the average employee receives 121 emails a day, so that’s not always the best channel for communications.
Employers have to market their benefits, just as they do their products and services. Andreski said the communication channels for doing so should be those that employees regularly use, such as texting. “You need to serve up the right message at the right time so that employees know what they have and can easily transact or opt in to programs,” Andreski said.
While making employees aware of various benefits programs can be an additional hurdle for organizations, it’s that extra effort that helps them stand out. “I think the best-in-class employers are not only leveraging technology and have robust benefits offerings, but are also making it easy for their employees to identify those potential options,” Quevedo said.
Todd Wasserman was both the last editor-in-chief of Brandweek and the first business editor for Mashable. He writes mostly about technology.