It’s 2017. Is Your Benefits Package Still Competitive?
Looking to recruit and retain top talent? You’re gonna need a bigger benefits package – and health insurance and a competitive retirement plan need to be at the top of that list. That’s the word from the Employee Benefit Research Institute (EBRI). The 2017 EBRI/Greenwald & Associates Health and Voluntary Workplace Benefits Survey reported the following:
- Companies that offer health and retirement benefits along with other ancillary benefits, in addition to a competitive salary, are running rings around stingier competitors in the talent market.
- Almost 9 in 10 workers surveyed reported that employer-paid health insurance is a ‘very important’ or ‘extremely important’ consideration when they choose where they plan to work. Major medical insurance is the single most important employee benefit employers can offer. This was true for a wide cross section of employees, including Millennials and Baby Boomers.
- 77 percent of employees told surveyors that a retirement savings plan is “extremely important” or “very important” when it comes to deciding whom they want to work for.
- 72 percent ranked dental and vision coverage as either “extremely important” or “very important.”
The survey results indicate that remaining competitive on the benefits front is critical for employers who want to retain quality talent. If you aren’t offering a robust employee health plan with vision and dental, and a competitive retirement savings plan with matching contributions, you are essentially competing for the bottom 28 percent of the work force. As long as you aren’t competitive, they’ll be taking offers, if not actively searching for better compensation.
Researchers also found that 20 percent of current full-time workers were not satisfied with benefits currently offered by employers. Another 32 percent reported being only ‘somewhat satisfied’ with employee benefits. This makes the majority of employees — 52 percent — ripe for poaching by recruiters targeting passive job candidates. As long as your employee has a private email account and/or a LinkedIn profile, they are wide open to approaches by competitors seeking talent in an increasingly competitive market for labor.
Don’t stop at medical and retirement
As the economy recovers and the employment situation improves, it is becoming increasingly clear that a basic retirement plan and health care plan are no longer enough to satisfy the best talent available. A majority of survey participants reported that employer-paid life insurance and disability insurance were also important factors in their career decisions.
Educational benefits, including student loan repayment assistance, is also becoming an increasingly vital consideration, especially for younger workers. According to American Student Assistance, fully 86 percent of Millennial workers surveyed report they would be willing to commit to an employer for at least five years in exchange for help repaying oppressive student loans. 93 percent of young workers would take advantage of a sign-on bonus targeted at paying back student loans, and 92 percent would take advantage of a match for student loan repayments similar to a 401k match.
“Employers who offer a strong employee benefits package that balances cost and choice should find themselves with a competitive advantage over other companies when it comes to attracting and retaining desirable workers, and will have more satisfied employees overall,” the study’s authors wrote.
Provide coaching and education
The vast majority of those surveyed – two thirds – reported they wanted advice from employers or coaching from third-party providers, either in person or online – on how to invest their retirement funds, choose a health care plan, and make other major financial decisions.
Demand is increasing over time.
The EBRI study reflected an increase in demand for quality benefits compared to previous years. For example, the percentage of survey participants who consider their workplace retirement plan to be an ‘extremely important’ consideration has increased from 40 to 45 percent since the last survey, and the percentage of respondents reporting the same about employee-paid life insurance has increased from 17 percent to 26 percent. The percentage of workers reporting they place extreme importance on disability coverage is up by a third, from 15 to 21 percent.