It is commonly known that employees who feel their healthcare and financial security issues are being addressed by their employers’ benefit offerings are more engaged, productive, loyal and in the best position to help grow your business.
Recent studies show employee concerns over financial security are impacting company performance more than ever. For years, employers have improved their employees’ productivity and retention by enhancing benefit offerings for employees, which in turn improve the employee’s financial fitness. In addition to their pay, how are employers helping personnel stay financially fit?
Retirement funding is the obvious choice for future financial security and fitness, but today more employees are counting on other employer-paid and voluntary benefits to help make ends meet. According to a 2014 MetLife study:
As the cost of healthcare increases, so will the link between financial security and your health plan. Top talent will race to employers who help them the most with healthcare.
While employers don’t perceive a strong connection between their health plan and an employee’s finances, a MetLife survey shows 64% of employees say health coverage is “important for achieving financial security.” When making employment decisions, employees will consider the cost and quality of the employer's health plan.
According to the United States Department of Labor, the average voluntary turnover rate is 21%. A study published this year in Harvard Business Review indicates that businesses offering long-term financial security to employees have less than half of the industry averages in turnover. Lower turnover translates into cost savings for employers.
More specifically, employer savings are realized with lower hard and soft costs related to turnover. The hard costs include administrative expenses, recruitment, hiring and training of new employees. The soft costs are more difficult to quantify as they include lost expertise and knowledge, decreased productivity, disruptions in workflow and missed deadlines.
Organizations are looking for new ways to foster loyalty among employees. Employers who add value to existing benefits programs and provide new offerings will maintain or establish the organization’s position as an employer of choice.
There is a correlation between employee satisfaction, financial security and benefits. Of the employees in the MetLife study who say their workplace is great, 69% say the benefits meet their needs.
Most employee benefit programs are equal to 30% or more of an employer’s total compensation package. Consider how important it is to ensure your compensation and benefit offerings are not only competitive, but are communicated properly to attract and retain top talent.
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Employee retention continues to be a top concern for employers, even more so than last year, according to a PayScale survey of more than 4,000 executives and human resources professionals.
In 2014, a staggering 59% of employers were more concerned about retaining talent than anything else. Five years ago, only half of those employers thought retention was their number one concern.
Offering voluntary benefits to employees is a great way to provide a wider set of options for employees and position yourself as an employer of choice. However, just offering voluntary benefits may not be enough. Employers should offer voluntary benefits that work together to not only manage costs but also to increase overall program value.
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