… That Small Business Owners Should Know
The employee benefits landscape has changed over the past few years, driven by several factors. Between changes in the workforce’s needs, the COVID-19 pandemic, a greater focus on mental health, and a rise in healthcare costs, we’ve seen a couple of shifts in employee benefits trends.
The competition in today’s market for talent leaves many small business owners wondering how their employee benefits compare. While administering benefits for hundreds of small businesses, we’ve noticed some recent trends.
A shift to personalized employee benefits and more choices
More companies find that their respective workforce may have different wants and needs regarding benefits. A single-benefits approach may not work. Companies survey their workforce to determine what employee benefits are most valuable to them and spend their dollars accordingly. They also vary the plans offered by their carriers. In addition to traditional HMO and PPO plans, they include options like high-deductible plans for healthy individuals and families to save on premiums. Or, offer Health Savings Accounts (HSAs) or Flexible Spending Accounts (FSAs) so that employees can take advantage of pre-tax savings.
Many are moving beyond the traditional medical and dental plans to add offerings like pet insurance, mental health assistance, and robust paid time off policies.
Generous leave policies
According to a Deloitte study, an increasing percentage of the workforce consists of Millennials and Gen Zers, many of whom cherish work-life balance. In fact, they tend to value it ahead of career progression and meaningful work. As a result, more employers are offering generous leave benefits, including:
- Holiday trading, where employees can trade extra cash for holidays and vice versa
- Wellbeing or mental health days, where employees take time off to relax or do something to refresh and improve their physical and mental health
- Unlimited paid time off policies, which according to a study by Zippia, increased by 178% between 2015 and 2019
- Flexible work schedules
Increased caregiving employee benefits
We have a workforce full of the sandwich generation taking care of children and elderly parents. The demand for options rose rapidly during the pandemic, especially among working parents who had to juggle work and children who were remote learning. In response, companies are offering a wide range of child and adult care benefits. These include child or elder care stipends, extra paid or unpaid caregiving leave, and resources like an employee assistance program (EAP) to assist in finding caregiver referrals and offer family counseling.
Remote or hybrid work opportunities
If the pandemic taught us nothing else, it was how we could work remotely. Many businesses quickly realized that they could offer remote work and that employees thrived in that environment. In fact, some studies have shown remote work improved job performance, employee retention and widened the business’ talent pool. Likewise, employees value the ability to be able to work from home. It helps with work-life balance and gives those caring for others more flexibility. And it reduces commuting time and costs.
Joining larger groups for better benefit buying power
Many smaller companies take advantage of group benefits buying power by joining a professional employer organization or PEO. By partnering with a PEO, they find medical, dental, vision, disability, life, pet, identity theft, and many other insurances much more affordable. This affords them to option of offering a more robust employee benefits package to attract and retain better talent.
Mental health benefits
The emotional and psychological challenges experienced by national and global events have mental health in the limelight. There are many reasons an employer should invest in an employee’s mental health. Some are doing so with employee benefits like wellness coaching sessions, gym memberships, or yoga workshops in the office. Others advocate more consistently for employees to utilize existing employee benefits such as the Employee Assistance Program (EAP). While EAPs have been around for years and are incredibly affordable, they tend to be one of the most under-utilized benefits in the workplace.
Financial wellness benefits
Financial problems are a significant source of stress and anxiety, both of which we know impact productivity. In fact, 39% of employees who participated in a TeamStage survey say that money concerns have affected their personal and professional lives. In response, businesses explore financial wellness programs that address their employees’ short-term money worries. One such benefit is advance pay or access to earned wages before payday. Companies have also offered financial wellness workshops, emergency loans or advances, or student loan assistance. Additionally, most EAP programs boast a financial wellness component and resources too.
What innovative benefits has your organization added to your benefits packages lately to attract and retain key talent? We’d love to hear from you!