Posted by Employer-funded benefits are still important to employees in today’s tight job market. But healthcare prices are rising because of inflation, economic instability, and more people using healthcare because of the pandemic.
Employers must balance what they can afford and what they need to do to offer competitive benefits. They should also invest their benefits budgets carefully.
So, how can employers keep costs down? While still giving their workers a good benefits package that makes them happy, healthy, and more financially secure?
Here are 4 steps that employers can take to offer attractive benefits to employees:
Step 1: Use voluntary perks to do more (for less)
Employers may feel the need to reduce employee perks when the economy isn’t stable. But in reality, a lot of organizations are doing the reverse.
A study found that 60 percent of companies are considering a new insurance benefit in the next two years. This is about twice as much interest as five years ago. Some of the top benefits they want to add are short-term and long-term disability insurance, eye care benefits, dental insurance, and life insurance.
Because most or all of the cost of these top voluntary benefits is paid by the employee, employers can pass some or all of the cost on to their workers. This can help companies find and keep good employees while keeping costs and coverage in check.
Employers can use tax deductions for benefits to help ease the financial load even more. Some optional perks can also be taken out of an employee’s paycheck before taxes are taken out. This can help the employee’s taxable income and the employer’s payroll taxes. This can benefit both the company and the people working there.
Voluntary benefits can benefit small businesses because they let them give more attractive packages and compete with larger companies with bigger budgets for salaries.
For workers, voluntary benefits can help protect their income in a volatile economy and fill in gaps their health insurance plan doesn’t cover. Most of the time, the cost of voluntary benefits an employer gives is less than what an employee would pay on their own for similar coverage.
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Step 2: Give workers what they ask for
Research shows that workers now care more about their benefits than they used to, but the types of benefits are important. Companies must consider what’s important to their employees when making a benefits plan.
For example, workers today want benefits that protect their income. A recent poll found that people are almost twice as interested in disability insurance and three times as interested in life insurance as in 2022. On the other hand, people are less interested in pet insurance and legal protection.
So, employers should offer basic voluntary benefits like disability and life insurance. These can help protect workers’ incomes and give their families financial security during loss or trouble.
Add-ons that are not required can make these perks even better. In the event of a long-term disability, choices like student loan repayment and activities of daily living provide an extra layer of financial security. Employers should also look for value-added benefits like travel aid, help to find a companion for the beneficiary, and help with identity theft that may be part of some life and/or disability plans. These important benefits can help workers and their families make ends meet when times are tough.
Step 3: Handle health risks for the long term
In an uncertain economy, business leaders are likely to put a high priority on cutting costs. This could mean that some companies cut back on perks and extra rewards for their employees. But employers may be able to save money on future healthcare costs if they offer perks that help keep their workers healthy.
Preventive eye and dental checks, for example, can help find early signs of heart disease and diabetes, which can lead to expensive medical claims. Giving people access to preventive care, dental and eye care can help them find health problems early, before they get worse and cost more.
Another major worry is mental health. A recent Gallup poll found that people who said their mental health was “fair” or “poor” lost about four times as much work. Over a year, this lost work cost about $47.6 billion in lost income.
In response, many employers are giving their employees more help with their mental health through benefits and other practices that put the health of their employees first.
Step 4: Prioritize communication
Communication is the key part of the employee experience. It helps build an engaging and efficient team. Research has shown that companies with better employee experience do better.
Employees can get the most out of an employee benefits program if they understand and fully value the offer. Employers should have an ongoing, multi-channel communication plan. Which can help to tell employees how optional perks can meet their needs at every stage of their lives.
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Anisa is a writer who focuses on career and lifestyle topics in an effort to motivate both job searchers and employers towards greater fulfillment in their professional lives.
Reach me at anisa@jobstore.com.