Imagine that you’ve been tasked with creating an employee benefits package, but with one catch: You have to do it without any data or insights into employee behavior or state of mind.
You would need to make assumptions about employees that may not be accurate, or you may make choices that don’t reflect the entire workforce. It goes without saying that it would be extremely challenging to do.
Unfortunately, organizations often lack this foundational data when it comes time to design an employee benefits package. Employers of all kinds feel they are struggling to create just the right benefits approach for the multi-generational workforce. In a labor market characterized by low unemployment, however, benefits are more important than ever to attract and retain a diverse set of employees.
With this reality in mind, Businessolver® released the MyChoiceSM Recommendation Engine Benefits Insights Report, which outlines benefits insights from user-generated data during 2019 benefits annual enrollment. The data was drawn from specially designed questions that employees answered to get a personalized benefits recommendation. The insights from this report equip employers with actionable data to improve benefits engagement, communications, education and overall employee well-being.
Here are the top three findings from this report that can help any HR professional develop a benefits strategy that is updated, efficient, and most of all, empathetic:
- Benefits literacy is in crisis. Benefits have become increasingly complicated. Those in the HR profession may joke about the barrage of new benefit plan acronyms, but the data shows it’s representative of a true challenge. According to the Benefits Insights Report, over 80% of employees are not knowledgeable about their benefits packages. When employees aren’t equipped to select the coverage that best suits their life situations, they’re likely to suffer from mismatched plans, and employers face a return-on-investment shortfall.
It’s more important than ever for employers to focus on basic benefits knowledge with ongoing, personalized communications and engagement. HR departments should consider leveraging a range of digital tools like text messaging and online employee resources to ensure employees have the knowledge and the tools they need to select the most appropriate and useful benefits. When Annual Enrollment is over, it’s crucial to keep those communication touchpoints going so that employees gain a deeper understanding of the benefits they use throughout the year.
- Decision-making is impacted by risk aversion. Half of respondents in the Benefits Insights Report responded that they’d be “panicked” about a large, unexpected ER bill. The financial precarity facing a significant portion of employees leads to benefits election decisions informed by short-term financial fears more than long-term foundational planning.
Providing employees with easy-to-use decision guidance helps them overcome both risk aversion and a lack of benefits expertise. Helping employees approach benefits decision-making from an informed, empowered place leads to better outcomes for both employees and their employers. And it’s a great way to demonstrate empathy with employees when they’re navigating what can be an intimidating annual enrollment process.
- Financial stress is contributing to employee stress. It’s indisputable that a rapidly changing world is creating more and more stressors on peoples’ daily financial lives. Simply making ends meet is a challenge for many, even without the added pressures of contributing to savings, investing in retirement and managing student loan debt.
Employers are beginning to connect the dots between financial stress and lower employee engagement and productivity. As a result, there’s an emerging emphasis on total financial well-being. This includes the traditional focus on retirement saving, but also more near-term challenges such as creating a rainy-day fund. Helping employees see the value of their total compensation with a total rewards approach can help employees get a better handle on their financial situation and position them to meet short- and long-term goals.
Benefits programs are intended to address employees’ needs and challenges, providing a meaningful safety net as part of their compensation and relationship with the employer. Without a good understanding of where employees are coming from, employers risk designing and fielding benefits that miss the mark, which translates into lost opportunity from a recruitment and retention perspective, and money not well spent. Insights from the MyChoice Recommendation Engine Benefits Insights Report offer employers a glimpse into their employees’ state of mind to help inform benefits design and delivery.