Many employers already deploy surveys to monitor employee engagement with the organization, but there remains an important opportunity for advisers to help clients understand the role benefits play in that engagement.
To seize that opportunity, advisers can learn from vendors that are leading the research. One such effort, for example, is the Guardian Workplace Benefits Study, launched last month by Guardian Life Insurance Company of America.
The study, designed to measure the perceived value of employee benefits among working Americans, contains views from 1,667 benefit plan participants as well as 1,071 employers captured in separate online surveys. The resulting Benefits Value Index and reveals that workers, on average, have a score of 6.8 (based on a scale of 1 to 10), suggesting that while employees do value their benefits, there is significant room for improvement.
The Index reflects the level of belief employees have that their benefits are meeting their needs, are reasonably priced, contribute to their health and their financial security, as well as how successfully their employers are communicating their benefits offerings.
The Benefits Study “provides a deeper understanding of the relationship between workers, benefits and engagement and will serve as an annual benchmark for measuring workers’ value of insurance benefits at the workplace,” says Elena Wu, vice president, group marketing and learning services at Guardian. “By offering a study that uncovers workers’ attitudes towards benefits and their specific needs, we are able to provide valuable insights that may help employers foster greater loyalty and engagement and improve their employees’ confidence in their benefits decisions.”
Factors influencing perceived value
The study reviewed how factors such as socioeconomic status, life events and life stage can impact how workers feel about their benefits. For example, workers who are more educated, older and are in a later life stage tend to score much higher on the Benefits Value Index than their counterparts. The study also finds that workers who experienced fewer “life events” in the past two years (e.g. having children, getting married, buying a house), tend to score higher on the Index. Also, a larger proportion of women fall within the high index range of valuing their benefits than men.
Size, industry and location of the employer also impact how much workers value their benefits and account for fluctuations in scores. Workers at larger companies (median of 500 employees) tend to have more robust benefit offerings, benefits-support and employer contributions, and therefore score significantly higher. These workers usually have greater access to effective benefits-related communication, education and a diverse set of products. Industries with employees that score highly on the Benefits Value Index include public administration and education, as well as health care and finance/insurance. Conversely, automotive, transportation/warehousing and accommodations/food services are industries where the perceived value of benefits among workers is likely to be lower.
“The research findings reflect the widespread reality within the industry that there is a considerable need for both employers and carriers to help employees make the most out of their benefits,” says Wu. “While employers are juggling both the need to manage benefits-related costs and meeting the needs of their workers, it is necessary for them to increase the effectiveness of their benefits programs in order to help their employees be better protected and feel more confident about their benefits, which can contribute to greater satisfaction and long-term engagement with their employer.”
Benefits affect employee appreciation, loyalty and engagement
A variety of factors impact employee engagement, and although strong leadership, compensation and connectedness with coworkers can all impact engagement in the workforce, employee benefits play a critical role in employee loyalty and retention.
The majority of employers offer benefits to attract and retain talent and, overall, two-thirds of workers feel that employee benefits are very important when deciding to stay with an employer. An even greater number (72%) feels that benefits are very important when deciding whether or not to take a new job. Workers who score high on the Benefits Value Index feel that employee benefits are very important in their job decisions. Conversely, those who score lower are least likely to feel that their benefits package is an important factor.
Personalized, benefits-related content can improve worker attitudes toward the value of their overall benefits package, which contributes to engagement. More than 9 in 10 workers are interested in receiving personalized recommendations about benefits and coverage levels from insurance carriers for specific benefits and coverage levels, and not coincidentally, these workers score very highly on the Benefits Value Index. Content that is targeted to a worker’s background, life stage or even household can allow workers to make more informed decisions about their benefits and ultimately lead to greater confidence that they have made the right decisions.
Delivering benefits communications and enrollment services in the channels most preferred by workers also contributes to higher perceived value and engagement. While online programs remain the preferred enrollment channel, employees have a clearer sense of benefits satisfaction when they are provided the option of selecting their own channel of enrollment (Score of 7.4). This helps employees project more confidence in the benefits that they select, thus contributing to greater loyalty and engagement and a higher score. Equally, this segment of employees also tends to have a longer tenure with their employer, places greater value on their benefits and is predicted to have an increased likelihood working at this company one year from now.
Overall, employee benefits are an important retention tool for employers. As workers start to value the benefits their employers offer, they are likely to feel that the benefits are useful and that their employers consider employee benefits a priority in their overall goals of attracting and retaining top talent (Score of 7.8). Understanding the value is a key to employee engagement, and, in turn, leads to workers that are engaged, as well as healthier, happier and more productive.
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