Last year, U.S. businesses added an unprecedented 3.8 million jobs. But however positive that may sound, workforce participation remains low with 2.8 million fewer Americans working today compared with February of 2020, according to the U.S. Chamber of Commerce.
For small to medium-sized businesses (SMBs), the ongoing labor shortage has been especially challenging as companies struggle to attract and retain qualified workers. Today, most experts agree that the ability to offer meaningful benefits is one of the surest ways to improve employee satisfaction and increase retention. But with so many types of benefits available, and with most SMBs operating with a limited budget, how do employers know what benefits to offer workers?
As an insurance professional, you can help your business owner clients better understand what benefits trends can better serve their company and how to take advantage of the various options available. According to the website People Keep, the best employee benefits for attracting employees and increasing worker satisfaction fall into six main categories: wellness perks, group health insurance, health reimbursement arrangements, remote/hybrid work, and retirement and educational benefits.
Wellness perks. These types of benefits allow an employer to be creative in choosing the wellness initiatives they think their employees would like. Some examples can include gym memberships, healthy meal kit subscriptions, or even a reimbursement program for health and wellness services such as eye exams, glasses and annual checkups.
Group health insurance. A group health plan is one of the most sought-after benefits for employees. And while a group health insurance plan can be a big expense for a small operation, the business can deduct the cost of insurance to help reduce its taxable income.
Health reimbursement arrangements (HRAs). HRAs may not be a new trend, but they are fast becoming a very popular choice in helping today’s SMBs create a self-insurance plan for their employees. Acting as an employer-funded group health plan, an HRA reimburses employees for medical expenses up to a certain dollar amount. Employers fund and own the accounts, giving them the ability to keep all savings and any unused funds. HRAs can help employers customize a benefit plan that fits their needs and budgets.
Remote/hybrid work. Giving employees the ability to work remotely (full or part-time) has become an important trend in benefits that isn’t going away anytime soon. In fact, workers are going out of their way to find employers that offer more workplace flexibility. The benefits are clear: no transit fees or gas costs, no traffic, the ability to work comfortably from home, etc. By eliminating these and other factors, employees have been shown to be more productive, happy and dedicated to their job and employer. Today, 66% of employees surveyed said they want a more flexible work schedule, with just 47% of employers providing them.
Retirement benefits. Improving retirement benefits is another trend that has been shown to attract and retain qualified workers. For example, some businesses are electing to increase their 401(k) match percentages, while others are adding profit-sharing options so employees can share in the company’s success. According to People Keep, employees who work for a company that doesn’t offer a 401(k)-match retirement plan are less likely to stay with that company until retirement.
Educational benefits. Reimbursement programs and paid job training have been shown to produce the highest degree of employee satisfaction. In fact, 40% of workers surveyed said paid job training is very important to them. Tuition assistance also helps a business reduce employee turnover. It is such a valuable benefit, employees will stick around longer, saving a business the cost of having to hire and train new workers. Plus, all that education means that when the business needs it, it will have a pool of qualified employees from which they can hire from within.
As an insurance agent, your business clients may look to you to determine what they can do to get and keep the hardworking employees they need. You can help them by staying informed on current benefits trends that reflect what workers today are looking for in an employer.
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