Benefits, Compensation, Hiring & Recruiting, Strategic HR

New Benchmarking Analysis Identifies Recent Trends in Balancing Benefit Costs and Attracting Top Talent

When employers have a sense of how their peers’ benefits and compensation approaches measure up to their own, they can more confidently identify opportunities for improvement. The Best-in-Class Benchmarking Analysis produced by Arthur J. Gallagher & Co. (Gallagher) examines the strategies and tactics used by high-performing organizations to control healthcare cost spending while competing for top talent.


“Employers need to focus on the best practices that offer the greatest potential to define them as destination employers,” said William Ziebell, President of the Benefits and Human Resources Consulting division of Arthur J. Gallagher & Co., in a press release. “Ways to effectively contain healthcare costs and drive employee engagement change over time. It’s important to keep current on the characteristics that distinguish the best in class within a peer group. This analysis provides strategic insights that can help employers optimize their benefits and compensation approaches to gain a competitive advantage.”

Controlling Healthcare Costs Starts with One Notable Shared Attribute

Compared to their peers, both midsize (100 to 999 full-time employees) and large (1,000+ full-time employees) best-in-class employers more actively manage their healthcare costs. One notable shared attribute was the ability to avoid increasing employee contributions to health plan premiums in 2016.

In the midsize group, only 45% of the best in class increased employee contributions (vs. 63% of peers). This was slightly more prevalent in the large group at 50% (vs. 73%of peers).

Aligning Business and People Management Strategies to Focus on Performance

The best in class tend to take a more strategic approach to managing HR that emphasizes business and employee performance. They are more apt to base benefits planning on strategic organizational plans— as seen in 51% of midsize employers (vs. 36% of peers) and 63% of large employers (vs. 47% of peers).

The best in class also show a strong commitment to supporting employee success. Seventy-six percent of midsize employers give timely and constructive feedback to their employees (vs. 64% of peers), and 78% of large employers set clear performance goals for their employees (vs. 61% of peers).

Gallagher developed the Best-in-Class Benchmarking Analysis to provide employers with insights and best practices for managing benefit costs while also attracting and retaining top talent. The analysis uses selected data from 997 midsize employers and 269 large employers that responded to Gallagher’s 2016 Benefits Strategy & Benchmarking Survey. View the analysis here.