The workforce is changing as Baby Boomers continue to retire and Generation Z starts taking their place, and with a “changing of the guards” comes a change in the types of benefits you use to attract and retain top talent. If you haven’t been staying up to date on the latest trends, don’t worry—we’ve outlined them below!
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A new global survey released by Workhuman®, a provider of human applications, shows that talent attraction and retention lie in meaningful work and creating a human-focused environment that’s built upon trust, recognition, respect, gratitude, autonomy, and equity. So basically, workers want a great company culture.
The report, “The Future of Work is Human,” surveyed more than 3,500 people in the United States, the United Kingdom, Canada, and Ireland and gives leaders and executives a glimpse at the future of work as told from the people’s perspectives.
The study, published by the Workhuman Analytics & Research Institute, provides insights to help employers improve engagement, recruitment, retention, and performance management, the end goal being to create work cultures that are mutually beneficial to businesses and the people driving them.
Meaningful Work Is Important for Young Workers
One of the survey’s most important findings is that workers across all age groups rank meaningful work as the most important aspect of their career, beating out positive company culture, compensation and perks, a supportive manager, and a fun team.
Younger employees (ages 18–24) are more likely to rank a supportive manager as the second most important aspect of their career, while workers 35 and older are more likely to rank compensation and perks second to meaningful work. The survey also revealed that workers are four times as likely to report loving their job when they have a sense of meaning and purpose at work.
“In this job seeker’s market, employees are actively seeking out more human-focused work environments where they have an emotional connection to their work and their company’s mission,” says Eric Mosley, CEO of Workhuman, in a press release. “As humans are very much at the heart of the future of work, companies must focus on their workers’ core human needs and double down on inspiring meaningful work where employees feel recognized, respected, and empowered to do the best work of their lives.”
Respect and Recognition from Senior Leaders Prove Meaningful for All
The report also found that frequent recognition—particularly recognition that can be given by everyone—appreciation, and informal check-ins play a large role in building connections and improving employees’ trust in senior leadership.
In fact, workers who have given recognition and expressed gratitude in the last month are 26% more likely to trust their company’s senior leadership team than workers who have never expressed gratitude at work (72% vs. 57%).
Additionally, workers who check in with their manager at least weekly as opposed to never are more than two times as likely to trust their manager, five times less likely to be disengaged, and nearly two times as likely to believe they can grow in the organization.
Top 6 Ways Company Culture Impacts Employee Engagement/Retention
The report also looked at several key workplace issues that directly impact employee well-being and humanity, such as diversity and inclusion, gender equity, discrimination, and celebration of work anniversaries.
Workhuman’s report discovered six key trends related to company culture and how it pertains to employee engagement and retention, as outlined below:
1. One in four workers has felt discriminated against over the course of his or her career. More than half of all workers surveyed chose age as the top factor driving discrimination. However, discrimination is not the top reason people don’t feel safe at work. Employees ranked a toxic work culture as their top choice, followed by race/gender discrimination and physical risks.
2. Women in senior and middle management are more likely to have experienced some form of workplace discrimination. About one in four women in senior management or executive roles says she does not have a good work/life balance compared with men.
3. Recent, frequent recognition is associated with higher gratitude levels and lower stress levels. Trust is another form of relational currency that can be leveraged during times of change and uncertainty at work. Data indicate frequent recognition can help here, as well. Workers recognized in the last month at companies that have been through a merger or an acquisition in the last year are nearly two times as likely to trust in their company’s leadership team compared with those who have never been recognized for their work (82% vs. 46%).
4. Women in senior management or executive positions who were surveyed are less likely to receive a higher bonus and more likely to receive a smaller bonus than men. More than half of women surveyed in middle and frontline management positions say a manager has taken credit for their work.
5. More than half of all workers surveyed (51%) say their last work anniversary was not acknowledged. While unfortunate, the results aren’t surprising. Too many companies rely on a one-dimensional, manager-driven approach to celebrating service anniversaries and career milestones. When the data are filtered by workers who have been at their company for more than 8 years, that number ticks up slightly to 53%.
When work anniversaries were recognized, 64% of respondents said it did not make them feel a renewed commitment to the company, and 53% said it made them feel nothing at all. To improve the anniversary experience, workers said they would prefer shared memories and congratulations from coworkers and managers, as well as private and public congratulations from a manager.
6. The number one perk reported as the most important by workers across all ages, regions, and industries is remote/flexible work (41%), followed by healthcare coverage (27%). Other perks include tuition reimbursement, wellness programs, parental leave, referral bonuses, free food, and an on-site gym.
While the Workhuman report focuses a lot on providing a meaningful work experience through recognition and company culture, a different survey is providing insight into what types of tangible benefits employers are offering staff.
Are Employers on the Same Page When It Comes to Benefits?
According to the Arthur J. Gallagher & Co.’s (Gallagher) 2019 Benefits Strategy & Benchmarking Survey, nearly three-quarters (73%) of employers increased employee compensation this year, and more than half (52%) enhanced medical benefits.
Even with compensation enhancements, voluntary employee turnover remains a stubborn challenge, with one-third (32%) of employers reporting full-time turnover in excess of 15% in 2018. That figure has increased by 8 percentage points from 2016. In light of this, attracting and retaining a competitive workforce remains the top priority for both operational and Human Resources executives.
“More employers appear to be thinking strategically about their benefit and compensation strategies to win the war for talent, but there’s a question about whether these efforts are ultimately paying off,” says William F. Ziebell, CEO of Gallagher Employee Benefits Consulting and Brokerage, in a press release. “Our 2019 Benefits Strategy & Benchmarking Survey finds successful employers create and communicate stronger cultural attachment points that resonate with the wants and needs of talent—in support of their employees’ health, financial security, and career growth.”
As reported above, when it comes to “tangible” benefits, flexible work ranked number one for Workhuman respondents, but according to Gallagher, employers are putting health care at the top of their lists when it comes to benefits offerings.
Employers Leaning into HDHPs and Technology to Curb Medical Costs
The high costs of medical services (67%) and prescription drugs (42%) continue to put a significant burden on employers’ and employees’ budgets. For more than a decade, employers used cost-sharing methods to keep their expenses in check, but the tight labor market has slowed this trend. Almost half (47%) did not increase their employees’ cost-share spend in 2019.
As an alternative, forward-thinking employers are creating health-plan structures based on incentives and value. For example, 2019 marked the first time the majority (51%) of employers offered high-deductible health plans (HDHPs), which allow employees to pay lower premiums. The trend has resonated with employees, and employers note HDHPs had the second-highest enrollment (24%) among their employees in 2019.
While high prescription drug prices are a cause for concern, the survey surprisingly found many employers fail to capitalize on tactics that could significantly reduce costs. For example, more than half (55%) of organizations do not have or are not aware of whether they have tactics in place to manage specialty-drug costs. And many that have deployed tactics are not tracking the results, often deferring to their health plan or pharmacy benefit manager instead.
Additionally, specialty pharmacy mandates that require employees to purchase specialty drugs through a specific pharmacy have relatively low adoption rates (20%). By exploring such options, employers will help to curb their organizations’ and their employees’ prescription drug expenses.
While there is room for improvement with prescription drug strategies, employers have been eager to adopt proven methods to reduce medical costs. Three of the most common include telemedicine offerings (52%), health plan premium increases (42%), and well-being incentives (41%).
Employers Turn to Wellness Benefits to Stand Out
More than two-thirds (69%) of employers offer resources to promote employee health or well-being. However, employers are moving beyond traditional wellness benefits that focus solely on employees’ physical health, such as flu shots, tobacco cessation, and biometric screenings. Rather, 20% (up 2 points from 2018) have come to understand the need for a comprehensive whole-health and well-being strategy to attract and retain talent in a tight labor market.
In addition, the survey found between 31% and 40% of employers have revamped their total-rewards offering by enhancing supplemental and voluntary benefits, expanding leave policies, adding well-being initiatives, and/or enriching retirement benefits as a way to appeal to their existing and prospective employees. The supplemental health insurance electives that are most often covered in 2019 include:
- Autism treatment (64%),
- Hearing aids (48%),
- Bariatric surgery (47%), and
- Infertility services or fertility treatment (46%).
Flexibility and Financial Wellness Make the Cut
For a significant number of employers, taking a holistic approach to benefits and compensation offerings includes an emphasis on employees’ financial well-being, as personal financial struggles can negatively impact productivity.
Since 2017, 41% of employers indicate they have increased their emphasis on their employees’ financial well-being. Nearly 7 in 10 (69%) employers provide employees with access to financial advisers, which is a 7-point increase from 2018. More than half (54%) offer financial-literacy education opportunities—a 7-point increase from the previous year.
Creativity and flexibility on the part of the employer have gone a long way to align organizational goals with employees’ lifestyle needs. As a result, more than one in four employers allow telecommuting either full-time (26%) or part-time (29%). Additionally, more than half (54%) of organizations offer flex time—the ability to transfer hours from 1 day or work shift to another.
As you can see, two drastically different surveys highlight one important theme: Benefits continue to be vital for talent attraction and retention. Although workers say they want meaningful work and a good company culture, employers have other ideas in mind! Employers are continuing to focus heavily on employee health and wellness, which makes sense. Keeping workers healthy and happy is the truest way to retain top talent.