MetLife Releases Tenth Annual Survey of Employee Benefits Trends
MetLife, the well-known insurance and financial services company, has released its Tenth Annual Survey of Employee Benefits Trends. The survey, conducted in the fall of 2011, included the results of 1,519 interviews with benefits decision makers at companies with staff sizes of at least two employees, as well as 1,412 interviews with full-time adult employees age 21 or older, nationwide.
Highlights
Among the key findings of the survey:
- More than half — 52 percent — of employee’s ages 21 to 30 are very worried about running out of money in retirement. This is a significant increase from 2003, when only 33 percent of employees in this age range expressed the same worry. This indicates how heavily the more difficult economic environment has been weighing on younger workers.
- Workers are less focused on savings growth now and more focused on creating a reliable income stream compared to survey participants ten years ago. This indicates that annuities may have more of a place in employee retirement plans than they did in prior years.
- Voluntary benefits — funded via payroll deductions — are much more prominent now, with tremendous growth at smaller employers. In 2003, voluntary payroll-deduction plans were primarily found at large employers. Now even very small employers are increasingly offering these plans as employee benefits.
- There is a strong correlation between satisfaction with benefits and overall job satisfaction. It is very uncommon for employees to report being satisfied with their jobs while being unsatisfied with their benefits packages, and vice versa.
- The vast majority of employers — 70 percent — plan to maintain or improve their benefits packages, despite the comparatively weak economy. Thirty percent anticipated doing so by increasing employee costs, however.
- Forty-one percent of employers report that voluntary benefits are a significant part of their employee-retention strategy. This is a significant increase from the 32 percent that reported the same a year ago.
- Employees are more appreciative of the value of their benefits packages than they were in years past.
Some of the survey’s findings indicated challenges for today’s employers. Overall, employee loyalty to current employers was lower than it has been for seven years, and fully one-third of employees were hoping to be working somewhere else within a year. Younger employees were significantly more likely than older employees to report wanting to jump ship. In part, this is because 60 percent of companies did in fact reduce head count during the recent economic downturn. Younger employees may have little experience in the workplace beyond this last period of austerity, when companies were actively slashing payrolls, increasing workloads for remaining employees, and cutting benefits.
That said, younger employees are looking more to employee benefit packages to help them achieve their financial objectives than their older cohorts did at the same age.
Workers also rely on their employers even for basic insurance coverages that prior generations routinely bought outside of the workplace. Although their parents bought life and disability insurance at the kitchen table from an agent, over 60 percent of today’s employees get their life insurance coverage and disability coverage through work.
The influx of Generation Y workers, or millennials, now in their 20s, is profoundly affecting the overall employer-employee relationship. These younger workers anticipate more career mobility than their forebears and are less trusting of companies’ commitment to them as workers, perhaps because much of their adult lives has been spent working in an era in which companies were going out of business or cutting back in large numbers. But Generation Y and X workers are more eager for financial education and financial planning services via their employers than previous generations were.
The MetLife survey also found that a significant fraction of employees — 25 percent — were substantially behind in their financial planning objectives. But a recent survey from CreditDonkey indicates that the problem may be even worse than MetLife found: Some 40 percent of Americans don’t have $500 in savings.
Conclusion
Among the most significant findings of the survey was the growth potential in the employer relationships with younger workers. While Generation Y workers are less loyal to their current employers, they are also significantly more likely to value benefits than their forebears were, and more than six in ten reported that they were relying on their employee benefit packages for their long-term financial health. That was true of 55 percent of Generation X workers, 42 percent of younger boomers, and 31 percent of older boomers.
So there is an opportunity there for employees to cement their relationships with younger workers. But they haven’t yet closed the deal.
At Cleary, we know how important a comprehensive benefits package can be to your continued success. Give us a call today at 617-723-0700 and we will work with you to create a plan that meets your business objectives, takes into account state and federal laws, and capitalizes on incentives and innovative solutions now being offered.
Client Spotlight
The Boston Debate League was created in 2005 to help improve students’ academic achievement. The league offers a host of after-school, weekend, and summer programs to help Boston students become advocates and intellectuals. Competitive academic debate offers a powerful means of engaging students in their own education and reversing negative trends. Debaters come from across the academic spectrum, including those who do not attend school regularly or are not thriving in the traditional classroom. The Rev. Dr. Gregory Groover, chair of the Boston School Committee, was this year’s Taking Sides for Success honoree. The event raised over $100,000 from the community to support local debate programs. The league’s 2012-2013 debate season began on October 19. Click here to view a complete tournament calendar.
Combating Absenteeism
The zombie apocalypse is upon us. It’s real, and according to recent studies it costs employers billions. But the zombies aren’t taking the form of the undead rising from the grave in a quest to consume the living. Instead, they take the form of exhausted, sick, injured, or demoralized employees showing up to work yet not performing to their full potential.
That’s the conclusion of a new study out of Brigham Young University, which determined that when it comes to damage to employers, the cost ratio of presenteeism versus absenteeism is three to one.
Researchers found that presenteeism was highly correlated with outside factors, including poor health, poor eating habits, financial stress, relationship problems, and other emotional problems originating outside the company. Workers become stressed and distracted and, because they are only human, their problems spill over into the workplace.
According to its chief researcher, the study looked at more than 20,000 workers. Among its findings:
- Those with bad diets were 66% more susceptible to presenteeism than those with healthy diets.
- Smokers reported productivity losses 28% more often than nonsmokers.
- Regular exercisers were 50% less likely than those who only exercised “occasionally” to succumb to presenteeism.
Contributing Factors
In addition to the normal litany of unavoidable minor issues, such as sick children at home or minor financial matters, employee problems can arise if management shuts down important stress valves:
Putting too much emphasis on attendance in workplace performance reviews
Disciplining or stigmatizing workers who call in sick on short notice
Expending managers’ valuable time “verifying” illnesses (a cost sink in itself!)
The Solution
The authors of the study concluded that the use of the cat-o’-nine-tails to improve workplace morale is probably suboptimal. Instead, they suggested some basic leadership and resourcing measures, such as helping managers and workers prioritize what is important and providing “sufficient technological support.” Other suggestions included implementing targeted wellness programs designed to address employees’ specific stressors. For example, where employees may be struggling with financial stressors, distracting them from their work, make financial-planning services available. If health issues are paramount, establish programs to help workers stop smoking, improve eating habits, and address physical and mental health issues.
Lowering presenteeism will require that employers have realistic expectations of workers, help workers prioritize, and provide sufficient technological support. Financial stress and concerns may warrant financial planning services. Health-promotion interventions aimed at improving physical and mental health also may contribute to reducing presenteeism.
Other ideas include sponsoring a workplace flu vaccination program, sending sick workers home immediately, and implementing a “no questions asked” PTO policy, as opposed to segregating sick days and personal-leave days. Leaders can also reward and encourage midline managers who are creative in allowing staffers flexible work arrangements — though care should still be taken to comply with wage and hour laws.
At Cleary, we know how important a comprehensive benefits package can be to your continued success. Give us a call today at 617-723-0700 and we will work with you to create a plan that meets your business objectives, takes into account state and federal laws, and capitalizes on incentives and innovative solutions now being offered.