The perfect storm in the job market and the financial well-being benefits that may help employers weather it
A perfect storm has emerged in the job market: a burgeoning endemic, rising inflation, and employees who are feeling the pressure and throwing in the…
A perfect storm has emerged in the job market: a burgeoning endemic, rising inflation, and employees who are feeling the pressure and throwing in the towel. Standard employee benefits have been jolted into overdrive with human resource professionals becoming extremely creative with the ways they entice prospective employees and keep existing ones.
While the Bureau of Labor & Statistics and other research entities tell us what’s changed within the job market and predict what may be on the horizon, one thing has remained constant: financial stress.
More than half (51%) of full-time employees anticipated their financial stress level would be the same or worse in January 2022 than in January 2021, according to 2021 research by the Harris Poll on behalf of Purchasing Power. And it wasn’t just employees with lower household incomes who said their financial stress level would be the same or worse. It was true for employees in all household income levels, including 59% of those making over $75,000 and 49% making over $100,000.
Today’s employee is looking for employers to offer competitive wages and salaries, better benefits, a balanced life, and a way to address their financial stress. To remain competitive, employers should consider all aspects of what may contribute to a person’s financial state when life happens: unplanned or unexpected expenses surface, or financial struggles continue.
This includes everything from retirement benefits, tuition reimbursement, loan assistance, and more. Here’s why:
Employee financial stress impacts employers – and ultimately, the bottom line.
A recent John Hancock study revealed that the cost of financial stress per employee has increased 26% during the pandemic. And employees who have financial stress admit it affects their work. In the Harris Poll, 33% of employees said financial stress affects their physical health; 24% reported that it affects their ability to focus at work; 21% said it affects their productivity at work; and 21% said it affects their job satisfaction.
The job market currently favors employees – who expect more.
The Great Resignation may not end anytime soon. In a Harris Poll on behalf of CareerArc released in December 2021, 23% of employees said they planned to resign from their jobs in the next 12 months, and the reasons may be surprising.
According to PwC’s August 2021 Pulse Survey, the top two reasons employees are leaving are: better wages/salaries, and for better benefits. Employers, on the other hand, believed the top two reasons were better wages/salaries and job flexibility. They ranked better benefits No. 4.
Even slight tweaks and adjustments to benefits can be a game changer when it comes to recruitment and retention efforts.
Employees say financial well-being benefits matter.
Employees are looking for a solution and they expect their employer to help, according to the Harris Poll on behalf of Purchasing Power:
- 78% of full-time employees reported that they can tell how much their employer cares about their financial well-being by the benefits they offer.
- 79% said they would be more likely to stay with their present employer if they offered more financial well-being benefits.
A better work experience is another reason employees are changing and leaving jobs. They want a better work-life balance, more family time, and an environment where they feel valued. One of the factors that indicate how much employees are valued is through the benefits employers offer – including financial well-being benefits.
Where do voluntary benefits come in?
Many voluntary benefits can be added to the employee benefits package at no cost to the employer. This is an ideal time for employers and benefit brokers to consider the entire financial well-being of the employee; conduct an assessment of the financial well-being benefits; and potentially make low or no cost changes based on direct employee feedback.
The Harris Poll asked employees which financial well-being benefit(s) they would be interested in taking advantage of if their employer offered them. Here’s their response:
- Employee purchase program, which includes the ability to purchase consumer products and services from a vendor directly through an employer and then pay for them over time via payroll deduction with no interest: 28%
- Bill payment programs, where an employee can make their recurring bill payments on-tie each month through payroll deduction: 27%
- Financial counseling, where the employer provides in-person and/or group education and counseling services by financial professionals: 24%
- Low interest installment loans: 24%
- Identity theft protection: 23%
- Medical deductible financing that could enable the employee to secure a low-interest loan to cover the deductible and then make monthly payments to pay it off: 20%
- Student loan repayment benefit program: 15%
With the availability of a variety of voluntary financial well-being benefits that can be added to the employee benefit package at no cost to the employer, there is no better time than now for employers to do so….and show that they care about their employees’ financial well-being.
