As employers navigate the tightest job market in 50 years, new research suggests they need to consider shifting their employee benefits strategies to attract and retain an increasingly diverse workforce.
A recent LIMRA and EY joint study, Harnessing Growth and Seizing Opportunity: The Future of Workforce Benefits, predicts nonmedical and nontraditional workplace benefits will grow 20% by 2026 due to heightened competition for workers and greater employee expectations.
“The current workforce consists of five generations of workers with distinct priorities and needs when it comes to benefits,” said Kimberly Landry, associate research director, LIMRA workplace benefits research. “Over the next five years, employers say they expect they will have to strengthen their benefit offerings in order to attract and retain top talent.”
The study explored how employers, brokers, and others in the workplace benefits space expect workplace benefits to change as the workforce evolves. Six in 10 employers believe employees will have greater influence over their company’s benefit decisions in the next five years. According to the research, three-quarters of employers plan to modify their benefits packages in response to shifting employee demographics.
From a strategic perspective, employers will increasingly use technology to support the communication, delivery, and enrollment of benefits packages. The study finds that 70% of employers expect to rely more on technology from third-party vendors. Sixty-eight percent of employers will rely more on digital enrollment, and 43% of employers want their workers to receive considerable support and assistance with enrollment.
In terms of what specific benefits they will offer, employers believe their employees will be very interested in life insurance benefits (53%), paid family or medical leave (49%), and other nontraditional and nonmedical benefits. COVID-19 caused a shift in people’s priorities; family, physical health, mental health, and finances are seen as more important today than pre-pandemic. Employees would likely be interested in benefits that align with these priorities.
Today’s workers are more aware of the value of workplace benefits than they were before the pandemic. The LIMRA and EY study reveals that 36% of employees view insurance benefits through work as more valuable today than pre-pandemic. The same is true for insurance products in general including health insurance (58%), life insurance (43%), and disability insurance (31%).
“Experiencing something as disruptive as a global pandemic has prompted workers to reexamine their benefits expectations and is leading employers to adjust their benefits packages to address the wider array of needs of their workforce,” noted Landry. “Employers may find more success in the talent market by supporting the employee on an individual level and providing expansive benefits that can cover a myriad of needs.”
LIMRA and LOMA members can access the complete LIMRA and EY report.