The pandemic changed where and how we worked, and the use of generative AI is shifting the way we work once again. In fact, 72% of business leaders report that a skills gap in their workforce will create greater challenges for their business in the future. Attracting and retaining top talent is and will continue to be essential to companies’ ability to succeed in our evolving technological and economic era. To continue to be successful, companies will need to meet employee expectations and provide them with meaningful benefits that have an impact on employees’ lives. 

There’s a growing cultural consensus in the U.S. that employers should take a less transactional approach to benefits and offer more holistic support for their employees. In fact, 1 in 3 employees would forgo a pay increase in return for more benefits for them and their families. So in order to ensure they can attract and retain the talent they need, companies will need to understand what employees want, why they want it, and how to give it to them in an impactful way. They will need to invest in whole-person health, increase employee adoption of, and engagement with, their benefits, and they will need to use plan optimization and data transparency to avoid shifting higher costs onto their workers.

By doing so, companies can ensure they are offering an impactful benefits package that moves the needle in terms of talent acquisition and retention.

How to understand what your workforce needs and why

The current workforce is made up of four generations: Boomers, Gen X, Millennials (Gen Y), and Gen Z. Each generation faces unique challenges and has their own perspective on what their employer’s responsibility is when it comes to helping them navigate those challenges. A recent report from the Marsh McLennan Agency showed this is what each generation wants and why:

Boomers

Boomers are workers aged 58-77. They are nearing the end of their professional working life, so Boomers want stability so they can ensure they are set up for their next chapter. They want job security, help in achieving financial security so they can retire, and an expansion of menopause care and preventative screenings. As they look towards retirement, the baby boom generation wants to ensure their financial and physical health. 

Gen X

Gen X workers are aged 43-57. They are in the throes of managing professional and family life, Gen X employees want work-life balance. They are raising young children and teenagers, as well as caring for aging parents, so they have to juggle multiple responsibilities. They want flexible work schedules, caregiving benefits, and financial benefits that help them save for their future.

Millennials (Gen Y)

Millennial workers are aged 27-42. Like Gen X, Millennials are also managing caregiving and professional duties. They want freedom and flexibility to manage their time and resources as works best for them. They’re sensitive to student loan debt and see it as an impediment to financial health. They want their employers to lighten their financial load. They are looking for caregiving benefits, more affordable health insurance, lower pharmaceutical costs, and help paying for their out-of-pocket expenses.

Gen Z

Workers are considered Gen Z if they are 26 years of age or younger. The youngest generation in the workforce, attitudes have come full circle with Gen Z. Like their boomer counterparts,they crave security and stability. This generation is experiencing high work-related burnout and wants employer support in the form of more robust mental health benefits. They also have the highest rates of urgent care and ER visits of any of the generations and the lowest rates of preventative care. They could benefit from a health insurance plan that offers free preventative care like a High Deductible Health Plan (HDHP).

To fully understand the challenges that your specific workforce are facing and how to effectively support them, it’s important to collect data directly from your team. Here are some good ways to find out how impactful your benefits package currently is:

• Send out an employee survey. 

• Ask for feedback from your leadership teams. 

• Analyze plan usage data. 

• Gather market information from trusted sources like your benefits broker.

For a more in-depth look at how the different generations interact with their benefits, check out our post, 4 Generations in the Workforce: Who They Are, What They Want, and How They Utilize the Healthcare System.  

Increase benefit adoption by curating your communication strategy

You may already be offering a comprehensive benefits package, but if your employees aren’t using them, it’s a waste of resources. To ensure your employees both know about the benefits that are available and how to get the most out of those benefits, you must communicate in a way that meets them where they are.

Each generation has their own preferred communication style and channel through which they want to receive information. If you’re using a one-size-fits-all approach to your communication campaign, your benefits strategy will lose impact. It’s also important to remember that communication during open enrollment is critical, but it’s not one-and-done during this period. Communicating all year-round will not only help your employees to get the most out of the benefits they chose, but it can also help the next open enrollment season to go more smoothly. 

As employees experience life events, they might need different resources and it’s important to remind them of the support they have. If employees miss out on benefit features because they didn’t know or forgot they existed, the effect is the same as if you didn’t offer the benefits at all. 

The most impactful communication strategy will have the following components:

• Year-round, with timely information to not only help employees choose the right benefits but to get the most out of them as well.

• Multi-channel communication campaigns.

• Crafted using a variety of communication styles to meet each generation where they are.

Here is an overview of channels and tone each generation prefers to communicate:

• Boomers: Prefer more formal communication like email, brochures, and face-to-face meetings like town halls.

• Gen X: Prefer an informal but direct style of communication. Email and text messaging are effective communication channels with this generation.

• Millennials: Prefer informal communication in the form of texts or online chat.

• Gen Z: Prefer personalized in-person communication and video calls.

An efficient way to develop a comprehensive communication strategy is to leverage tools that your benefits broker and benefits administrator already have and services they provide. For example, your benefits broker can host digital town halls and meetings to present benefit information and answer questions. They can also make themselves available via email or chat if employees have questions about how their benefits function, coverage levels, eligible expenses and more.

A good benefits provider will partner with you to onboard and educate employees so they get the most of their benefits. You’ll want to look for a company that offers an online resource library where employees can do their own research, offers push-notifications that keep employees updated, and can provide you with readymade materials.

Invest in whole person health

Whole-person health is the idea that employers must ensure their employees have the support in place to be healthy on all levels. That way employees can bring their most productive selves to work. Companies must address not just an employee’s physical health from a medical standpoint, but also the various other factors that affect their wellness. These factors include: physical health, mental health, social determinants of health, and financial health. 

If this seems like it’s outside of the normal employer responsibility, ten years ago, you might have been right. But the scope of employer responsibility has broadened since the pandemic. In fact, 78% of employees now feel as though it’s their employer’s responsibility to help them become “net better off” than they were before starting work at the company. And 95% of employers are responding to this sentiment with at least one action to address it.

Investing in whole-person health goes beyond supporting recruiting and retention. It can help boost productivity and reduce future increases in healthcare spending. That’s because employees with at least one unmet basic need can expect healthcare costs that are 10% higher than those whose needs are met. Research also suggests that for every $1 invested in an employee’s mental health, the employer can save $2-4 on other expenses such as healthcare costs. 

Use plan optimization and data transparency to avoid shifting higher healthcare costs to employees 

Employees, especially those from younger generations, are already feeling the squeeze from higher healthcare costs. Healthcare costs rose 5.2% in 2023, with the average cost of benefit increase being higher for medium and small-sized companies. The continuous rise in healthcare costs has caused many U.S. workers to go without needed treatment. 

In fact, 38% of Americans have put off medical treatment in the last 12 months due to cost. Putting off medical treatment, including preventative care visits, leads to more adverse (and expensive) health outcomes, more expensive urgent care and ER visits, and higher health insurance and medical costs across the board.

There are many factors that affect the rise in healthcare costs, some of which are completely out of employers’ control. But employers can take targeted actions to minimize the increase in organizational spend as well as employee cost increase over the coming years.

One impactful action employers can take is to optimize their benefit plans. Effectively optimized benefits plans improve talent retention and recruitment, they boost employees’ engagement with their benefits and subsequent health outcomes because of that engagement.

To optimize your benefits plans you should:

• Collect and interpret data on which benefits employees are using and use it to inform strategies on how to strengthen the value your benefits bring to employees. For example, if you’re experiencing higher health costs related to fatigue and burnout, you could offer new mental health benefits as a strategy to curb further cost increases.

• Track reimbursements from fringe benefit accounts to see trends in real time. Companies can use this spending information to determine what type of support they should add next.

• If there are under-utilized benefits, determine whether it’s the benefit itself that’s the problem or if it’s a communication issue. If it’s the benefit itself, find a different solution to the problem that benefit was designed to address. If it’s a communication issue, reexamine your communication campaigns to see where they fell short.

• Utilize technology to gather data and run reports instantly so you can see in real time which benefits are most effective. 

• Once you know how and why employees are using their benefits, use the information to streamline your offerings or offer additional support.

By optimizing your benefits plan, you will have efficient and effective benefit offerings that properly support your employees and your business and talent objectives.

Get started with Lively today

Lively is your partner in crafting the most impactful benefits plans for your employees. We offer a wide range of benefits that can be bundled for easy benefits administration as well as competitive pricing. Our intuitive and intelligent dashboard also ensures your HR department has the data it needs to make actionable decisions that move the needle both from a talent and business perspective. We offer best-in-class customer support, communication materials and onboarding. If you’re ready to uplevel your benefits, reach out today.