Quick Look: Adapting to trends while also focusing on what employees really want is essential to maintaining low turnover and an engaged work environment. SHRM has recently published its 2022 Employee Benefits Survey which shows the trends worth paying attention to as employers prepare for the upcoming benefits renewal season.
SHRM released its 2022 Employee Benefits Survey in June, revealing results collected between January 11 and February 28 of this year. The association sought out responses from SHRM members across various organizations to determine where the future of employee benefits is headed. The survey covers employee health benefits, retirement and savings, paid leave, and flexible work schedules as the top categories employers and their employees value most.
Employee health benefits
It’s no surprise to see mental health coverage as a benefit trend highlight, as numbers have skyrocketed since the beginning of the pandemic with people actively seeking mental health care and support. The increase in employer offerings has risen to 91% with equal accessibility deemed a high value for employees.
According to the SHRM survey, 20% of organizations revealed they offer paid mental health days separate from regular sick leave, and 93% of organizations offer telemedicine or telehealth as part of the benefits offered to employees. In addition to mental health coverage, the option of virtual health care has increased in importance. With most familiarizing themselves with Zoom due to stay-at-home orders early on in the pandemic, many realized the added convenience and accessibility video conferencing provided in terms of their care.
Telehealth allows employees to connect with their chosen healthcare providers at dates and times convenient to their schedules without transportation, taking time off work, and limited resources serving as barriers. With regards to health care plans, in general, 72% of organizations say they offer a fully insured health plan and 26% say they offer a self-insured plan. Health flexible spending accounts (FSAs) are also favored among those surveyed with 63% offering FSAs to their employees and 57% offering health savings accounts (HSAs).
Retirement and savings
Though retirement and savings were still deemed valuable pre-pandemic, the idea of saving seemed lower on the priority list as people were adjusting to furloughs and layoffs and eventually, voluntary resignations and career changes. The focus was on surviving rather than saving. However, since operations have resumed and established their new normal, it feels more secure to plan for the future, both from an employer and employee perspective.
In 2020 and 2021, 55% of organizations marked saving for retirement as an important benefit, which has since jumped to 82% in 2022 as one of the most popular types of benefits employers can offer. Currently, 51% of surveyed organizations auto-enroll new employees into their company’s retirement plan, a percentage which has held steady since the pandemic began.
The SHRM survey also reports 94% of organizations offer a traditional 401(k) as part of their employee benefits and 68% offer a Roth 401(k). Of those offering retirement plan options, 83% contribute with (varied) employer matches for 401(k)s, and 76% contribute to Roth 401(k) plans. The average salary match by employers was a maximum of 6.8% and 6.7% for each type of plan, respectively.
Medical, family, and personal leave
Paid leave of absence is also high on the priority list among organizations. Along with healthcare and retirement employee benefits, paid leave remains a top-ranking offering among most employers. However, the percentage of organizations offering leave beyond what’s required by law has dropped in some areas since 2020. Paid maternity leave fell from 53% in 2020 to 35% in 2022. Additionally, paid adoption leave dropped to 28% from 36%.
Though 99% of employers still offer standard paid vacation leave, 96% offer paid sick leave, and 67% combine the two with a general paid time off “bank” to cover both types. Meanwhile, unlimited PTO has grown in popularity among employees and job candidates, yet only 6% reported offering this benefit. However, employers are open to the flexibility and work-life balance employees now crave. The pandemic forced people to stay at home which turned into an opportunity to reevaluate where and how they spend their time.
As a result, 63% of employers offer a hybrid work model allowing employees to combine remote work with in-person office hours. And 62% also offer reimbursement for at-home office or work equipment, averaging approximately $891 per employee to cover costs of working from home.
Maximizing value by following the right trends
In many ways, the priority of employee benefits hasn’t changed too drastically. Healthcare, retirement, and paid leave will always be essential to round out a competitive compensation package. However, the way these are offered has changed as the workforce becomes increasingly mobile and focused on a healthy work-life balance. Employees want benefits to fit their lifestyles, not the other way around.
Fortunately, for employers, this means there doesn’t need to be a complete overhaul of employee benefits in order to provide great value. Instead, maintaining a continuous oversight of trends and gauging how employees are benefiting will ensure companies are optimizing their recruitment and retention strategies. Making smaller tweaks versus huge adjustments also allows for better planning and pivoting as necessary.
Keeping track of changes regarding HR laws and trends, as well as costs and offerings requires full-time attention and expert review. Here’s where a professional employer organization (PEO) like ExtensisHR can step in and support businesses so they can focus on other areas of company growth. In addition to benefits, ExtensisHR also handles payroll, risk management and compliance, and full-service recruiting responsibilities in a personalized way to help leaders optimize operations.
Finding what fits best for each company requires a tailored approach and mixing trends with workforce needs. Get the expertise, technology, and personable management you need to keep costs on budget, employees happy, and candidates excited about your company. Contact ExtensisHR today.