Benefits Underused to Recruit, Retain, SHRM Finds

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Only a quarter of organizations use their workplace benefits program to help recruit employees, according to survey findings released by the Society for Human Resource Management (SHRM) in December 2013. And less than one in five report trumpeting the value of the workplace benefits to retain current employees.

While half of those surveyed indicate they are having difficulty recruiting highly skilled employees, only 30 percent are leveraging their benefits program specifically to recruit these in-demand workers. Even fewer use their benefits' appeal to retain highly skilled employees.

Among the organizations that do stress their benefits to recruit and retain employees, health care and retirement savings remain the top two benefits touted, as in previous years. On the heels of these are leave benefits and professional and career development benefits.

"Considering that wage growth has been very weak in the post-recession economy, HR professionals frequently cannot use higher salaries as a draw for attracting and keeping talent," said Joseph Coombs, SHRM's senior analyst for workforce trends. "Many recruiters now advocate using a 'total rewards' approach to recruitment and retention, leveraging an employer’s benefit package as part of that strategy."

Communicating Benefits

Workplace benefits can't be used for either recruitment or retention if their value isn't communicated. But only about a quarter of organizations had an employee-benefits communication budget in fiscal year 2012.

The top three methods that employers rely on to inform workers about their benefits are online or paper enrollment materials, group employee-benefits meetings and one-to-one employee-benefits counseling with an organizational representative.

And just 3 percent of organizations are using social media in their communication efforts. Among those not using social media for this purpose, 8 percent plan to start doing so within the next 12 months.

"Most organizations are not using social media channels for benefits-related communications; however, that may change in the future, perhaps due to employers’ increased use of social media in other aspects of business operations, as well as workers’ increased comfort with those forms of technology," said Coombs.

Controlling Health Care Costs

Among other survey findings, the majority of organizations (83 percent) are “very concerned” about controlling health care costs. The top three activities employers have engaged in to control these costs are:

  • Providing educational initiatives related to health and wellness (45 percent). 
  • Increasing employee participation in preventive health and wellness initiatives (43 percent). 
  • Creating an organizational culture that promotes health and wellness (41 percent).

These strategies have shifted from the previous year, when increasing the employee share of the total costs of health care and providing lower-cost generic prescription/over-the-counter drugs were the most common steps taken.

When asked in May 2013 what they expected to do for plan year 2014, 24 percent of organizations said they intended to increase the share that employees contribute to the total costs of health care, 21 percent did not plan to increase the employee share, and 55 percent were unsure.

Focusing on the next three to five years, 21 percent of organizations currently paying the majority or an equal portion of health care costs believe that their employees will eventually pay the majority of them.

"As health care costs continue to increase, HR professionals will have to determine modifications to their organization’s health benefit plan and whether these changes will have any impact on their organization’s overall total rewards strategy,” Coombs observed. “For instance, will trimming or eliminating health care benefits hinder an organization’s ability to attract and retain talent?"

Promoting Wellness

Nearly three-quarters of employers that offer wellness initiatives indicated they were "very effective" or "somewhat effective" in reducing the costs of health care. Additionally, roughly three-quarters rated their wellness initiatives as “very effective” or “somewhat effective” in improving their employees’ health.

More than half of organizations (56 percent) offered wellness incentives or rewards. Of these, 82 percent said this tactic was very or somewhat effective in increasing employee participation in wellness initiatives.

"More employees are taking advantage of the wellness programs, resources or services that their employers are offering," Coombs commented. "The challenge remains in quantifying the impact of wellness programs. Organizations indicated they would be more likely to invest in wellness initiatives if they could measure the impact."

Fewer than three out of 10 organizations measure the return on investment or cost savings associated with wellness initiatives, although 71 percent believe that wellness initiatives are somewhat or very effective in reducing health care costs.

SHRM's six-part State of Employee Benefits in the Workplace series contains the following reports:

Stephen Miller, CEBS, is an online editor/manager for SHRM.

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