4 ways advisers can match benefits with client needs
In the last 10 years, the U.S. workforce has grown more generationally diverse. Until recently, baby boomers (those born between 1946 and 1964) were the dominant demographic in most businesses. However, millennials (those born between 1979 and 1996) now outnumber boomers, and, by 2020, will make up half of the employee population in the United States. In addition, Generation X continues to represent a vital, albeit smaller, portion of the workforce, while Generation Z will start to enter the workforce soon.
Each of these generations seeks a different mix of benefits, making it challenging for small and midsized business owners to determine the best benefits package to attract and retain great employees. Here are four insights advisers should keep in mind as they counsel clients on matching benefits with the specific needs of their workforce.
- Financial wellness transcends generations. A report from ADP found a growing number of employers are interested in financial wellness programs. Whether it’s helping employees pay off student debt or juggle elder care and college tuition, financial wellness programs can be a great way for small and midsized businesses to recruit and retain workers. Beyond the recruitment and retention benefits, financial wellness programs also can have a positive impact on a company’s bottom line. A SHRM study found that 47% of human resource professionals surveyed said personal financial challenges impact an employee’s ability to focus, and half said it impacts an employee’s overall stress.
- Flexibility is important to millennial workers. Millennials want more control over their personal and work schedules. According to a study from PwC, 95% of respondents said work/life balance is important to them. This generation sees work and personal life integrated — and they want the ability to get their jobs done as they see fit. Flexibility also means the ability to work remotely, as needed. With new technology making it easier for employees to work from anywhere, flexibility programs can be a great way for business owners to increase employee satisfaction without increasing the cost of their benefits program.
- Business owners should consider a broader approach to time off. In recent years, a number of large companies have introduced unlimited vacation programs. While this may not be feasible for a small or midsized business, merging all time off into one paid time off program can give employees more choice. This broader approach could be especially beneficial for increasing satisfaction among employees seeking greater flexibility. Employers who opt for a single PTO policy must ensure compliance with state and local mandated paid sick leave laws.
- Voluntary benefits can help control costs. Cost often limits the type of benefits small and midsized businesses can offer. However, a voluntary benefits program can help small companies offer more benefits options without increasing costs. Voluntary benefits programs, such as home and auto insurance, employee purchase and discount programs, allow employers to appeal to everyone regardless of generation.
For many businesses owners, creating a benefits program that addresses the needs of a multigenerational workforce can be an ongoing challenge. To help small and midsized employers create a compelling benefits package to attract and retain the best workers, benefit advisers should partner with their clients to refine their offerings to give employees more options to build the benefits package that best meets their individual needs. Advisers also can help businesses match the number of options they offer to their current workforce and determine if and when to limit choices within each benefit to manage costs. Benefits are key in the war for talent, and benefit advisers can help small and midsized business owners gain a competitive advantage by matching the right benefits to today’s multigenerational workforce.