Warren Hersch’s recent LifeHealthPro article summarizes a Guardian study that sheds light on the role benefits play in employee loyalty. According to the study, American workers want more benefit options and a simpler, guided enrollment process backed by online support. Consequently, those do who have a positive enrollment experience tend to be more loyal their companies.
Many workers envision an employee benefits shopping and buying experience radically different than it is today, but similar to some of their better online retail experiences. As employees look to have more choices, proper decision support is integral to employer goals. A broad benefits menu combined with highly effective decision support yields a very strong perceived value of benefits.
Interestingly, most working Americans surveyed by Guardian say they have a “good understanding” of their workplace benefits and believe they can make good benefits decisions. Their answers to a Guardian quiz about benefits coverage and terminology, however, betrays a knowledge gap. Employees score an average grade of 72 or a C, with 51 percent earning a grade of C or below. Early baby boomers faired marginally better, whereas a quarter of millennials received a failing grade.
A disconnect is in evidence, too, in a comparison of employees’ and employers’ answers to questions about company-provided benefits. Whereas 8 in 10 U.S. workers say they understand their benefits “very well” and nearly as many 74 percent express confidence in their benefits elections, just 62 percent of employers believe their workers have a “strong understanding” of company-provided benefits. Fewer than 1 in 5 (17 percent) say their employees grasp the financial value of these benefits.
Employees with the most confidence in their benefits elections include:
- Those who use a financial advisor: 72 percent of those with an advisor are highly confident vs. 58 percent of those without one.
- Early boomers: 71 percent of boomers age 57 or older are highly confident vs. 54 percent of millennials.
- Those with higher incomes: 70 percent of those with at least $100,000 in annual household income are highly confident vs. 50 percent of those earning less than $50,000.
- Those who work for large companies: 63 percent of those working for companies with 1,000 or more employees are highly confident vs. 45 percent of those in companies with fewer than 50 employees.
- Early boomers are the most confident about their employee benefits knowledge. They received the highest grades on the IQ quiz; 1 in 3 received an A.
Better benefits education is a clear message, as, according to the survey, less than half (47 percent) feel their employer is doing a good job educating them about how to use their benefits — a sharp drop from 66 percent two years ago.