COVID-19 pandemic has changed the way employers perceived employee wellness. More importantly, it pushed employers to make amends to their employee benefits and services. Employee voluntary benefits have taken up an even more important place and have been gathering a lot of attention.
The economy has taken a hard hit, and many employees were forced into unexpected financial hardships. As they look for ways to expand their income and recover from the pandemic, the focus has shifted to employee voluntary benefits.
Voluntary benefits are an excellent tool for employee retention and recruitment. For employees, voluntary benefits are a way of choosing the benefits and services they need. And so, voluntary benefits have become more appealing to employees of different generations. With voluntary benefits, employers are also shifting their priorities to ensure employee wellness.
Employers are looking for new ways to expand their voluntary benefits through their employee benefits package, and are looking to provide customized options to ensure the workforce needs, including non-traditional employee benefits like financial health, personal wellness, and more.
Blooming Of The Voluntary Benefits Industry
The past decade has seen voluntary benefits escalate at a compounded rate of 5% annually. On the other hand, employer-sponsored benefits were reduced. Of all the voluntary benefits services, disability income, dental exams, and other traditional insurance-related products like life insurance made up almost 60% of the business in 2019. However, there has also been an increase in non-traditional voluntary benefits like student loans, elder care-giving programs, and pet insurance. These non-traditional options were particularly preferred by younger employees, who also wanted customizable benefits.
Higher Growth Rate Of Voluntary Benefits That Help With Employee Financial Wellness
The COVID-19 pandemic has changed the financial situation and the way employers view employee holistic wellbeing. A study in September 2020 had almost 84% of American employees reporting that the COVID-19 pandemic has stressed them out due to personal financial crunches. 34% said they were concerned about their financial situation a few months from now. 50% of employees felt it was the right time for their employers to offer financial wellness programs and contribute to their emergency savings funds.
Customization Of Voluntary Benefits
Every employee has different benefits needs. Offering customization options to choose the voluntary benefits could stand out as the top options because of the pandemic. Unlike traditional employee benefits, customization options can include voluntary benefits, including pet insurance, employee purchase programs, and identity theft protection benefits. Through the employee purchase programs, employees can purchase health and wellness equipment to workout, ergonomic chairs for the workplace, or other wellbeing resources for the home. They can also use the payroll deduction system to make payments when cash or credit options are not available. Studies have shown that personalization of employee benefits can have long-term benefits. A Mercer study showed that 22% of employers plan to include mental health benefits and critical illness insurance to enhance their voluntary benefits offerings.
Employees Reviewing Their Workplace Benefits
Before the COVID-19 pandemic, most employees overlooked most of the available workplace benefits and services. However, post-COVID-19 financial issues, employees are looking closely into their workplace benefits and resources. A study showed that nearly 71% of the workforce plan to spend more time to review their current employee benefits and voluntary offerings than the previous year. Also, 53% were looking to make changes to their benefits plans and coverages.
As employers are expanding their employee benefits, 2021 may see a higher growth rate in employees opting for voluntary service offerings to overcome their financial challenges. In 2021, voluntary benefits like student loan repayment facilities, employee purchase programs, financial counseling, and similar programs may get more traction to recover from the financial troubles caused due to the pandemic. With options to choose the best suited voluntary benefits can help them recover from their stressors and boost overall employee wellness.