A company’s human resources department has weathered many challenges and changes over the past decade. A major shift in the way work is being done, changes in the preferences of employees, and the COVID-19 pandemic are just some of the factors that necessitate changes to the workplace and most HR functions. In this article, we’re giving you a rundown of the important benefits administration statistics you need to know.
Some challenges that human resources departments and professionals must consider and endure are employee engagement, talent hiring and retention, establishing and maintaining relationships, diversity and inclusivity, and an ever-changing landscape.
Are there areas that are a challenge?
Employee engagement has been a challenging aspect of the workplace. Employers’ success has fluctuated in this aspect, with gains attributed to improved transparency and communication. Still, the effects of the pandemic, as well as the after-effects, have caused diminishing returns.
Focusing on clear and constant communication can aid team members in contributing to and achieving the company’s mission, vision, and values.
Highlighting the relationship between employees’ daily tasks and business strategy would make staff feel more accomplished, engaged, invested, and appreciated. Employee benefits and compensation packages are instrumental in encouraging talent to join an organization.
Focus on workplace relationships has always been inadequate and lacks changes to the workplace, including support for healthy relationships. This is crucial considering how companies adapt to hybrid or remote working arrangements.
The remote or work-from-home setup undeniably affects the dynamics between teams and teammates. With no physical office and interaction, it is even more essential to foster alternative channels for communication.
Recent changes and challenges have given focus to the well-being of the workforce of an organization. These readjustments have placed customized benefit plans front and center, and addressing the staff’s concerns and issues may still be considered among the top HR issues. Companies are challenged and pushed to provide varied and enhanced benefits.
Important Benefits Administration statistics
This section presents a rundown of the latest HR statistics that may affect benefits management and may correlate to benefits management software’s importance and use. This information and statistics are taken from SHRM, Hartford, LinkedIn, WTW, and Paychex.
General Benefits Statistics:
93% – the percentage of organizations that provide telehealth and telemedicine as a benefit
83.2% – the percentage of employers that have given or would like to give focus on communication, employee education, and engagement for benefits delivery
90% – the percentage of employers that utilized a benefits marketplace to simplify benefits enrollment and administration process
88.8% – the percentage of employers that employ guided decision support, cost calculators, and plan comparison tools
51% – the percentage of employers that aimed to implement more virtual solutions for healthcare and benefits in 2019
47% – the percentage of employers that identified managing employee benefit costs as a priority
More than 50% – the percentage of small businesses that use digital benefits process solutions
64% – the percentage of HR managers that are of the mindset that their companies offer satisfactory/very satisfactory pay and benefit expectations setting when it comes to a job listing
46% – the percentage of employees with plans on using financial applications and online platforms for benefits delivery
34% – the percentage of organizations that implemented benefits offerings
70% – the percentage of employees who prefer human benefits advisors
53.33% – the percentage of employees prefer desktop computers to access benefits portals; 10.96% prefer using their desktop computers at home; 18.62% prefer using laptop computers; 12.54% prefer using mobile gadgets and smartphones
According to organizations, the following are the main factors in evaluating HR technology platforms:
Low cost (23.9%)
Employee empowerment (51.5%)
Ease of use (61.4%)
52% – the percentage of employers that believe virtual care will be important in the future of healthcare delivery
24% – increase in the cost of employee benefits as part of an employee compensation package between 2001 and 2015
77% – the percentage of employers with plans to implement a digital system in managing benefits delivery in a central platform
More than 1 in 10 HR managers (13%) are already seeing evidence of artificial intelligence (AI) becoming a regular part of HR
Employee Recruitment, retention, and Engagement Statistics:
70% – the
percentage of employers with employees that underutilize the services, benefits,and programs that are being offered to them
79% – the percentage of workers that value benefits
According to employees, here are the essential benefits:
- Health insurance (79%)
- Retirement plan (79%)
- Dental insurance (72%)
- Disability insurance (72%)
- Paid time off (71%)
- Life insurance (63%)
- Health savings account (48%)
- Financial wellness (41%)
- Legal services (34%)
Benefits Management Statistics:
56% – the percentage of lower attrition for companies with excellent compensation and benefits packages
137% – the percentage of headcount growth for companies with flexible work arrangements
3 main factors to quitting jobs: lack of career advancement opportunities, low pay, and the absence of a salary pay raise
43% – the percentage of workers that would be willing to leave their companies for a 10% salary increase
72% – the percentage of employees who believe that more work benefits would increase job satisfaction
More than 50% – the percentage of employees that would leave their current jobs for new jobs with better benefits
55% – the percentage of employees that prioritize a more robust benefits package over lower compensation
More than 35% – the percentage of 18-34-year-olds consider compensation as the prime reason for leaving a job
Top reasons for enhancing benefits: retention (72%) and recruiting (58%)
71% – the percentage of employees that would exchange their current jobs for another with flexible schedules
80% – the percentage of employees that consider benefits satisfaction as a top priority
79% – the percentage of employees that deem competitive benefits plan as a deciding factor
36% – the percentage of employers that offer flexible work arrangements for talent retention
23% – the percentage of employers that offer additional recognition programs
58% – the percentage of business leaders who think their benefits related to technology and platforms lead to candidates’ decisions to work for them
83% – the percentage of employers that cite retaining employees as the top benefits enhancement objective
50% – the percentage of adults willing to resign from their current jobs for better employee benefits
Nearly 40% of employees indicated that a wider selection of employee benefits and perks would result in more loyalty to their employer.
Salary and compensation statistics:
64% – the percentage of employees that identify a significant increase in pay or employee benefits as a very important factor in considering a job
29% – the percentage of workers who feel their pay didn’t meet their needs
50% – the percentage of U.S. workers that did not receive a pay boost in some form over the past 12 months
38% – the percentage of employees that received extra compensation for their performance
49% – the percentage of employees who think that they get just compensation
32%-35% – the percentage of employers who allow variable pay for executives and HR managers
26% – the percentage of employers that consider higher healthcare costs as the reason for keeping salary increases in check
Almost 57% of employees would trade any employee benefits offered for a salary increase.
41% – the percentage of employees who think a higher salary would lead to higher job satisfaction
25% – the percentage of workers who consider themselves very well-paid
80% – the percentage of workers that deem money as a major pain point
27% – the percentage of employees who think their current employer does not care about their financial status and wellbeing
Healthcare, retirement, time-off, and wellness employee benefits statistics:
72% – the percentage of organizations that offer a fully insured health plan
82% – percentage of businesses that consider retirement savings as a very important benefit
70% – percentage of employers who think family care benefits are essential
91% – the percentage of organizations that offer mental health coverage
22% – increase in the number of programs that provide support for employees’ wellbeing
67% – the percentage of organizations that facilitate social activities
82% – the percentage of employers who think they provide their workforce with access to mental health resources
70% – percentage of employers with no changes or enhancements to their employee benefits programs
58% – the percentage of organizations that provide wellness programs
51% – the percentage of employers that automatically enroll their employees in their company’s retirement plan
57% – the percentage of employers that provide retirement investment advice
42% – the percentage of employers that automatically enroll their newly hired employees into a contribution retirement savings plan
36% – the percentage of employers that provide non-retirement financial advice
62 – the average age of retirement
26% – the percentage of organizations that offer paid leaves for volunteering
98% – the percentage of organizations that allow paid vacation and medical leave to employees
6% – the percentage of employers who offer unlimited leaves
40% – the percentage of employed Americans who prefer companies that encourage the use of their allotted paid time off
What is the true cost of employee benefits packages?
Employees who value their most important resource, the workforce, know that taking care of the employees is an essential investment, and this entails ensuring that the proper employee benefits are considered and offered to them.
One way to ensure that the employees go above and beyond their duty and responsibilities is to be able to supply and provide for them the compensation and benefits that they deserve. However, fulfilling this need, especially benefits comes with a cost.
A company must review what their employees want in benefits!
This highlights the need to identify and assess what benefits resonate well with the employees, in other words, what provides value and appeasement to the employees. Employers need to design their strategies for benefits administration properly.
According to a recent study by the Bureau of Labor Statistics during the first quarter of 2022, the average cost of benefits per employee for private organizations averaged USD 38.61 per hour, including salary costs. For employee benefits alone, the average cost is $11.42.
For civilian workers, the average cost of benefits plus compensation averaged USD 40.90 per hour; for pure benefits, the average cost is $12.74.
Finally, for state and local government workers, the average cost of benefits per employee for private organizations averaged USD 55.47 per hour, including salary costs and $21.45 for benefits alone.
According to the Bureau of Labor Statistics, total employee benefits costs are comprised of 5 major categories and include 18 costs:
Paid leave – vacation, holiday, sick, and personal leave;
Supplemental pay – overtime and premium, shift differentials, and nonproduction bonuses;
Insurance – life, health, short-term and long-term disability;
Retirement and savings – defined benefit and defined contribution;
Legally required benefits – Social Security [refers to Old-Age, Survivors, and Disability Insurance (OASDI) program], Medicare, federal and state unemployment insurance, and workers’ compensation. For benefits alone, costs averaged $21.45.
What benefits do employees value most?
Based on a study that was done by JustWorks, here are the employee benefits that help attract new hires and retain top talent in an organization.
Regarding employee benefits, 88% of employees consider the options and quality of health benefits as important over other types of benefits. Moreover, 41% of companies include health insurance in their compensation packages. Benefits concerning health and well-being are the most desired and sought-after employee benefits.
But what about mental health?
15% of organizations consider mental and physical health when designing and determining what employee benefits will be included in their packages. In recent years, more awareness and focus have been given to the importance of mental health. And this makes sense, as official studies, along with non-official tests like the anxiety disorder indicator, have shown an uptick in individuals diagnosed with mental health disorders.
Although the figures are still low, the percentage of companies offering perks for their employees’ mental health is on the rise. 26% of job applicants list gym memberships and flexible work arrangements as nice when looking for jobs.
On paid time off, 88% of employees consider vacation leaves and paid time off as necessary. However, in contrast, only 36% of employers offer paid time off. This disparity might be attributed to resources and budget issues, especially for small companies.
Regarding gender statistics, 50% of female employees consider paid time off as important, in contrast to males, where only 25% deem this benefit as necessary.
The top five benefits that are important for employees are:
Health and wellness – 45%
Paid time off and leaves – 38%
Retirement and pension plans – 37%
Extra perks and fringe benefits – 26%
Paid parental leave – 20%
What are the employee benefit trends that are shaping the foreseeable future?
The labor force has undergone many changes in recent years, with the COVID-19 pandemic and the Great Resignation affecting all aspects of our work life and causing unprecedented disruption to businesses with a lot of job offers and positions to fulfill.
One means that has sprung up for employers in retaining employees and attracting recruits is through enhanced and increased benefits offerings. Year after year, the list of benefits that employees consider essential is growing.
Based on a MetLife study, more than half of employees list health and wellness programs as important for jobs that they will consider. This number has increased significantly compared to how it was pre-pandemic.
Remote and flexible work environments focus on employees’ mental health, additional time off, and emphasis on work-life balance are other employee benefits that employees consider when looking for new companies.
What is the ideal cost and price range for benefits administration software per market sector?
Like any other software, the following are the three main factors when considering the apt software for an organization: subscription price per employee per month, implementation fees, and carrier integration fees.
The last one is needed when facilitating integration, exchange of required data, and enrolment processing with third-party systems, insurance carriers, and vendors.
According to the Benefits Administration pricing and buyer’s guide of MyShortlister.com, here is the average cost of purchasing and implementing a stand-alone benefits administration solution:
$3 – $5 per-employee-per-month subscription price
Implementation fee – may range from 5% to 20% of the overall yearly cost
Carrier integration fees
One advantage of using an HRIS platform with built-in employee benefits administration is the opportunity to save up on some of these costs.
Visit our post on The Top Benefits Administration Software to learn more about benefits administration products.
The Wrap
Offering benefits will go a long way in helping organizations ensure that employees will be taken care of and provided with attractive salaries and employee benefits packages.
Utilizing benefits administration software can alleviate the issues of both employers and employees in understanding the benefits being offered and navigating the processes of monitoring and availing them.
Employees and employers who have a clear grasp of the real value of their benefits and all the processes that usage entails can help retain employees, streamlining business processes and keeping all stakeholders satisfied.