As the U.S. moves out from the worst stages of the coronavirus pandemic, businesses are looking at another open enrollment season that’s likely to be one for the record books. The short story: Amid continued economic uncertainty, lingering employee stress, and an anticipated tsunami of turnover, employers are doing a challenging balancing act. One foot is still holding ground in the unique year and a half behind us. The other is trying to get grounded in the coming year — where their decisions for employee benefits will land.
Here’s why that’s true:
- Last year’s enrollment season, which came at the height of the COVID-19 restrictions and upheaval, saw very small, if any, changes in the cost or design of core benefit plans (medical, dental, and vision). But many companies expanded ancillary (“voluntary”) benefits to support employee wellbeing.
- Heading into this year’s annual enrollment season (for most U.S. employers open enrollment is in November), employers are wondering which lessons learned in the past year — and what changes they made to benefits — they’ll carry forward and translate into permanent changes.
Amid all that, one thing is certain: For employers to attract and retain the best people going forward, they’ll need to continue the pandemic-influenced awareness of much broader support for employee wellbeing, and they need to build that recognition permanently into their company culture. Some companies have already started moving down that path.
Companies are spending an average this year of $6 million for wellbeing programs, up roughly 20% from 2020, according to the 12th Annual Employer-sponsored Health & Wellbeing Survey from Fidelity and The Business Group on Health. For companies with more than 20,000 employees, the average budget is $10.5 million, the survey found. Over the next three to five years, 74% of employers plan to expand wellbeing programs, the report says.
Those numbers are striking, for sure. But their real value is revealed when you see where the increased spending is going — and where ancillary benefits could play a big role in the upcoming enrollment season:
- 80% of companies indicate that diversity, equity, and inclusion (DE&I) are now influencing the design of their wellbeing programs. Among those companies, nearly half (45%) have initiatives specifically designed to support traditionally marginalized employees.
- A whopping 92% of employers have expanded their support for mental health and emotional wellbeing in the last year — programs focused on stress management, sleep improvement, and resiliency, as well as pediatric-focused mental health programs.
- 74% have increased work-life balance programs, including 69% who have implemented new leave options and expanded leave benefits during the COVID-19 pandemic.
“As employers around the globe continue to ramp up their wellbeing offerings, we will see a healthier and more engaged workforce,” Ellen Kelsay, president and CEO of Business Group on Health, says in her organization’s report. “In addition, we expect businesses to continue to demonstrate flexibility and support employee needs through leave, hybrid work, and other benefits.”
According to the 2021 State of Mental Health in the Workplace Report from Paychex, employees at smaller workplaces plan to prioritize wellbeing support when they look for their next job:
- 66% reported feeling better about their employer after using a wellbeing benefit
- 60% of employees said that mental health benefits will factor into the selection of their next job
Again, some companies have gotten the message. A Mercer Global survey earlier this year found that 32% of employers are expanding virtual or telehealth programs. One in four said they were enhancing mental health support for employees. Over 16% are adding or expanding voluntary benefits. One clear upshot, Mercer concluded, is that Employee Assistance Programs (EAPs) are likely to increase this year and going forward.
HR leaders who want to act strategically to keep their top performers and be a recognized employer of choice as the job market heats up will bear all of this in mind as they design their benefits packages for 2022 and beyond — and they will pay special attention to programs that support employees’ total wellbeing and are accessible and personalized for all employees.