With employee and job seeker expectations continuing to grow, employers have had to keep up in order to remain relevant in a competitive talent market.
Along with boosting workplace perks like PTO policies and flexible work schedules
, companies have also explored ways to modernize their benefit offerings.
And while healthcare and retirement savings remain a staple of benefit packages, voluntary benefits are growing increasingly more important to both employers and employees.
But what makes these benefits complex for employers is that new trends and worker demands emerge each year, meaning that today’s benefit packages must be continuously monitored and updated.
Trends in Voluntary Benefits
In early 2019, DirectPath and Gartner released the 2019 Medical Trends and Observations Report
, which revealed a wide-range of data on around healthcare benefits. However, it did contain a small section that explored voluntary benefit trends, which is what we will focus on in this blog.
Standard voluntary benefits (dental, vision, short-term disability coverage, and long-term disability coverage) are still the most popular. 75% of employers offer dental and vision, around 66% offer long-term disability, and about 50% offer short-term disability.
Two more popular voluntary benefits offered by employers are auto insurance (28%) and home owners’ insurance (27%).
Another popular voluntary benefit trend in recent years has been pet insurance
, and the survey found that 25% of employers offer this perk. However, many expect this number to continue increasing in the years ahead.
Adoption assistance has been another voluntary benefit that has grown in demand over the last few years, and employers have taken notice – 19% are currently offering this to their employees.
Here are a few other popular voluntary benefits and how they have changed from 2018 to 2019:
- Supplemental life – 75% in 2019; 45% in 2018
- Legal services and assistance programs – 46% in 2019; 37% in 2018
- Critical illness – 26% in 2019; 31% in 2018
- AD&D – 60% in 2019; 27% in 2018
- Identity protection – 25% in 2019; 19% in 2018
These represent some of the trends employers, especially small businesses, should keep in mind when the time comes to review the current benefits offered to employees.
Why Are Employers Offering More Voluntary Benefits Each Year?
The majority of voluntary benefits increase in adoption by employers and usage from employees from year-to-year. And new voluntary benefits emerge each year as well, resulting in additions to even the most modern perks package.
But the main question is why?
The two main reasons both revolve around talent management
– recruiting job seekers to the organization
and retaining current employees
The economic upturn since the end of the Great Recession has resulted in a dramatic shift within the labor market – there are more open positions than there are workers to fill them.
This means that competition for top-talent is at an all-time high, causing employers to alter their strategies for recruiting and retaining workers.
A popular solution has been to modernize benefit and perks packages to accomplish two main results:
- Meet (or exceed) the expectations of today’s job seekers to ultimately attract and hire talent
- Increase employee happiness and engagement to help boost retention
And voluntary benefits are a critical component that helps achieve these key talent management goals.
Small Employers Must Also Add Voluntary Benefits
Years ago, voluntary benefits were often associated only with larger employers who had the means to offer these impressive perks to their workforce.
But as smaller businesses have found solutions to enhance their benefit packages
, these employers have also added valuable voluntary benefits to help compete with large organizations.
With the talent market expected to remain competitive into the future, you can expect employers big and small to continue adding voluntary benefits
and other workplace perks to attract and retain talent.
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