In Tough Job Market, Benefits Increasingly Help Employers Attract, Retain Employees

With the labor market remaining tight, the importance of health and retirement benefits in attracting and retaining workers has risen to its highest level in a decade. Furthermore, after a brief dip during the pandemic, the number of employees willing to pay for more generous benefits has increased. These are some of the key findings of a WTW, a leading global advisory, broking, and solutions firm, survey of over 9,600 U.S. employees.

Source: WTW | Published on April 19, 2022

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According to the survey, six out of ten employees (60%) cite their employers' retirement benefits as a major reason they stay with their current employer, up from 41 percent in 2010. Nearly half (47%) said their company's retirement programs (47%) and healthcare benefits (48%) were important reasons they joined their employers, up from 25% and 32%, respectively, in 2010.

According to the survey, more employees are willing to have more money deducted from their paychecks in exchange for better benefits. Almost six out of ten employees (59%) said they would pay more for a larger, more generous retirement benefit, up from 54 percent in 2020. Nearly half of employees (46%) would forego more pay for a more generous healthcare plan, up from 36% in 2020. From 2019 to 2020, the number of workers willing to pay more for both benefits decreased.

"While pay remains the most compelling reason for employees to stay or leave a company, health and retirement benefits have become a much more significant factor in their decision-making process," said Monica Martin, WTW's senior director of retirement. "In this tight labor market, organizations that understand the importance of these core benefits to employees and provide highly valued benefit programs can differentiate themselves in their effort to become an employer of choice."

In an analysis of employee benefit priorities, the survey discovered that retirement (44 percent) is the most important benefit that employees want their employers to focus on, followed by flexible work (39 percent ). Nearly two-thirds (62 percent) of those who want their employers to focus on retirement want a guaranteed retirement benefit, while more than half (58 percent) want more generous retirement benefits and 53 percent want retiree medical benefits.

Among employees who rated flexible work as an important benefit for employers to prioritize, half (50%) want more generous paid time off and sick leave, 47 percent want work from anywhere/remote work options, and 45 percent want the ability to choose when they work.

Managing employee health emerged as an important issue for one-third of those polled (33 percent ). Half (46%) want a more generous healthcare plan, 42 percent want health screenings and risk assessments to help them manage their health, and 37 percent want a more generous dental plan.

Help managing one's emotional health is another benefit option that employees want, with a quarter (27 percent) ranking it as a top priority. More than half (53%) of those polled wanted mental health days to manage their emotional health, two-fifths (40%) want stress and resilience management support programs, and 39% want more generous coverage of mental health services and medication.

"Employees are increasingly turning to their employer for additional assistance and support with their benefits." In turn, employers who want to stay competitive should regularly reevaluate their health and retirement benefit packages in terms of value and flexibility in order to meet the changing needs of their diverse workforces," said Julie Stone, managing director, Health and Benefits, WTW.

About the Survey

The 2022 Global Benefits Attitudes Survey was carried out between December 2021 and January 2022. There were 9,658 respondents from large and midsize private employers in the United States, representing a wide range of industries.