New research finds organizations are diversifying their programs in order to be talent attractors.
By Debbie Bolla
Organizations are diversifying their benefits programs, including an expansion of mental health and lifestyle offerings, in their efforts to be employers of choice. Savvy HR leaders understand that a competitive program is a game-changer in today’s challenging landscape of high inflation and decreasing unemployment rates.
“Healthcare costs can certainly be a factor in employee decisions,” says Kathy Barber, vice president and head of corporate benefits and compensation of Goldman Sachs Ayco. “Employees look for, and even expect, a diverse benefit platform today. We anticipate a continued focus on cash compensation due to new pay transparency laws.”
Goldman Sachs Ayco’s 2023 Benefits & Compensation Trends in Corporate America Report found that mental health is the most common voluntary and ancillary benefit, with 95% agreeing, an increase from 90% in 2022. This has been an upward trend over the last few years.
“The Pandemic exacerbated an existing issue: People struggling to balance work with family, physical, mental, and financial issues. The pandemic created and enhanced a number of mental health challenges including fear and isolation and added to family struggles around managing childcare and care for elderly family members,” explains Barber. “Employers have risen to meet this challenge by enhancing the support they offer to employees. The uncertain economic environment and increased layoffs have also added to stress and anxiety as families struggle to maintain household finances.”
Barber also points out that younger generations are often more open to discussing mental health issues while expecting more from their employers and the employee experience.
“As Millennials and Gen Z comprise more of the workforce, providing support for these needs has become more essential,” she says. “To remain attractive to these workers, employers must look to provide more flexible alternatives for accessing support. While offering mental health benefits is critical, employers must also ensure their company culture both makes employees feel comfortable admitting they need help and gives them accommodations to use these benefits.”
The report finds that in addition to employee assistance programs, popular mental health benefits include virtual and on-demand services, self-help apps, and community forums to connect on mental health concerns.
In conjunction with mental health support, lifestyle benefit programs may be the next big talent attractor. “An emerging trend that could provide a compelling solution for this is lifestyle spending accounts,” says Barber. “These employer-funded after-tax accounts can offer companies an alternative method of providing financial support to employees. They have the benefit of allowing employees to direct the dollars toward benefits and expenses that are most important to them.”
For example, companies can offer reimbursement accounts for a variety of expenses, including gym memberships, student loan repayment, ID theft protection, tax preparation, and care for loved ones or pets.\
In the long run, a diverse benefits program is a win-win. “From an employer perspective, mental health benefits can help improve employee productivity, reduce sick time, and decrease health insurance costs,” Barber says.