Keeping employees engaged and productive at work is an uphill battle when they’re stressed out by personal finance. Two recent surveys show that HR professionals and employees alike think employee preoccupation with money issues has grown worse in the past 12 months, with damaging consequences.
Employee financial stress is harming productivity at work
In January the Society for Human Resource Management (SHRM) questioned HR professionals about how employee work habits were impacted by personal financial anxiety. Of the negative effects financial stress has on employees, HR professionals cited these as the top problems:
- The ability to focus on work (47%).
- Overall stress levels (46%)
- General productivity (26%)
When we meet with HR professionals, one of the first discussions we have is just how much has happened in the world of communications over the last 5 years. Sure, most of the innovation has occurred out on the consumer web but we have always maintained that it’s only a matter of time before the more mainstream trends make it into the enterprise.
Employee Communications Trends
We obviously think that video is an important consumer trend for employers to embrace in their employee communications strategies. Another consumer trend that you may be tired of hearing about at this point – social networking – is the latest to gain enterprise adoption. There are two companies in this space that have created a sort of Facebook for the enterprise that are growing at impressive rates:
Wellness Programs Call for Better Benefits Communications
Wellness programs are all the rage this year. But what’s the point of a program that employees don’t understand and, therefore, don’t use? Midwest Business Group on Health has done some research evaluating employee engagement in health benefits and wellness programs.
What they found: Employees still do not understand their benefits. Part of the reason why employees are having trouble meeting their wellness goals is a lack of good communication and resources. MBGH found, “Most employees and dependents don’t fully understand what health care benefits are available to them nor do they fully comprehend the summary plan description (SPD) or what requirements they need follow to achieve incentives (i.e. premium differentials) that may be part of the benefit plan design. As a result, communications efforts frequently go unnoticed, are ignored or misunderstood by the employee.”
As the recession forces companies to cut back on spending and get more out of their investments, here’s yet another study from UNUM offering evidence that investing in better benefits communications is sound advice.
Taken in December 2010 following last year’s annual enrollment period, the UNUM study finds that effective benefits education enables employees to make better choices, can increase employee loyalty and improves how employees rate their benefits packages.
They’ve wrapped up their findings in a catchy 3+3 slogan: three weeks plus three types of education methods = a better benefits education. This reflects the findings that apparently half of the employees surveyed had less than three weeks to review their benefits.
Connecting retirement benefits to the health benefit open enrollment period can dramatically increase 401(k) participation, found Bank of America Merrill Lynch. By providing easy “one-click” access to enroll in or make
Drive 401(k) participation by tying to Open Enrollment
contribution changes to 401(k) plans during open enrollment, employers have seen an increase in participation. The study showed an 11% year-over-year increase in the number of employees making a change to their retirement plan election as a result of the association with the health care open enrollment period. And nearly all of these election changes were positive (93%), meaning employees started or increased contributions to a plan.
The on-boarding process is critical to the productivity and retention of new employees. And while on-boarding is defined as the first 90 days of employment, most experts agree that a new hire’s assessment of a new employer
Meaningful New Hire Connections
is formed much, much sooner. In fact, like so many other things in life, your greatest opportunity to build trust and excitement about your organization is likely with the very first impression you make.
So, what’s your organization’s first impression?
Employees seek retirement advice from their employers
A majority of people have agreed they would like more guidance from their employer about how to achieve retirement goals according to the 11th Annual Transamerica Retirement Survey.
Perhaps not surprisingly, employees with a higher overall education level are more likely to be financially well in retirement. Only 63% of employees with only a high school diploma participated in a retirement plan, as opposed to 84% of those with a college degree.
But all education levels showed a desire for direction from their employers.
Once upon a time, the number one priority for benefits programs was to attract, motivate and retain talented employees. That time was 2007. As the economy melted down and layoffs began, retention quickly took a backseat to benefits cost cutting priorities.
Benefits Communications Turn Risk Into Opportunity
As the economy improves, the tide may be turning once again according to several new studies. Here are some key findings:
- Up to 60% of top performing employees plan to leave their organization within the next year
- In October 2010, the number of employees voluntarily quitting their jobs surpassed involuntary terminations
Despite the optimism regarding the economy in 2011, employees are still feeling cautious about their money,
Employees Remain Cautious
according to the Q4:2010 Principal Financial Well-Being Index survey. Here are some of the key takeaways:
- Half of employees did not feel better about their financial situation than they did a year ago. Nearly 40% of employees were still cautious about the economy.
- 72% of employees are concerned about their long-term financial future.
- Health care costs (65%) and economic uncertainty (59%) topped their short-term concerns.
- Living within their means (62%) and having an emergency fund (46%) were employees’ main priorities as they re-build their financial well-being.
Voluntary benefits are ineffective without proper education.
Conceptually, offering voluntary benefits has a lot of attractive qualities for employers. In fact, 65% of employees said their voluntary benefits made them feel more loyal at work. But is simply offering them enough?
Voluntary benefits are ineffective without proper education, according to MetLife’s 2010 research and survey. These are valuable options for employees and employers alike, yet they are shrouded with misconception.
Consider the following statistics found in the recent studies:
- 19% of employees surveyed didn’t even know they received discounts on home and auto insurance through their work.