Employee Benefits Trends for 2024: What Does the Future of Employee Benefits Look Like?
Employee Benefits • Article
8 min. Read
Last Updated: 01/09/2024
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Table of Contents
- 8 Top Trends in Employee Benefits for 2024
- Offer Your Employees the Benefits They Want in 2024
The new year is an ideal time to evaluate how your business retains and engages employees. Employee benefits trends may help shed light on workers’ needs and how you can drive benefits enrollment decisions to meet those needs. When considering what is trending in employee benefits, many workplaces are still adjusting to a post-pandemic landscape while also addressing the needs of a diverse, multi-generational workforce, which continue to reflect an increased commitment to mental and physical health, flexibility, and work/life balance.
However, employers should take a strategic approach to offering benefits. They must consider attracting and retaining top workers by keeping pace with employee benefit trends. Enhancing benefits offerings, increasing pay, and offering flex scheduling are all potential components of keeping great employees, as noted in the 2023 Paychex Pulse of HR Survey. At the same time, economic uncertainty, rising costs, and inflation will require employers to invest their benefit dollars strategically and understand which offerings employees genuinely want and need.
8 Top Trends in Employee Benefits for 2024
As we move into the new year, employers should familiarize themselves with employee benefits industry trends to guide their decision-making. Reviewing the emerging trends in employee benefits and responding with meaningful action can go a long way to keeping your employees happier, healthier, more productive, and loyal to your business.
- Improving Healthcare Affordability
- Total Health and Well-Being
- Support for Onsite, Hybrid, and Flex Work Environments
- Upskilling, Reskilling, and Professional Development
- Personalized Benefits
- Family-Friendly Benefits
- Retirement, Debt Payoff, and Financial Security Benefits
- Diversity, Equity, and Inclusion
1. Improving Healthcare Affordability
A healthy workforce is the foundation of productivity, creativity, and a positive work culture. Yet the rising cost of healthcare, along with finding time to get treatment during a demanding work schedule, can be an obstacle for employees to seek the care they need. The problem is that care deferred to a later date can mean increased claims down the road. And it’s not just about treating a condition. Access to preventative care is equally important. Employers who actively make health care more affordable and accessible are sending the message that they care about their employees as people.
There are several strategies that employers can use to improve healthcare affordability. In addition to a robust healthcare plan, providing employee health benefit accounts can maximize opportunities for employees to save on their healthcare expenses. Health benefit accounts also offer cost savings to you by helping you reduce your tax bill and controlling healthcare costs today and into the future.
Discover which health benefits account can maximize your health insurance plan while attracting employees, saving you money, and improving productivity.
2. Total Health and Well-Being
These days, employee benefits geared toward health and well-being go well beyond a health insurance plan. Consider that as many as 2 in 5 employees are experiencing some combination of mental health concerns, performance issues, and stress. Findings from the Centers for Disease Control (CDC) link depression to an increased risk for many physical health problems, especially chronic conditions like diabetes, heart disease, and stroke. The CDC also points out that the presence of such conditions can increase the risk of mental illness. It becomes an escalating feedback loop with dire consequences for those caught in it.
The interconnectedness between physical health, mental well-being, and even financial wellness provides an opportunity for employers to offer total health benefits that foster an emotionally, socially, and financially fit workforce. It also makes sense from a hiring and recruiting perspective since 60% of employees recently surveyed by Paychex said that mental health benefits will factor into selecting their next job. This may be particularly true among Generation Z workers, who cited mental health benefits as the top benefit (other than higher pay) that would make them stay at a company long-term, according to a 2022 Paychex survey.
One of the current trends in employee benefits is providing health insurance plans paired with services that encourage healthful behaviors such as good sleep hygiene, regular physical movement, smoking cessation, and addiction treatments. These benefits can go a long way in helping improve an employee’s mental health and empowering them to live a happier, more fulfilling life.
Consider also offering support resources such as employee assistance programs (EAPs), comprehensive biometrics and lifestyle education programs, online resources, behavioral health education programs, and suicide awareness training for managers.
3. Support for Onsite, Hybrid, and Flex Work Environments
While the pandemic shifted many employees to remote work, many employees have now returned to the office either partially or fully. The degree to which you support workers’ full-time return to the office, hybrid setup, or flex schedule may play an important role in your ability to retain employees. For example, consistently enforcing policies for both onsite and offsite employees can help your workforce get on board with these policies. Offering flexible work schedules, job sharing, or abbreviated work hours to onsite employees can also be an attractive benefit.
You may also want to think about ways to improve employees’ physical in-office spaces. The work environment can play an important role in employee well-being and, consequently, overall performance and happiness. A comfortable physical work environment, designated areas for collaborative work, and access to a quiet workspace are just a few ways to help employees remain focused and engaged when they return to the office.
4. Upskilling, Reskilling, and Professional Development
Business leaders increasingly understand the importance employees place on their professional development and ability to grow within an organization. This may be especially true for Gen Z, the only generational group growing within the small business employment sector, which is often looking for ways to take their skills to the next level, according to a 2023 special report from Paychex.
To better meet the needs and expectations of all your employees and remain competitive, reskilling your employees for a new role or upskilling your employees to help them perform better can be especially meaningful. This could include offering learning and development opportunities, job rotations, job expansions, and peer coaching. Employees who feel that their company is interested in their personal growth and development may feel more inclined to stay. Having a clear vision for their professional development can also facilitate a deeper purpose when it comes to working and staying committed to their job.
5. Personalized Benefits
Depending on your workforce, a one-size-fits-all benefits package may not yield the value for your employees that you are hoping to provide. As employees place higher priority on benefits (aside from pay), they will gravitate to those employers who are actively seeking ways to meet their needs. Personalized benefits and digital access to them are one way to give your employees a choice in constructing a customized benefits package. When employees have a seamless experience of picking and customizing benefits according to their needs, it may encourage participation in benefits plans and offer a better return on their benefits investment.
Find out how our employee benefits can help better serve your employees and position your business for success.
An excellent place to start in this area is first understanding what types of benefits employees seek in the company’s offerings. You may want to use employee surveys and a current benefits audit to help shed light on this area. Gathering feedback, making data-driven decisions, and implementing a solid communications plan can all help convey benefits’ value to employees and provide insight into how programs can be used.
What do personalized benefits look like? They could be an array of voluntary benefits, which are goods or services that are either fully or partially paid for by the employee but at a group discounted rate made available by the employer. Examples typically include ancillary benefits outside traditional benefits, such as ID theft protection, accidental injury, critical illness, legal, pet, home, auto, and many more types of insurance. Employers then may provide a monthly or annual expense allowance that employees use to offset their costs for these voluntary benefits. You can even set up a reimbursement plan to help with medical expenses, remote work costs, or other perks that support your employees.
6. Family-Friendly Benefits
Between daycare, healthcare, and enrichment programs, raising a child or caring for an elderly dependent represents a substantial financial burden. Add to this the reality that many parents are working full-time, resulting in employees who are burned out, stressed out, and exhausted. Employers are recognizing that expanding family-friendly benefits beyond what is required by federal law is a significant trend that helps safeguard their employees’ physical and mental health.
Employers can extend family-friendly benefits through paid parental leave, paid adoption leave, and surrogacy benefits. A dependent care flexible spending account (DCFSA) can help ease the burden of daycare or other ancillary care costs. Specialized benefits that support women’s reproductive health, which can range from family planning and high-risk pregnancies to infertility treatment and menopause, are also gaining traction in the employee benefits space.
7. Retirement, Debt Payoff, and Financial Security Benefits
Employee benefits trends that help workers address monetary concerns will continue to be popular in 2024. Financial security, or a lack thereof, certainly contributed to the anxiety many Americans experienced during the pandemic. Since then, inflation rates and ongoing uncertainty around a recession have continued to burden those struggling financially. As a result, prioritizing financial goals to improve financial wellness continues to receive much-needed attention from workers and their employers.
Retirement plans with a company match, student loan and debt repayment programs, and financial wellness resources, such as alternatives to traditional banking and early access to earned wages, can help employees work toward financial security may be attractive for employees, regardless of age or financial situation.
8. Diversity, Equity, and Inclusion (DEI)
While perhaps not a direct benefit in the traditional sense, today’s diverse workforce may naturally gravitate to those organizations that are taking thoughtful actions toward creating an inclusive and equitable work environment. A company that prioritizes DEI initiatives, looks to foster a work environment that feels safe for sharing ideas and expressing creativity, along with a more significant opportunity to gain access to training, mentorship, and upward career growth.
Employers who fail to recognize DEI as one of the trends in employee benefits may risk losing talented new hires who could bring valuable and much-needed alternative perspectives and ideas to the business. The 2023 Paychex Pulse of HR Survey found this true for employees across generations. HR leaders surveyed said they are responding in the following ways:
- To attract Gen Z, companies with 100 to 499 employees say they focus on communicating their commitment to diversity.
- To attract Millennials, businesses with 100 to 499 employees say they focus on communicating pay equity, while those with 500 or more employees say they focus on speaking about their inclusion efforts.
- To attract Gen X, companies with 500 or more employees say they focus on communicating about their inclusion efforts, pay equity, and pay increases.
There are tangible steps you can take within your business to demonstrate your commitment to DEI practices. These might include vetting your recruitment and hiring strategies, providing DEI training classes for management, and providing holidays, benefits, and acknowledgments that support different sexual orientations, religious and cultural backgrounds, and marginalized communities
Offer Your Employees the Benefits They Want in 2024
As employers look for ways to engage and retain employees spanning many generations, a solid and strategic benefits package can be crucial to your business’s success and help set you apart from the competition. Paychex can help you stay on top of new benefit trends, put together an ideal package, and offer a curated, digital experience for employees to find affordable personal, professional, and financial benefit options to fit lifestyle needs. Plus, we provide ongoing, easy-to-use support for you, your employees, and your business.
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