Survey: Benefits Key for Attracting Top Employees
Originally published November-December 2012
Does your utility offer the right benefits to attract and retain the best employees?
Despite high unemployment rates, companies are reporting challenges in recruiting workers with specific skills such as engineers and technology experience.
According to a 2012 survey by the Society of Human Resource Management (SHRM), more than half the companies in the United States reported difficulty finding skilled workers for specific job openings.
The survey found that organizations in 2011 spent an average of 19 percent of an employee’s annual salary on voluntary benefits such as medical plans and other health care benefits; 18 percent on mandatory benefits such as unemployment compensation and Social Security; and 10 percent on paid leave benefits such as vacations, holidays and sick leave.
Employee benefits play a key role in recruiting and keeping top talent, especially in light of economic pressures that may hold down salaries. The SHRM survey highlighted some of the top benefits that companies offer.
Health insurance—From the survey of 550 companies, 97 percent offered a prescription drug program, the most commonly offered health care and welfare benefit. Of those programs, 91 percent offered a mail-order prescription drug program.
The majority of companies (83 percent) included a preferred provider organization (PPO) plan. Other common options were the health maintenance organization (HMO) offered by 32 percent of organizations and the point of service (POS) plan, offered by 23 percent. Only 8 percent of organizations chose an exclusive provider organization (EPO) that combines aspects of the PPO and an HMO. Finally, fee-for-service or indemity plans were offered by 8 percent of the companies.
In addition, 22 percent of organizations make available health care savings accounts, which differ from flexible spending accounts in that the saved funds roll over from year to year.
The vast majority (96 percent) of companies offer dental insurance and 79 percent offer vision insurance.
Retirement and financial planning—Even though many employees are planning on working longer, the aging work force has focused attention on retirement funding and planning. Among companies in the survey, defined contribution retirement plans were the most common retirement programs with 92 percent of the companies offering such a plan, followed by Roth 401(k) savings plans at 34 percent. Other popular options were traditional defined benefit pensions at 21 percent and cash balance pension plans at 6 percent.
To help employees prepare for retirement, 67 percent of organizations offer some form of investment advice.
In addition to salary or hourly compensation, many companies provide additional benefits to support employees’ financial health. The survey found that 84 percent of companies offer life insurance to employees. In addition, 25 percent made available accident insurance separate from travel accident insurance and 20 percent also offered accelerated death benefits in case of a terminal illness.
Companies also pay compensation in addition to wages. For those employees who have work hours outside the traditional 9-to-5, 38 percent of companies pay shift premiums.
Many companies incorporate performance bonuses for achieving organizational and personal goals into their compensation plans. Half the companies offer performance bonuses to executives, and 41 percent offered it to non-executive employees. In addition, 38 percent offered referral bonuses to employees who refer others to the organization. Also, 59 percent awarded some type of compensation in recognition of service anniversaries.
Family-friendly benefits—These benefits help employees deal with the costs and complexities of family life. One of the most popular programs is the dependent care flexible spending account, with 72 percent of organizations offering this program, which helps employees offset some of the expenses of dependent care.
With many single-parent families or two-parent families in which both parents work outside the home, 32 percent of companies allowed employees to bring children to work in a child care emergency. Other child care benefits were more rare, with only 4 percent of organizations offering access to a nonsubsidized child care center and 4 percent offering access to a subsidized child care program.
To help employees pay for higher education for their children, 14 percent of organizations provided 529 tax-advantaged savings plans.
Many employees are caught in the sandwich generation, taking care of both children and elder family members. However, only 10 percent of companies offered an elder care referral service.
Top 5 Most Common Benefits
Prescription Drug Program Coverage.............97%
Defined Contribution Retirement Plan.............92%
Mail Order Prescription Drug Plan...................91%
Top 5 Least Common Benefits
Prepared Take Home Meals..............................3%
Personal Tax Services.......................................2%
Unlimited Paid Time Off....................................1%
Paid Pet/Child Care During Business Travel.....1%
Access to Back-up Elder Care Services............1%
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David L. Blaylock
Senior Vice President, Publishing
Jeanne Wickline LaBella
Robert Thomas III
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