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NextGen Magazine

 
 

Survey: Employee Benefits Education Must Go Alongside Investments in Their Well-Being

By:
Karen Sibayan
Published Date:
Sep 23, 2024

iStock-489838442 Benefits

According to Payroll Integrations' 2024 Financial Wellness Report, organizations that prioritize employees' well-being by investing in two areas—financial wellness and benefits education—will be rewarded with financially stable and satisfied staff. 

Participants in the survey comprised 250 full-time U.S. employees and company leaders in charge of payroll and benefits. Payroll Integrations was founded in 2016 with the goal to simplify payroll and benefits management.

In terms of the workforce's financial health, the majority of employees surveyed feel in control of their finances, with 93% saying that they feel at least "somewhat" in control and 54% of those indicating "complete" control. 

However, digging further into the data showed generational differences in terms of money handling. For instance, Gen Z was the least likely to report "complete" control, at 33% of respondents compared to 65% of millennials. Similar results were found between millennials and their two senior generations.  

Still, despite the disparity compared to their older counterparts, 58% of Gen Z reported feeling they were "somewhat" in control of their finances. 

The report said the split is probably due to the generational wealth gap. Even though millennials and Gen Z have experienced an 80% wealth growth in recent years based on New York Federal Reserve data, both these generations are still a cumulative $94 trillion behind baby boomers.

From the employers' point of view, the report said that the disparity highlights the need to invest more in employee well-being so that companies can entice talented and newly skilled employees. 

The report said employees “do not prioritize financial education as much as employers do and—particularly among younger employees—are not as informed on their benefits as they should be." This gap indicates that employer benefits investments and employee awareness campaigns must be coordinated. At the same time, although tech solutions are deployed to provide employee benefits, "too much time is still being spent on benefits management, and employers should seek to improve this," the report said. 

The survey also demonstrated the importance of benefits education as employees' knowledge about them is directly tied to how much they participate. According to the survey, employees who feel more educated regarding their company’s benefits are significantly more likely to participate in them.   

For example, retirement plans saw 52% uninformed to 70% informed participation. The difference is especially stark in more complicated benefits such as retirement plans—15% uninformed to 44% informed. The same goes for financial education and planning with 8% uninformed to 24% informed participants. 

However, this trend is less apparent when it comes to health insurance responses with 59% participation among the uninformed and 66% in the informed. The report said that this was probably due to health insurance being necessary for everyday life. 

The report said the message is clear: Employees who are not just aware of but well-informed about their benefits package will be more likely to participate in them. This makes it incumbent on employers to work proactively to encourage employee involvement. Benefits investments and awareness efforts should go hand in hand. 

Other survey findings show that employees view retirement plans (73%) and health insurance (72%) as the most important benefits by a considerable margin. In fact, most employees said they would only accept a new job offer if retirement plans (67%) and health insurance (65%) were part of the employee benefits package. However, this does not mean that they regard benefits such as life insurance support as not important. 

Investments in employee education might be steep. However, the survey's findings showed that the justifications for investments in employee well-being, even with considerable fiscal challenges, are increasingly apparent given that "one of the most significant challenges in the non-profit, public, and business worlds today is the ongoing labor shortage," the report said.