According to a recent Randstad Employer Brand Research survey, the manufacturing sector had one of the highest rates of turnover with approximately 22 percent of manufacturing workers changing jobs, compared to 18 percent across all other sectors.
Defined Benefit Plans
Defined benefit plans are a type of employer-sponsored retirement plan where employee benefits are calculated using a specified formula. This formula takes many aspects into consideration, such as the employee’s salary history and length of employment.
Similar to a 401(k), an employee cannot usually withdraw funds from a defined benefit plan. Instead, the employee becomes eligible to take the benefit as a lump sum at a certain age or as a lifetime annuity. Pensions are a type of defined benefit plan.
Looking into competitors through benchmarking is another way to compare benefits packages. With a defined benefit plan, the employer is responsible for the planning and investment risk. If the employee named as the primary participant on the plan should die while covered by the defined benefit plan, the surviving spouse of the employee is often entitled to the benefits.
One of the most popular retirement accounts offered by employers is the tax-advantaged 401(k) plan. Under this plan, employees can make contributions to their retirement accounts through automatic payroll withholding.
Employers can choose to match some or all of these contributions up to a certain amount set by the IRS. In 2021, the employee and employer contribution limits are set at $58,000.
There are two main types of 401(k) plans: traditional and Roth. A 401(k) is known as a defined contribution plan and employees are responsible for choosing the investments within their account from the selection offered by their employer. Roth 401(k) accounts combine features from both traditional and Roth IRAs. For 2021, the contribution limit for a Roth 401(k) is $19,500. Employees age 50 or over can contribute an extra $6,500.
Life, Health and Disability
Life, health and disability are three of the most sought-after employee benefits in the manufacturing industry. With life insurance, the family of a covered employee is financially protected if the worker should die unexpectedly. Mortgages, funeral costs and outstanding debts may be covered by the benefits of a life insurance plan.
Health insurance is critical for the long-term well-being of employees. Offering a group health insurance policy can help workers gain access to the medical services they need to maintain good health. There are several types of health insurance plans available, such as fee-for-service policies, health maintenance organizations (HMOs), preferred provider organizations (PPOs) and point-of-service (POS) policies.
In rare cases, an employee may suffer a serious injury or illness that requires a prolonged stay at home or in the hospital. When this happens, disability insurance can help the worker’s family continue to meet their financial obligations. The terms of a disability insurance policy can differ so be sure to carefully review the policy.
Wellness programs are often a welcomed component of an employee benefits package that can improve morale, increase productivity and reduce health insurance costs. A wellness program can take on many forms, but not every solution will make sense for every employee.
Some of the most popular wellness program benefits include fitness classes, disease management, health coaching, flu shots, tobacco cessation, health fairs, free healthy food, health education, on-site clinics, telemedicine, biometric screening, health risk assessment (HRA), gym reimbursement and flexible work schedules.
Other Employee Benefits
Colorado businesses in the manufacturing industry also should consider adding other perks to their employee benefits package. Paid time off, including paid family leave for new parents and caregivers, can be a highly attractive benefit for employees with growing families.
Additionally, consider other convenience-based benefits, such as flexible or remote work options. Educational benefits can be highly advantageous for employees looking to improve their education outside of the workplace. For example, student loan repayment can encourage employees to return to school to enhance their knowledge and skills.
Financial planning resources can help employees become more knowledgeable about their money. Consider coaching or training services pertaining to asset management, debt reduction, home buying and preparing for retirement.
Speak To A Employee Benefits Consulting Firm About Employee Benefits
The manufacturing industry faces many unique challenges when it comes to creating a quality talent pool. Fortunately, the right employee benefits can make a significant difference in attracting and retaining strong employees. For more information about Colorado state employee benefits for the manufacturing industry, contact the experienced employee benefits consulting team at New City Insurance.