COVID-19 has caused the employee benefits needs of the post-pandemic workforce to change substantially. A survey of U.S. adults by the Pew Research Center found that 71 percent of employees were working from home as of October 2020 and 54 percent expressed that they would like to continue working from home after the coronavirus outbreak ends.
Along with changes in social environments, the benefits that employees receive as part of their benefits package have noticeably improved. Many employers now recognize the importance of offering greater medical coverage, more paid time off, and access to voluntary benefits like life insurance and disability income.
In 2022, employers can anticipate a drive towards enhanced employee benefits offerings. Employee priorities are evolving, and modern businesses must keep pace or risk losing workers to their competitors. Here are some of the top trends in employee benefits that employers can expect to see in the coming year.
1. Healthcare Costs Will Continue Rising
Healthcare costs are expected to increase 6.5 percent in 2022, according to PricewaterhouseCoopers (PWC), just slightly less than the 7 percent increase in 2021. There are several causes for this ongoing cost increase, including greater utilization of healthcare benefits by consumers who deferred care during the pandemic.
Many healthcare providers have also invested in new technologies to support telehealth services, which has led to a sharp increase. Employers that choose to provide more extensive medical and wellness benefits can gain a competitive edge and retain a healthier workforce.
2. There Will Be A Greater Need For Mental Health Services
The pandemic has exacerbated many mental health conditions and sparked new anxiety and depression in employees who were once mentally stable. However, COVID-19 has also created new opportunities for workers to be open about their struggles.
Employers can support their staff by advocating resources and creating a safe, healthy work culture where employees feel comfortable asking for help. In 2022, more employees are expected to seek mental health benefits, such as access to counselors and extensive therapy sessions, which will become part of standard benefits packages.
3. Increased Flexibility And Remote Work Will Become The Norm
Flexible work environments are not just a preference in a post-pandemic business world, but a necessity. Even with vaccination numbers continuing to climb, the U.S. is still experiencing an average of nearly 80,000 new cases a day as of mid-November 2021, according to the New York Times.
The ability to work from home helps keep employees safe and slows the spread of the virus. In 2022, employers can expect an increased number of employees to demand more flexible schedules that include remote work opportunities when possible.
4. Greater Focus Will Be Placed on Retirement Savings
If the pandemic has taught us anything, it is that financial security is of the utmost importance. Approximately 1 in 4 Americans have no retirement savings at all, according to a PWC Retirement in America report. The report also found that the median retirement account balance for retirees aged 55 to 64 is just $120,000.
Over 15 years, this would produce a distribution of less than $1,000 per month. There is an essential need for greater retirement savings options for employees which will become increasingly apparent in 2022 as more job seekers look for careers that offer financial benefits.
5. Employers Are Experimenting With Unlimited PTO
According to the Bureau of Labor Statistics (BLS), ten days is the average amount of paid time off (PTO) for private-sector employees who have been with the company for at least one year. However, many employers are taking a new approach to PTO known as “unlimited PTO.” Unlimited PTO plans are structured to enable employees to decide how and when to use PTO.
This practice has led to greater employee trust, boosts in recruitment and retention, and no end-of-year PTO rush. Of course, the concept of unlimited PTO does have some flaws, such as difficult implementation and abuse of the policy.
6. Companies Will Relax Paid Leave Policies
Since the start of the pandemic, many paid leave policies have received a complete overhaul. The American Families Plan (AFP), implemented by the Biden Administration, has aided in the transition to more expansive medical, parental, and family leave programs.
Paid parental leave is already being offered by 61 percent of respondents, compared to 41 percent in 2018, according to a 2021 Survey on Absence and Disability Management by Mercer. Legislation being debated in Congress could also give workers up to 12 weeks of paid family and medical leave.
Speak With An Experienced Employee Benefits Consulting Firm
Changes will be coming to the employment landscape in 2022. Employees are looking for more financial options, a wider variety of voluntary benefits, and medical coverage that extends beyond that found in traditional health plans. To schedule a consultation with our experienced employee benefits consulting firm, contact New City Insurance today.