More employees are willing to sacrifice pay for better retirement and health care benefits, reflecting an increasing desire for security.
Additionally, a new survey from Willis Towers Watson finds half of employees would rather receive more substantial benefits (37%) and time off (13%) than additional pay or bonuses.
Fully two-thirds of respondents are willing to pay a higher amount each month for more comprehensive retirement benefits. That’s up from 55% in 2011.
More than four in 10 workers would sacrifice additional pay each month for a more expansive health benefit plan, a sharp increase from 27% in 2013.
“For the vast majority of employees, benefits indeed matter,” Steve Nyce, senior economist with Willis Towers Watson, said in a statement. “Employees of all ages want more security and getting benefits through their employer is an important way to obtain it. They also want choice and personalization and are looking to their employers to provide tools to ensure they make good decisions on issues that are often quite complex.”
Other highlights from the survey include:
Resources lacking for many employees
Only 40% of employees feel the resources their employer provides to support their health and wellbeing meet their needs. Even fewer (32%) say the resources to help manage their finances meet their needs. Interestingly, while 70% of all employees surveyed say their health care benefits meet their needs, that figure drops to 56% among respondents who are in poor physical and mental health.
Employees want meaningful choice
Nearly two-thirds of employees (64%) prefer a moderate number of benefit choices, an indication that they are happy to choose their benefits but having too many options can be confusing. Only two in 10 (20%) favor a large number of options from which to choose.
New entrants to the workforce favor pay over benefits
Half (50%) of Generation Z employees ranked more pay as their highest priority, compared with 35% who ranked more generous benefits as a top priority. Only 15% were more interested in additional time off.
Voluntary benefit preferences vary by age
Nearly half of respondents (46%) would be interested in purchasing home and automobile insurance if offered by their employer, followed by long-term care insurance (36%). Baby boomers are most interested in long-term care insurance compared with millennials (46% versus 28%) while millennials favor auto and home insurance (52%) more than baby boomers do (35%).
With more than 20 years serving financial markets, John Sullivan is the former editor-in-chief of Investment Advisor magazine and retirement editor of ThinkAdvisor.com. Sullivan is also the former editor of Boomer Market Advisor and Bank Advisor magazines, and has a background in the insurance and investment industries in addition to his journalism roots.
