5 tips for getting the best value from benefits when inflation is high
While the rate of CPI inflation fell to 7.9% in June compared with 8.7% in May, prices are still rising at almost four times the Bank of England’s 2% target.
Just as this squeezes consumer finances, many businesses are also feeling the pinch — particularly after record growth in employee wages. Between March and May 2023, employee pay grew by 7.3%, matching the record increase for February to April.
As a result, employers anticipate cost as a top challenge for benefit budgets in the next two years. Almost half (46%) say they’re concerned about the persistence of higher inflation, higher than the 36% who expect a negative impact from a wider weakening of the economy and current business environment.
Here are five tips to help employers get the best value from their benefit packages during a time of high inflation.
1. Health and wellbeing services
According to Unum’s research with Censuswide, financial worries are hitting both employees’ physical and mental health. As a result, 40% of employees report low energy, 32% can’t sleep and 25% are so worried about their finances they’re feeling depressed.
Many group risk providers offer access to digital health and wellbeing services such as remote GPs, physiotherapy and mental health support.
With the NHS under strain, long waiting lists for mental health support or physiotherapy might mean people in pain or distress see no option but to pay privately — not easy as prices rise rapidly. Most health and wellbeing services come at no additional cost to employees, which is why they’re valued so highly.
2. Engaging with rehab services
Most group income protection providers offer vocational rehabilitation and absence management to support an unwell employee while they’re off work to return them to health and work at their own pace. This type of support can ease difficulties caused by absent staff, such as business disruption, reduced productivity or the cost of temporary cover.
When employers refer their employees to rehabilitation services early, it can make a big difference to the likelihood of an employee returning to work, reducing costs for the employer but also, potentially, time spent on reduced sick pay for the employee.
3. Employee assistance programme
A comprehensive Employee assistance programme (EAP) provides a confidential, 24/7 helpline, plus tools and resources for managing physical, emotional and financial wellbeing — to an employee and their immediate family.
Unum’s EAP also provides support with everyday living costs, offering discounts and savings at a range of high street names to help reduce the cost of buying essentials and, therefore, the financial burden on employees.
4. Insights and data
It’s important for both health and wellbeing services and EAPs to offer employers in-depth insights into employee use of these services. This can monitor the workforce and allow employers to spot and manage potential risks sooner.
Use and engagement data also means employers can better understand the ROI of benefits and added-value services. With corporate budgets squeezed, it’s essential employers know just how much employees benefit from their employer’s investment in the workforce.
5. Training managers
Fewer than two in five (38%) HR professionals say managers within their organisation are confident in having sensitive discussions and signposting employees towards expert help.
Employers offering a comprehensive benefits package will reap the value in a happier, healthier and engaged workforce. With benefits that employees value particularly highly in today’s inflationary environment, employers can embed a culture of care in their company and find it easier to attract and retain staff.
