Mounting business costs reshaping the employee health and wellbeing landscape
Rising operational costs, economic uncertainty, and the ongoing challenges of attracting and retaining talent have compelled businesses across the country to rethink their approach to employee benefits, taking a targeted, cost-effective approach that prioritises value for both employees and employers.
According to research from GRiD, the industry body for the group risk protection sector, 30% of employers cited affordability as the biggest challenge in supporting the health and wellbeing of staff.
But, of those employers who do measure the impact of their employee health and wellbeing support, 42% say it helps them to mitigate the number and length of absences, resulting in quicker returns to work.
Likewise, 98% agree that monitoring the impact of their health and wellbeing support has had a significantly positive impact on their company.
Proactive health initiatives - a strategic investment
Employers are increasingly recognising the significant long-term benefits that investing in the health and wellbeing of their workforce can yield.
Proactive, holistic health strategies focus on prevention and early intervention, helping employees to manage and maintain their issues before they escalate.
This approach not only improves employee wellbeing but also addresses challenges before they become chronic and require time off work, reducing the need for costly health treatment later down the line.
By offering benefits such as regular health screenings, access to remote GPs, or mental health support services, potential health risks can be identified early, so businesses can help employees address any issues proactively, leading to better outcomes for both the individual and the business.
Value-add for group risk products
Group risk products, such as group life insurance, income protection, and critical illness cover, have long been a staple of employee benefit packages.
However, in the current cost-conscious environment, employers are understandably seeking to extract more value from these products by leveraging the associated value-added services, such as employee assistance programmes (EAPs), bereavement counselling, and rehabilitation services.
By integrating these value-added services into their benefit strategies, employers can provide more comprehensive support to their employees at no additional cost.
Interestingly, Unum’s 2023 research with WPI Economics found that employees who have access to a comprehensive range of benefits would, if required, be willing to pay almost £500 per year on average to access them.
In real terms, this means employees would be willing to pay 46% more than the cost of an average annual premium for a group income protection (GIP) policy (most of which provide access to a full range of benefits) - around £335 per insured employee. This demonstrates the value that employees put on health and wellbeing support.
And so, employers willing to offer this support as part of their overall employee compensation packages significantly increase their appeal in the labour market.
Employer-provided cash plans
As companies grapple with the need to offer competitive benefits while managing costs, cash plans have gained popularity because they strike the right balance.
They allow employers to provide tangible health benefits without the high premiums associated with traditional private medical insurance (PMI), and often include additional features, such as access to health screening and mental health support, enhancing their appeal to a modern and diverse workforce.
Focusing finances
Budgeting for health and wellbeing initiatives can be a challenge, with other business concerns taking priority when it comes to assigning funds.
So, employers must work to understand the specific health and wellbeing challenges that are most prevalent within their workforce - such as high levels of stress, financial worries or lack of exercise.
Only then can employers take a preventative approach to wellbeing, targeting finances for maximum impact and making the most of available budget.
A simple workplace survey can be enough for employers to begin to understand employees’ needs, allowing employers to build cost-effective initiatives around specific problem areas, and encouraging healthy behaviours.
As UK employers navigate the pressures of rising costs, they can stand out from the crowd by taking a more targeted and selective approach to benefits, attracting and retaining top talent while maintaining financial stability.
With the emphasis on doing more with less, every benefit offered should deliver tangible value to both employees and the business.
