A 2021 report by Gallagher showed how the pandemic heightened the need for fresh ways of safeguarding individual and organizational well-being.
According to Gallagher’s 2021 Workforce Trends Report: Organizational Wellbeing, the pandemic intensified a shift in the needs of employees and leadership, driving more extensive use of human resource technologies and a greater emphasis on well-being. Effective communication with employees also was found to be a critical part of promoting a shared vision and shaping the employee experience.
Gallagher’s well-being report is part of the Workforce Trends Report Series it launched this year to help employers make solid decisions for the health and well-being of their employees and organizations.
It is based on data from the 2021 Benefits Strategy & Benchmarking Survey, collected from nearly 4,000 employers in the U.S. across all industries from December 2020 to March 2021. Other data originates from Gallagher’s HR Technology Survey, drawing on responses from 376 employers from April through May 2021.
With the U.S. facing one of the most complex labor markets in history, Gallagher found employers are looking at their rewards as an important tool to attract and retain talent and maintain a healthy organization.
“The migration to working remotely during the pandemic has changed the way people think, not only about where they want to work but also what is important to them in their life and in their workplace,” said William Ziebell, CEO of Gallagher’s Benefits and HR Consulting Division.
“Millions of Americans are looking for a better job, and that can include increased rewards, better benefits, working from home (and) their professional development. This has forced employers of all kinds to reexamine their employee value proposition, including compensation, culture, engagement, agility and, of course, their benefits. This is a very tough market for employers, and any weakness in their offering can have them chasing their talent out the door or having to overpay to get or to keep their people.”
Lenny Brucato, Michigan area president for Gallagher’s Benefits and HR Consulting Division, shared a few Michigan-specific insights from the report.
As in other parts of the country, more job openings than available workers, employees battling caregiving duties along with their existing workloads, and the growing mental and emotional toll of the pandemic have converged to make this one of the most challenging labor markets in history.
To solve for these variables, Gallagher’s Organizational Wellbeing report examined the ways employers are rewriting total well-being strategies to win the war for talent. The Gallagher study dissected four well-being dimensions, including physical, emotional, financial and career, and learned employers feel there is room for improvement, with fewer than half of Michigan employers (42%) agreeing they have an effective well-being strategy to create or sustain a culture of total well-being within the organization.
Voluntary turnover has been one of the most difficult challenges for employers to overcome. According to a national Gallagher survey, not only are workers leaving for new jobs, nearly one-third of employers (32% nationally) say workers have left the labor market to care for loved ones. As a result, nearly half of Michigan employers (45%) now provide their employees with the ability to telecommute full time, which more than doubled from 2020 (22%). Additionally, 65% of Michigan employers allow employees to have a flexible work schedule, compared to only 54% nationally.
“If you think about the primary industries that drive Michigan, whether it be around manufacturing, whether it’s specific to auto or here in West Michigan, the office furniture industry and those kinds of things, you just don’t associate flexible work schedules or telecommuting with some of those industries, but here we are in Michigan with 65% of employers allowing that,” Brucato said.
While telecommuting and flex time might allow employees to better balance professional and personal duties, the isolation often takes a toll on mental and emotional well-being. This might explain why 70% of Michigan employers are placing a greater emphasis on the social aspect of emotional well-being, Brucato said. Common benefits Michigan employers are using to address these issues include:
- EAP provider programs (95%)
- Wellness committees or champions (57%)
- Classes to promote emotional wellbeing, e.g., behavioral health, mindfulness and stress management (55%)
The Gallagher study also found some Michigan employers are looking to differentiate their offerings by including adoption assistance (13%), on-site meditation rooms (9%) and affinity groups (5%).
The Organizational Wellbeing report found physical well-being continued to be a stable within Michigan employers’ wellness plans, with flu shots (86%), weight management (55%), health risk assessment (54%), physical activity programs (52%) and tobacco cessation programs (50%) among the top components.
The data also show most employers carve out a financial well-being offering, with financial advisers (73%), employee-discount programs (67%) and financial literacy and educational programs (56%) as top benefits.
“There’s a recognition that not many Americans or Michiganders are as well prepared for retirement as you would like to see them be at a particular stage in their career, and I think employers are taking more responsibility for helping bring awareness to their employees about the importance of that, whether it’s things like financial coaching, having adviser sessions available (or) financial literacy programs,” Brucato said.
Overall report takeaways
Overall takeaways from the 2021 Organizational Wellbeing report included the following:
Employers need to holistically support employee well-being: health and safety, financial and caregiving.
- Deploying an employee well-being strategy promotes a stronger work culture, Gallagher said. The survey found most employers do invest in a well-being strategy. They either focus on traditional physical health care options (32%) or take a comprehensive approach to the whole health of their employees (25%). Among those currently without a strategy, 20% still provide some well-being resources to employees. Separately, 48% plan to launch one by 2023.
- All aspects of well-being have become more important to at least one-third of employers. Significantly, an 11-point increase to 64% for the social aspects of emotional well-being, in the past year alone, stands out as a material shift driven largely by pandemic stressors. More ways of promoting emotional well-being include adoption assistance (14%), on-site meditation rooms (13%) and affinity groups (8%).
- Flexibility increasingly is offered to support work-life balance. Up five points from 2020 and accelerated by the pandemic, 56% of employers allow eligible employees to choose a flexible work arrangement. This includes a 23-point jump in full-time telecommuting within the span of one year, now offered by almost half (49%). Similarly, over half (54%) have part-time telecommuting policies, up from 32%.
Organizations are taking a more focused approach to HR tech investment and management as existing tech capabilities are being used more extensively.
- Conflicting priorities changed HR tech investment trends, favoring optimization of current assets. While 23% of employers managed to increase their investment in HR tech to cover pandemic-related needs, most optimized their current tech without making any additional changes (41%). Among the 69% that expect to increase their investments by 2023, the majority plan to spend those funds on technology expansion.
- Greater use of HR technology spotlights the influence of strategies on the employee experience. In 2021, 81% applied HR tech strategies at some level, compared with 79% the year before. The most significant increase occurred among the 23% whose HR tech strategy supports their people strategy, up from 19%. And 16% rely on a comprehensive HR tech strategy that aligns with organizational strategies, up from 15%.
- New HR tech needs and opportunities are emerging. Core administrative functions still center on payroll (90%), benefits administration (79%), and time and attendance (78%) — but pandemic challenges opened the door to more strategically focused applications, such as recruiting (up eight points) and learning management (up five points), as employers struggle to support a remote or hybrid workforce.
Companies need advanced planning and strategic investments in employee communication to point employees toward a shared vision of organizational success, Gallagher said, finding:
- Investments in advanced planning and coordination yield greater communication value. More than 1 in 5 employers have a comprehensive communication strategy (22%), an increase of seven points since 2019. Typically, communication strategies are used for certain programs, such as safety, wellness and benefits enrollment (72%). But a master communication plan, with a delivery calendar broken out by channel, will better manage the flow of communications across programs, Gallagher said.
- Efficient digital tools provide anytime, anywhere access. Hybrid workforce models call for a hybrid approach to employee communications. Though email still dominates at 92%, virtual group meetings are on the rise (46%, up from 22% in 2020). Increasingly, employers also are turning to online portals or enrollment sites (66% vs. 60%), conference calls (30% vs. 22%) and video (21% vs. 12%).
- The right message at the right time builds bonds and positive points of engagement, Gallagher said. Confidence in the ability of their communications to create tangible results or employee behavioral change varies among employers. More than half (56%) take a neutral stand, while 38% decisively agree their communications land as intended.
“Organizational well-being is the balance of having the right talent at the right cost structure. When employees feel good about their physical and emotional, career and financial well-being, they are more likely to be engaged and productive,” Ziebell said.
“Employers often have the right components for an attractive employee value proposition but fail to organize and effectively communicate what they have to offer. Now, more than ever before, employers need to take a strategic approach to promoting the well-being of their workforce, leveraging HR technology and employee communications to address today’s volatile talent market and successfully attract and retain employees.”