A new study by BHN (Blackhawk Network) Extras, unveils a critical call for HR decision-makers to take action. Revealed today, the study exposes a concerning situation of increasing number of employees struggling to make ends meet. Many are grappling with persistent costs-of-living increases which is evident of the uptake of employee benefits making them a key in talent retention…
Shockingly, a quarter of individuals (25%) confess to having to spread payments to cover childcare essentials like diapers and formula. What’s more, 15% express that if they had additional disposable income, they would put this towards these necessities.
Huge increasing reliance on employee benefits
Further analysis paints a clear picture: a staggering 56% of employees now rely on workplace benefits to purchase essential items — a 31% surge from the previous year. Despite tentative signs of inflation easing, the pervasive spectre of financial unease looms. A staggering 76% of employees express apprehension about their financial futures, admitting they are worried about their finances in the coming year, with Millennials spearheading the distress at a staggering 80%.
In the face of on-going economic challenges, this study serves as a loud and clear call for HR leaders to hear the concerns of their workforce and take decisive action to alleviate financial strain.
Employee benefits a key to talent retention, yet employers not acting on it
Amidst the swirling currents of financial uncertainty, the study uncovers a troubling reality. As high as 45% of employers fear losing talent to competitors, yet merely a third (33%) are actively taking steps to prevent it. Surprisingly, the data suggests that this isn’t due to a lack of understanding the employee retention strategies. A significant 40% of employers believe that providing additional financial support could stop employees leaving their organisations. A good 57% of employees take action in finding out more and have sought financial coaching or education in the past six months, independent of their benefits package.
Employee benefits need tailored solutions
This disconnect raises a poignant query: why do only 16% of employers offer financial coaching or education, especially when nearly one-fifth (19%) of employees crave more comprehensive financial guidance from their employer? It underscores a glaring gap between employee concerns and the solutions preferred by employers for retention.
Furthermore, the research delineates striking generational disparities in attitudes toward benefits provision. Younger cohorts, namely Gen Z and Millennials, are significantly more frustrated with current offerings (74% and 69%) compared to older generations (Baby Boomers, 39%, and Gen X, 55%).
These revelations underscore the imperative for benefits packages to be tailored to the individual needs of employees, ensuring that schemes yield the intended impact. But the research findings suggest that individuals are still struggling to make ends meet. This could be just the bare minimum for the majority of employees.
Paying a fair salary is no longer enough
Chris Ronald, VP – Incentives, Rewards & Benefits, BHN stated that: “The war for talent continues, and our research uncovers a blind spot for employers. While nearly half fear losing staff to competitors, a surprising number aren’t actively addressing the top concern for employees – financial security. It’s a paradox. We see a laser focus on work-life balance, which is important, but it seems employers are missing the bigger picture. Employers are relieved to see a slow down in the rate of wage increases but they are not off the hook. Paying a ‘fair’ salary is not enough. Employees are stressed about affording basic necessities, and offering alternative options for financial support could be a game-changer.
Younger generations, especially, are frustrated with current benefit packages. This presents a tremendous opportunity. By offering targeted financial wellness programs like discounts on groceries, household furnishings and technology, or even financial coaching – resources demonstrably used by younger generations – companies can bridge this gap and secure a loyal, engaged workforce.
Financial security is a powerful motivator, and employers who prioritise it will be well-positioned to attract and retain top talent.”
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