Talent Strategies Highlight Pathways to Profitability and Growth
Dec 05, 2017, 12:10 ET
A new survey of Canadian employers by Gallagher identifies cost control, absence management and employee communication as top opportunities for competitive gain
TORONTO, Dec. 5, 2017 /CNW/ -- Competition for talent continues to be a strong factor affecting the financial and growth prospects for many organizations in Canada. A record 58 percent of Canadian employers planned to increase hiring in 2017i, and that demand for talent is likely to be sustained in 2018 based on a 2.1 percent economic growth forecastii.
If employers want to stand out in today's talent marketplace where employees have more hiring options, they need to strategize how to position themselves as one of their best possible choices. The importance of defining a path to an integrated, holistic and proactive approach to benefits and compensation is a key theme of the first 2017 Canada Benefits Strategy & Benchmarking Survey from Arthur J. Gallagher & Co. (Gallagher). Findings show that cost control, absence management and benefits flexibility are top priorities for employers and employees. In addition to absence management, the survey provides data and insights on employee engagement, communication, medical and prescription drug benefits, life insurance, and dental and retirement benefits.
"As Canadian employers implement business strategies in 2018, their overall relationship with their employees, and in particular, how effectively they engage their workforce is critical to achieving sustainable success," said Leslie A. Lemenager, Regional President–International of Gallagher's employee benefits operation. "Nearly two-thirds of survey participants have a strategy to improve employee engagement. This shows their commitment to cultivating not only a workplace that attracts people who are a good fit, but also a work experience that productively engages and retains them."
Innovative Strategies and Tactics Help Employers Manage Prescription and Paramedical Costs
Employers are searching for ways to counter the increasing costs of prescription drugs and specialty medicines without shifting the burden to employees. Sixty-one percent have implemented mandatory generic policies while 38 percent are considering a dispensing fee maximum. To help manage paramedical costs, 11 percent use a combined annual maximum for all specialists and 30 percent set a per-visit maximum.
Some employers (22 percent) are pairing traditional benefits with a healthcare spending account. This tactic may help keep benefits affordable and allows employee customization. Employers that offer flexible benefits (11 percent) give their employees the opportunity to choose health and dental coverage levels.
Leave Policies Play a Role in Employee Attraction and Retention
Absence management is a top employee-benefits related challenge (36 percent). Formalizing policies for leaves, disability benefits and paid time off (PTO), and communicating clearly on what is available to employees helps ensure fairness and mitigates compliance risk. For most employers PTO consists of 10 to 12 holidays and 2 to 3 weeks of paid vacation at hire. Fifty-six percent offer a short-term disability program and 70 percent of these employers pay the premium costs. Among the 94 percent that provide long-term disability, the employee pays the premium at two-thirds.
Effective Communication is a Top Challenge but Few Employers Take a Comprehensive Approach
Although employers tend to agree that employee communication is important, just 10 percent have invested in a broad-based, integrated strategy. Most employers use a communication strategy for some but not all of their programs (64 percent). Key communication goals focus on educating employees, improving their benefits use and cultivating appreciation for compensation and benefits value. Yet, most employees infrequently receive education about their benefits plan — less than once every two years (60 percent) or once a year (22 percent).
Survey Shows Importance of Taking a 360-Degree View
The 2017 Canada Benefits Strategy & Benchmarking Survey underscores the importance of taking a 360-degree view of an organization's benefits and compensation strategy. It highlights the core challenges of cost management, absence management and benefits flexibility constrained by near-term reactive planning and siloed communications. With a deeper understanding of how total rewards strategies and programs work together, it enables employers to more fully address employee wellbeing and human capital talent needs while controlling costs and mitigating risk.
ABOUT THE BENEFITS STRATEGY & BENCHMARKING SURVEY
Gallagher developed the Benefits Strategy & Benchmarking Survey to provide employers with insights into how their peers are addressing benefit and human capital challenges. The 2017 survey, conducted from April to August of this year, aggregates responses from 374 organizations across Canada. Additional survey results can be found at www.ajg.com/cnbs2017.
Gallagher (NYSE: AJG) is an international insurance brokerage and risk management services firm headquartered in Rolling Meadows, Illinois. The company has operations in 34 countries and offers client-service capabilities in more than 150 countries around the world through a network of correspondent brokers and consultants.
Anna Rozenich, Gallagher
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