ITASCA, Ill., March 17, 2016 – Faced with the need to attract and retain a competitive workforce and maintain or decrease overall operating costs, employers are looking for meaningful data to guide their benefit decisions. The Best-in-Class Benchmarking Analysis produced by Arthur J. Gallagher & Co. (Gallagher) looks at how high-performing organizations are addressing these two competing priorities.
“Employers need to find reliable ways to curtail rising healthcare and other benefit costs to set themselves apart as employers of choice in a competitive talent marketplace,” said James W. Durkin, Jr., President of Arthur J. Gallagher & Co.’s Employee Benefits Consulting and Brokerage operation. “An understanding of characteristics that distinguish the best in class within a peer group gives employers relevant insights into how to compete cost effectively for top talent. Gallagher’s Best-in-Class Benchmarking Analysis focuses on identifying an optimal approach, and helps employers both redefine and refine the benefit strategies, tactics and operational execution needed to succeed.”
Containing Healthcare Costs and Improving Health Requires an Active Focus
Compared to their similar-size peers, both midsize (100-999 full-time employees) and large (1,000 + full-time employees) best-in-class employers are more strategic in managing costs when it comes employee health and healthcare. In the midsize group, 38 percent of the best in class have a defined compensation philosophy (vs. 29 percent of peers). This tendency is more pronounced for the large group at 52 percent (vs. 35 percent of peers).
In addition, twice as many best-in-class midsize employers ranked improving employee health as a top-three human resource challenge versus their peers (18 percent vs. 9 percent). The margin was even wider for large organizations (41 percent vs. 16 percent).
Promoting Work-Life Balance, Wellness and Financial Security are Strategic Priorities
The best-in-class tendency to be more strategic was also evident in their approach to managing human resources. Midsize and large employers that have a total rewards or strategic benefits plan with measurable objectives far outnumber their peers. Flexible work schedules are offered by 66 percent of midsize employers (vs. 50 percent of peers), and 68 percent of large employers (vs. 47 percent of peers). Eighty-five percent of midsize employers (vs. 42 percent of peers), and 98 percent of large employers (vs. 61 percent of peers) have wellness programs. And, in promoting employees’ long-term financial security, 59 percent of midsize employers take steps to gauge the retirement readiness of their employees (vs. 29 percent of peers). For large employers, this trend is even more prominent (65 percent vs. 32 percent).