In a rapidly evolving world of work, marked by disruptions ranging from economic uncertainties, geopolitical conflicts, changing weather patterns and rapid AI advancements, Amol Mhatre presented on the future of benefits at Reward & Employee Benefits Association's (REBA) Future Forum in November 2023.
This article is a summary of the key points from the presentation or you can watch the full recording The future of benefits: More things change, the more they remain the same.
The confluence of disruptions, new ways of working such as remote and flexible work models that, coupled with automation, present both opportunities and challenges.
Labor market shifts, characterized by technology, and talent shortages and skills imbalances, have created more choices for some but may also exacerbate inequities. Social media has replaced water-cooler conversations with amplified voices that demand employer attention.
For employees, rising living costs, financial insecurities and job uncertainties loom large. Flexible work models, while providing choices may lead to physical, mental and social health challenges. Regulatory focus on transparency and equity will affect employee expectations and influence attitudes towards work, pay and benefits.
Our annual Global Priorities for Employee Benefits survey suggests that benefits can no longer be a neutral element of workforce strategy. They can be a crucial factor in attraction and retention (security, retirement and health benefits occupy top positions in employee priorities) and competitive differentiation.
There is of course a correlation between employee wellbeing and resilience, and employees’ performance, productivity, engagement and health. Benefits and wellbeing programs, along with pay and career development, must align to build workforce resilience comprehensively.
Increasingly companies want their benefits to signal their corporate values and employee value proposition. This means we will see companies instituting minimum standards for benefits and leave policies, inclusive and flexible benefits offerings, work flexibility, and focus on equitable pay, careers and inclusive and diverse benefits.
Economic and business uncertainties while labor markets remain tight means cost of benefits must be managed. Organizations can no longer justify millions of benefits spend without listening to what their consumers – in this case employees – want and value, without knowing the trade-offs employees are willing to make to optimize the spend.
With the rising wages and costs of occupational healthcare driven by utilization, costs of treatment and stress on social programs in many countries, companies will have to spend their money on benefits that build workforce resilience and what their employees need and value.
What can employers do to make room to spend money on what matters?
What actions should employers take to help employees get the most of their benefits and improve physical, financial, mental and social health of employees without throwing money at the problem?
Looking towards the future, there will be a convergence of strategic and operational orientations in benefits management. Better business alignment and enhanced employee experiences will be enabled by a data and technology-driven infrastructure. Automation, technology and outsourcing will streamline transactional elements, allowing organizations to allocate resources strategically.
The future of employee benefits revolves around creating business value, managing costs effectively and embracing technological advancements. As the world of work continues to evolve, organizations need to do more to make benefits matter.
