Offering new benefits or upgrading existing ones can be a cost-effective way to improve employee satisfaction, talent acquisition, workforce retention, and company reputation. Whether it’s benefits and perks that improve your employees’ financial wellness or forms of insurance that provide peace of mind throughout the entire employee lifecycle, these and other benefits can determine whether a talented potential (or existing) employee decides to be a long-term contributor to your organization.
In this article, we’ll explore the benefits that are likely to be on the rise in 2023 and why your business should consider offering some or all of these benefits to your employees.
Benefits to Support Financial Wellness
Inflation has raised the cost of living for most Americans and increased daily costs in tandem. As a result, more and more businesses are offering benefits that improve financial wellness for their employees, especially as global inflation is expected to rise throughout 2023.
One of the fastest growing employee benefits is student loan repayment assistance. Nearly 75% of employees from a recent survey expressed that they would leave their current position for a job that offered them assistance with student loan repayment. Fortunately for employers, the 2020 CARES Act grants businesses the opportunity to make tax-exempt contributions of up to $5,250 per employee towards student loan repayment until the end of 2025.
Financial coaching and counseling services are also being offered by some employers as a benefit to employees, including for those with student loan debt. These services can also provide employees with professional advice on budgeting, investing, debt repayment, and developing responsible spending habits.
Matching 401(k) and other matching contribution retirement plans continue to grow as a popular and sought-after benefit for job seekers in 2023. 401(k) matching plans are especially attractive since they are tax-deferred, allowing contributions to be withdrawn before calculating state and federal income taxes.
Flexible spending and health savings accounts are two other financial benefits employers will continue to offer in 2023, especially for the pre-tax benefits to employees. An FSA allows employees to use pre-tax dollars on a range of health care and dependent care costs, or even for certain transportation, parking, or commuting costs.
The Decline of Parental Leave Benefits
Although more financial wellness benefits are being offered by many companies to support employees in a more challenging economic climate, more companies are also reducing PTO benefits for new parents and families. This is due in part to a decline in acute COVID-era challenges when work configurations (remote, hybrid, etc.) were still in flux, the need for adult/senior caregiving was concurrently on the rise, and public health circumstances rendered increased maternity and paternity leave a more pressing necessity. Between 2020 and 2022, the number of companies offering maternity and paternity leave beyond the legal minimum declined by nearly 20% in both categories. Nevertheless, paid parental leave remains a contentious issue across the country, particularly as many other countries currently offer uniform (and extensive) paid parental leave policies. This is an area to watch for potential legislative changes in 2023-2024. Employers should also bear in mind that benefits related to building families (fertility, surrogacy, adoption, etc.) are on the rise and should be reviewed for suitability within company benefits packages.
Life Insurance, Accident Insurance, and Other Voluntary Benefits
In keeping with a desire to support employees throughout the full span of their employment, more employers are offering a wide range of voluntary insurance benefits to employees.
Accident insurance, hospital indemnity insurance, and critical illness insurance all offer employees protection in the event of an unexpected medical emergency or to cover health costs as a result of an accident that is uncovered by traditional medical insurance. Similarly, disability insurance – whether short- or long-term – sustains all or a large portion of an employee’s normal salary in the event of an accident or illness that compromises their ability to work.
As for unique voluntary benefits that are on the rise, identity theft protection is an increasingly common benefit companies are offering. This protection provides regular identity theft monitoring, reimburses an employee for any lost funds resulting from identity theft, and assists with remediation in the event that an incident of identity theft occurs.
Finally, life insurance, which provides compensation to designated beneficiaries in the event of an employee’s death is another employee benefit that is growing in popularity, especially as it represents an employer’s investment in the ongoing wellbeing of an employee’s family and loved ones.
Design and Offer an Attractive Benefits Plan with Payday
Choosing benefits that keep your employees satisfied and engaged while remaining cost effective and competitive in the broader hiring market can be a difficult balancing act. That’s why Payday works closely with you to identify benefit plans that fit your organization’s unique profile. We offer a comprehensive benefits solution that helps your organization distinguish itself in the hiring market while ensuring seamless integration with the rest of your Payday services, whether its payroll, time & attendance, HR, or otherwise.
Ready to provide benefits that attract top talent, retain high-performing employees, and boost your company reputation? Contact us today to start our collaboration.