This year marks the 20th anniversary of the Sanofi Canada Healthcare Survey (SCHS). It reflects how 1500 plan members and 461 plan sponsors feel about their health benefits and organizational health issues based on a cross country survey conducted in January 2017.
The SCHS provides valuable benchmark data on the views of survey respondents and can be used to assess plan sponsor and member needs, particularly for those revisiting their benefits plan design or strategic philosophy on benefits.
And the survey says...
The overall theme of this year's survey seems to reflect a slightly downward trend in 3 major categories.
1) Plan member satisfaction with their health benefits plan appears to have dropped. Only 53 per cent of plan members reported that their benefits plan met their needs extremely or very well. This is a big drop from 73 per cent who reported the same in 1999. However, when plan members are satisfied with their jobs, have access to health promotion programs and spending accounts, they are more satisfied then those without these elements.
Perhaps not surprising, non-unionized and private-sector plan members were less satisfied with their health benefits plans than those in unionized and public-sector plans.
Additionally, plan members who are in poor health were less likely to report that their benefits plan met their needs. There was also a growing perception that employers choose cost control over benefit quality. With this perception in mind, plan members feel less obligated to control costs based on the choices they make as healthcare consumers.
2) Fewer employers are making changes to benefits plan design.
Over the next few years, 11 per cent fewer employers are considering making changes to their health benefits plan design. (42 per cent in 2015 compared to 31 per cent in 2017).
Of the 31 per cent anticipating changes to their plan, what are they going to do? Respondents said they would restructure the plan design (39 per cent), introduce new or increased benefits (38 per cent) and finally, introduce or enhance wellness and illness prevention benefits (36 per cent).
3) Health promotion is levelling off.
While there remains significant unmet mental and physical health needs in our country along with an alarming increase in chronic disease conditions, plan sponsors report their appetite for investing in wellness and health prevention is waning. Even though there are significant workplace issues with stress, anxiety, depression and work-life balance concerns, only 31 per cent of employers plan on investing in wellness. This percentage is down from 68 per cent in 2011.
There could be a number of reasons for this levelling off all of which might be specific to the plan sponsors surveyed. Regardless, promotion of a culture of health in the workplace and looking for practical and affordable ways to prevent the prevalence of stress and chronic disease from growing is necessary. Part of our role is to help plan sponsors find ways to make strategic investments in their benefits plans that are sustainable, valuable and drive toward tangible outcomes. For more information on this topic or other ways to effectively manage benefits plan costs, please contact us. We're here to help so that you can focus on what you do best.
A great deal of attention is being paid to Millennials (born between 1980-2000) and for good reason. By the year 2020, they will represent approximately 50% of the North American workforce. Their views toward debt management and saving for retirement are important considerations as they begin to dominate as consumer and workplace influencers.
What about the other demographic cohorts in the workforce?
While Baby Boomers (born between 1946-1965) are still part of the workforce, we see their numbers continuing to decline even though Canada has one of the highest percentages of working age people of all G8 countries at 68.5% (age 15-64), according to Catalyst.org.
While their numbers might not be as plentiful, Baby Busters, also known as part of Generation X - the core of them born between 1966 and 1971, represent 2.8 million people in Canada, according to information provided by Statistics Canada (www.12.statcan.gc.ca).
Economic challenges face each workforce demographic, but GenXers have lived through unprecedented economic transformation with large swings in the job market and, since the elimination of mandatory retirement, need to redefine the timing of their own workforce exit strategy. As a result, Baby Busters don't have the same sense of career and retirement as the generations preceeding them. With the impact of larger economic forces, GenXers developed less confidence in their ability to save for the long-term. With so much vying for their dollars earned (mortgage, loads, credit card debt, emergency funds, child's education savings), other financial needs simply take priority over saving for retirement.
With RRSP season upon us, there tends to be an influx of savings-related surveys published annually by various financial instituations to help assertain savings patterns and consumer behaviour. Recently, TD announced the results of their latest survey, which highlighted that more than two-thirds of Canadians between the ages of 35-54 (Gen X) say they're not saving enough for retirement. It is this cohort that says they really need help meeting their financial goals and they feel guilty about not saving enough.
Don't expect to retire on time.
In addition, 25% say not being ready for retirement is keeping them up at night. Also, the majority of this Baby Buster-GenX cohort report that they don't expect to be able to retire on time and 29% anticipate working in some manner during "retirement."
The TD survey sites savings barriers resulting primarily from GenXers' everyday financial demands such as: living expenses, mortgage or rent, as well as childcare costs (61%). These Baby Busters also said they struggle with paying down exsiting debt (42%) and other major unexpected life events like divorce or death of a spouse (19%).
While Millennials (born between 1980-2000) expressed similar worries to those of the Baby Busters, the Millennials or Generation Y have a longer savings runway with peak income earnings years still upon them even though they may feel that saving for the long-term, given all the economic turbulance, seems somewhat less reasonable.
Mindsets and intrinsic motivation
What does all this survey information mean when communicating the importance of saving for retirement and engaging employees in participatory pension and savings programs? It means that demographics influence an employee's personal finance mindset and their attitude toward savings habits.
If Traditionalists (born before 1946) could advise GenXers, they would likely tell them to spend less than they make because after all, "a penny saved is a penny earned". Even though this historically thrifty cohort enjoyed the opportunity for long careers with one employer, they might tell this generation that spending less might mean cutting back on day-to-day expenses. They might encourage them to find a way to contribute regularly to their retirement savings and share that doing something now is better than feeling overwhelmed and giving up on building a nest-egg. They might also reinforce the need to manage both sides of the balance sheet.
It is the simple wisdom of those who travelled the road ahead who can look back with clarity and offer up insights that are tried and true. This approach also works for workplace communication strategies -- look closely at what intrinsically motivates each generation in order to help them better prepare for their financial future, today.
These topics along with others pertaining to workforce trends and their influence on group benefit and pension programs remains an important area of focus for us. We invite you to contact us with questions. We are here to help so that you can focus on what you do best.
Of the generational cohorts, Millennials - those born between 1980 to 2000 --will make up 50% of the world's workforce by 2020. Where Baby Boomers -- those born between 1946 and 1964 -- drove so much of the decision-making, leaderships and consumer purchasing factors until now, it is clear there is another key influencer taking over this role, the Millennials or Generation Y.
Company HR departments, recruiting firms, ad agencies and just about any business looking to drive market share and hire rising star talent are bringing their attention to answering the questions: "What do Millennials want?" and "What will attract Millennials?"
It is with these questions in mind that I share the high-level summary of a recent project conducted by Bentley University called PreparedU. The infographic featured as the image in this blog reveals what Bentley's PreparedU project found out about Millennials.
1) There are some misconceptions about how they work and think. It has been generalized that they tend to hide behind technology with a preference for communicating via text or phone. The result? 51% of Millennials prefer to communicate face-to-face and in person. Email at 19% and text at 14% came in a distant second and third.
2) Another generalization that may be falsely anchored was that Millennials are not loyal to employers and would likely have a dozen or more jobs throughout their career. The Bentley survey showed that Millennials are more loyal than was assumed with 16% of respondents indicating that they saw themselves staying with one employer for their entire career and 80% of surveyed Millennials believing they would work for 4 or fewer companies throughout their career.
3) What may have been validated through the Bentley survey is the assumption that many Millennials have a poor work ethnic. Millennials agreed with 55% of respondents saying that they are unprepared for their first job and 66% of them said that the workplace should limit their use of social media to help address their ability to get work done and limit these online distractions.
4) How does the normal workday look for Millennials? According to the survey, the traditional concept of working 9 to 5 is over with 77% of respondents sharing they would be more productive if they were allowed flexible work hours.
So how does preparing for the influx of Millennials impact talent and shape benefit plans in the future?
1) Employers are looking to focus on introducing wellness programs that show their commitment to the mind, body and spirit of their employees. There is more of a focus on fitness reimbursement programs that aren't just for gym memberships, but for other cardio-related activities such as rowing clubs, Frisbee and baseball leagues. What is offered in vending machines and cafeterias is also being given closer examination. Living a healthy lifestyle includes the food choices made readily available to employees.
2) Companies are looking to introduce voluntary benefits with pet insurance and there is more interest in coverage for identity theft and other on-line related employee concerns. Employers are also incorporating coverage for naturopathic medicine and mental health counselling,
Providing benefits that the Millennials actually value and find of interest is a key question. As this generation continues to chance the face of the modern workplace, more pressure will be placed on finding answers that suit their preferences. Being prepared for Millennials means developing strategies to address these questions now before being forced to do so later.
To discuss workforce planning and considerations for your benefits and/or pension plan, please contact us. We stay on top of the trends with a practical awareness that comes from over two decades' industry experience. We're here to help so that you can focus on what you do best.
To learn more about this survey and to hear from Millennials on these topics, please watch the YouTube video from the PreparedU site called, "The Millennial Mind Goes to Work."
The results of the 2014 Sanofi Canada Healthcare survey reveal that the generational cohorts do not share the same view toward employee benefits. As mentioned in Part 1 of this blog topic, Generation Y (born 1980-2000) holds more of a sense of entitlement toward benefits. With the exception of health spending accounts, this generation is less likely that other generations to rate each part of their health benefit plan as important.
But what about Boomers (Born 1946-1964) and Generation X (Born 1965-1979)? The survey finds that when these cohorts were asked what options they would consider to enhance their employee benefits plan, the selections turned toward eldercare slightly ahead of personal benefit offerings such as fitness equipment and genetic testing. This response perhaps mirrors what is happening in the Canadian landscape. Many working Canadians are considered part of the "sandwich generation" that is raising children as well as supporting their aging parents and/or relatives.
The 2012 National Study on Work, Life and Caregiving reported that 40% of caregivers admit to overriding feelings of anger and frustration, while 25% are anxious. The Study also found that caregivers were much more likely to miss work.
Aside from the generational issues at play, there is a misperception that employee benefits will continue post retirement. In fact, the survey found that 48% of plan members expect access to their current health benefits while the reality is that only 23% of the plan sponsors offer post-retiree benefits. It is employees working for companies with 1,000 or more employees who are more likely to have this expectation. Employees working for a small businesses generally don't share the belief that they will receive benefits post retirement.
Beyond the size of the organization, regionally, there are differences in the views of plan members. Those working in Ontario are more likely at 52% to expect benefits while Albertans are less likely at 31%. Non-union employees in the private sector have lower expectations at 28% then unionized employees in the public sector at 53%. Not surprising, 83% of plans with unions provide access to existing or separate plans after retirement. In the private sector, this percentage drops to 8%.
So what can be done? One answer that the advisory panel and others consider vital is the need for greater, more engaging communication that happens sooner rather than later. Plan members close to retirement (63%) are more at risk of expecting benefits than employees who are 18-34 years old (42%). Benefits communications should educate about the basics of group insurance coverage as well as provide practical steps that equip the plan member when it comes to making better and more informed choices now and in the future.
Understanding the value of benefits among the different generations as well as dispelling misperceptions about continuation of post-retirement benefits can be a challenging prospect, particularly when a plan sponsor wears many different hats.
We're here to help. Contact us so that you can spend more time focusing on what you do best.
Dave Dickinson, B.Comm, CFP, CLU, CHFC
Experienced Benefits Specialist ready to optimize your group benefits and pension plans.