A new survey offers a snapshot into workers’ perception of employee benefits across income levels, finding that both high- and low-wage earners admit benefits are vital to their health and financial security.
For example, 52% of survey participants "felt confident that benefits offered to them at work would protect their financial well-being."
When asked to rate (on a scale of 1 to 5) different benefits in terms of providing financial protection, 85% rated health insurance a 5; while 69% rated retirement saving a 5. The number increased, however, to 80% as workers age and incomes rose.
A similar jump occurred with life insurance with 48% of respondents rated life insurance a 5, increasing to 67% among workers making less than $35,000.
With disability insurance, 39% of workers rated long-term disability a 5, jumping to 52% among workers making less than $35,000, and 35% rated short-term disability a 5, which rose to 45% among workers making less than $35,000.
"Frequently when these programs are offered, there is a notion that gets put out there as conventional wisdom, that certain employee benefits programs are mainly valued and benefited by the highest-paid population," said Dallas Salisbury, president and CEO of Employee Benefit Research Institute, during a recent symposium on the current state of employee benefits and insurance in the United States.
"Yet in this survey, we found consistently, as with life insurance, the population of those rating a program a 5 was much higher among those at the bottom end of the income scale," he added.
Officials at the Financial Services Roundtable and Employee Benefit Research Institute commissioned the Opinion Research Corporation (ORC) to conduct the telephone survey to gauge the public mood toward workplace benefits and insurance products.
The survey was completed during Sept. 10-13, 2010. It represents a national probability sample of 1,007 adults comprising 501 men and 506 women 18 years and older, living in private households in the United States, according to ORC.
The findings may surprise some employers and others who had only perceived employee benefits within the context of job retention and attraction and building employee loyalty. Employees, however, realize with health care reform, the high employment scenario and slow economic growth that their workplace benefits can serve as financial protection.
Still, some have argued that corporate America should replace the employment-based benefits system with a pure individual-choice system, which would be better, given that workers no longer value employee benefits, Salisbury said.
However, "we know from our data that the power of payroll deduction, employer involvement and communication, and financial institutions working with employers does in fact make a difference in workers enrolling in benefits programs."
Overall, 94% of workers said that their employer offers benefits, with 79% admitting they were familiar with all of the insurance and retirement benefits offered by their employer.
Furthermore, 36% of employees have taken a job because of the benefits and insurance an employer offered; 40% have stayed in a job because of the benefits and insurance an employer offered; and 10% left a job because of the benefits and insurance an employer offered.
"If one thinks of anything that restricts workforce mobility as definitionally bad, then these numbers could be viewed as a negative. However in an ever-changing labor market, the ability to attract and retain talent underlines the value of the programs," Salisbury said.
The survey results also reveal why some workers haven’t enrolled in their company’s benefits programs or purchased insurance products through the workplace. For example, 32% said they are getting the offerings outside of the workplace; 23% received a better offer elsewhere; 19% could not afford the offerings; 9% intended to, but haven’t gotten around to it yet; and 5% didn’t understand what their employer was offering or how to sign up for it.
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