Younger generations driving lifestyle benefits
Millennials will make up seventy-five percent of the U.S. workforce by 2025, according to a study by Forbes. The self-confidence of younger generations is pushing companies to adopt more non-traditional benefits. Continue reading to learn more.
Younger generations are often characterized as entitled and demanding — but that self-confidence in their work is pushing companies to adopt benefits outside the traditional healthcare and retirement packages.
By 2025, millennials will make up 75% of the U.S. workforce, according to a study by Forbes. The first wave of Generation Z — millennials’ younger siblings — graduated college and entered the workforce last year. With these younger generations flooding the workplace, benefit advisers need to steer clients toward innovative benefits to attract and retain talent, according to panelists during a lifestyle benefits discussion at Workplace Benefits Renaissance, a broker convention hosted by Employee Benefit Adviser.
“Millennials came into the workforce with a level of entitlement — which is actually a good thing,” said Lindsay Ryan Bailey, founder and CEO of Fitpros, during the panel discussion. “They’re bringing their outside life into the workplace because they value being a well-rounded person.”
Catering benefits to younger generations doesn’t necessarily exclude the older ones, the panelists said, in a discussion led by Employee Benefit Adviser Associate Editor Caroline Hroncich. Older generations are accustomed to receiving traditional benefits, but that doesn’t mean they won’t appreciate new ones introduced by younger generations.
“Baby boomers put their heads down and get stuff done without asking for more — that’s just how they’ve always done things,” Bailey said. “But they see what millennials are getting and are demanding the same.”
In a job market where there are more vacant positions than available talent to fill them, the panelists said it’s important now, more than ever, to advise clients to pursue lifestyle benefits. While a comprehensive medical and retirement package is attractive, benefits that help employees live a more balanced life will attract and retain the best employees, the panelists said.
“Once you’ve taken care of their basic needs, have clients look at [lifestyle benefits],” said Dave Freedman, general manager of group plans at LegalZoom. “These benefits demonstrate to workers that the employer has their back.”
The most attractive lifestyle benefits are wellness centered, the panelists said. Wellness benefits include everything from gym memberships, maternity and paternity leave, flexible hours and experiences like acupuncture and facials. But no matter which program employers decide to offer, if it’s not easily accessible, employees won’t use it, the panel said.
“Traditional gym memberships can be a nightmare with all the paperwork,” said Paul O’Reilly-Hyland, CEO and founder of Zeamo, a digital company connecting users with gym memberships. “[Younger employees] want easy access and choices — they don’t want to be locked into contracts.
Freedman said brokers should suggest clients offer benefits catered to people based on life stages. He says there are four distinct stages: Starting out, planting roots, career growth and retirement. Providing benefits that help entry-level employees pay down student debt, buy their first car or rent their first apartment will give companies access to the best new talent.
To retain older employees, Freedman suggests offering programs to help employees buy their first house, in addition to offering time off to bond with their child when they start having families. The career growth phase is when most divorces happen and kids start going to college, Freedman said. Offering legal and financial planning services can help reduce employee burdens in these situations. And, of course, offering a comprehensive retirement plan is a great incentive for employees to stay with a company, Freedman said.
Clients may balk at the additional costs of implementing lifestyle benefits, but they help safeguard against low employee morale and job turnover. Replacing existing employees can cost companies significant amounts of money, the panelists said.
“Offering these benefits is a soft dollar investment,” Freedman said. “Studies show it helps companies save money, but employers have to be in the mindset that this is the right thing to do.”
SOURCE: Webster, K. (25 February 2019) "Younger generations driving lifestyle benefits" (Web Blog Post). Retrieved from https://www.employeebenefitadviser.com/news/younger-generations-driving-lifestyle-benefits?brief=00000152-1443-d1cc-a5fa-7cfba3c60000
How Retirement Advisers Can Engage Millennials
Originally posted by Mike Nesper on June 16, 2015 on ebn.benefitnews.com.
Workforce demographics are changing as more millennials are entering and the baby boomers are retiring. That path to retirement is also changing — defined benefit plans are a solution of the past, leaving defined contribution plans as the major retirement vehicle.
The problem is millennials aren’t contributing enough to their 401(k) plans. “There is a crisis,” Tim Slavin, senior vice president of defined contribution at Broadridge, said recently between sessions at the SPARK Institute’s national conference in Washington, D.C. “Millennials better hurry up and get in a 401(k).”
So what’s the best way to make that happen?
Make it convenient. “We live in the concierge society,” said Debbie Brown, vice president of marketing at Broadridge.
A good way to disseminate retirement information to millennials is via electronic tools like Dropbox, Slavin said. This way, employees can view statements on their time. Sending alerts in emails doesn’t work well, he said, because if not opened immediately, most people forget about them. “It’s not come to us, but we’re gonna go to you,” he said.
Ensuring tools and communication are easy to understand is key, Brown said. “Keep it simple. Make it work everywhere,” she said.
Millennials want information upfront before having a face-to-face conversation about retirement, Slavin said. “They want to get engaged,” he said, and once they are, millennials commit.
Automatic enrollment is a good tool to increase participation among younger workers, Slavin said. “There’s significant traction there,” he said. “The biggest issue is apathy.” That’s why auto enrollment should be paired with auto escalation, Slavin said.
For millennials, saving for retirement can be difficult — DB plans are no longer supplementing DC plans, wage growth is stagnant and many have student loan debt. Still, achieving retirement goals can be accomplished, Slavin said, but employees need to start contributing to their plan as soon as they enter the workforce.
While younger workers might take some time to realize what’s needed to retire, Slavin is confident they’ll come around. “Millennials are smart,” he said. “They’ll catch on.”
