In the midst of rising costs, there’s an ever-growing pressure to manage business budgets and maximise return-on-investment. This issue is compounded by a fierce competition for the best talent, evolving employee expectations, macro challenges and consumer disruption. It’s a tough ask for HR to deliver more, often on restricted – or heavily rationalised – budgets.
In a competitive business landscape, companies are constantly seeking innovative ways to attract and retain top talent. Although salary and career growth opportunities remain significant factors, the spotlight is increasingly turning towards comprehensive employee benefits packages. The return on investment (ROI) for employee benefits is not just measured in financial terms but also in increased uptake, improved employee wellbeing, reduced absence, and increased productivity.
Employee benefits have come a long way from being merely an added perk to becoming a crucial component of a company’s strategic vision. In the past, benefits were often limited to healthcare and pension contributions. However, as the workforce evolves, so do the expectations around what constitutes a competitive benefits package. Today, employees value a holistic approach to wellbeing, encompassing physical, mental, and financial health.
The ‘Bottom Line’ ROI of Employee Wellbeing
Investing in employee benefits yields various returns that extend far beyond the immediate cost. A happier and healthier workforce translates into increased productivity, reduced turnover, and improved employee engagement. Studies consistently show that companies with strong employee benefits programs experience higher job satisfaction, leading to a more committed and motivated workforce.
A comprehensive benefits package can also contribute to a positive company culture. Employees who feel valued and supported are more likely to go above and beyond their job responsibilities, fostering a collaborative and innovative environment. In turn, this positive culture becomes a powerful tool for attracting top talent and retaining existing high-performing employees. Employees are increasingly seeking employers who proactively prioritise their wellbeing; 24% want more support with their own mental health, and 29% want more support with their own physical health.
The ’Risk Mitigation’ ROI of Employee Benefits
On the flip side, neglecting employee wellbeing can have severe consequences for both employees and the organisation. High-stress levels, burnout, and dissatisfaction can lead to increased turnover, negatively impacting morale, and reduced productivity.
An investment in improving employee health can also play a pivotal role in managing absenteeism and controlling future health claims and insured benefit costs. Preventative health programs, such as wellness initiatives and regular health check-ups, can identify and address potential health issues before they escalate. By promoting healthy lifestyles and providing resources for early detection and intervention, companies can significantly reduce the frequency and duration of employee absences – and potentially even the severity of serious illness. This is particularly relevant in relation to spiralling Private Medical costs where prevention is key to sustainability of the scheme.
If you already have a robust benefits package in place, it is still possible that you could maximise your investment – with just a few tweaks. The use of voluntary benefits is a great example of where companies can broaden the benefits options available for their employees, without a full-scale investment from their HR budget. It also gives employees choice and autonomy over their benefits selections – which is something 66% of employees have said they would prefer. It is vital that each demographic feels they are represented in terms of benefits relevant to them and their circumstances.
The return on investment in employee benefits goes beyond numbers on a spreadsheet. A well-crafted benefits package contributes to a positive company culture, improves employee satisfaction, and boosts productivity. Investing in comprehensive benefits packages is not just a smart financial decision; it is an essential strategy for building a resilient, high-performing workforce that drives long-term success.
