Better. It’s something all manufacturers strive for. Better outcomes from better performance. But how do you get there?
Area Vice President, Health & Welfare Consulting
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Bloomington, MN 55431
Know Your Strengths and Opportunities
Safety challenges are a serious issue in the manufacturing industry as the wellbeing of employees is a major concern for every manufacturing leader. As an employer, you should provide a comprehensive benefits program that is tailored to employees’ needs. This not only engages employees and supports their physical and emotional wellbeing, but also their financial and career wellbeing. Organizational wellbeing, which improves talent attraction and retention in a competitive job market, can also be improved.
Gallagher’s Benefits Strategy & Benchmarking Survey Manufacturing Addendum highlights findings from 505 manufacturers that participated in the research, focusing on employee wellbeing, medical benefits and retirement benefits.
Like stress, wellbeing affects energy levels and overall health. Wellbeing programs can engage employees and boost productivity. Yet more industry employers apply a wellbeing strategy focused on physical health alone (35%) than one that also considers emotional, career and financial aspects (17%). About a third (34%) don’t have any strategy, but 44% of this group plan to put one in place by 2021.
Participation in wellbeing programs is the top challenge for manufacturing employers (62%) — which may be compounded by multiple shifts and shift workers (33%). Greater use of mobile and cloud-based technology and better communication can help reach a broader audience and increase awareness and engagement.
Manufacturers also have an opportunity to increase their support for career wellbeing. Most offer performance reviews (91%) and service awards (75%), but these do little to advance employees’ goals. To that end, some manufacturers are providing development training for management or leadership (63%) and employees (60%). And 1 in 4 (25%) offer mentoring programs, helping retain institutional knowledge and build a collaborative work environment.
Three-quarters of manufacturing employers (75%) agree or strongly agree that medical and pharmacy benefits are key for recruitment and retention. But rising costs continue to tax their bottom line. The top challenges are the high cost of medical services (67%) and unhealthy employees and dependents (47%). Healthcare analytic tools can give employers a better understanding of the unique health risks of their employee populations, which informs better management strategies.
Designing competitive medical benefits for employees involves balancing needs and interests — including the extent of coverage, the employee’s share of financial responsibility, and the sustainability of the organization’s costs. Employers can best accomplish this objective through benchmarking and data-driven decisions.
Plan choice allows employees to select the coverage that best fits their needs. Manufacturers typically offer one (30%) or two plans (33%) — but an increase in providing three or more options (from 26% to 38%) occurred between 2017 and 2019.
Manufacturing employers are also turning to cost-management tactics that can support better care choices and outcomes for patients. Examples include telemedicine (56%), disease management programs (32%), healthcare decision support (30%) and cost-transparency tools (27%). Within two years, the use of these resources is expected to rise.
Currently used by 26%, value-based tactics that incentivize patient disease management are on the rise. An additional 22% plan to implement more options by 2021.
The competition for talent and maturing workforces highlight the importance of evaluating retirement benefits — using data and planning tools to create a longer-term strategy. Most manufacturing employers (85%) offer retirement plans, and their nearly universal choice is a defined contribution plan (97%).
More than half (53%) directly drive financial wellbeing through retirement plan auto-enrollment, and a third (33%) auto-escalate employee contributions. To help increase participation, 88% contribute funds by matching employee contributions, typically at 100%, and capped at an amount that equals 5% of a participant’s salary.
Financial wellbeing has gained traction as a cultural priority for industry employers, increasing for 38% since 2017. Current investments emphasize financial advisor sessions (75%), financial literacy and education (56%), and employee discount programs (54%). Twenty-five percent (25%) also offer debt counseling. This benefit helps employees find their financial footing so they’re better positioned to save for a secure future. And it may serve as a competitive differentiator.
How You Can Improve Your Workplace
Unrelenting competition for talent and ambitious goals for sales and organizational growth are driving manufacturing employers to embrace data-driven benefits design. Today and beyond, the challenges of shifting employee demographics can be met more successfully with technology advances and greater access to richer data. Employers are better positioned to re-examine traditional benefits design and develop more relevant and compelling total rewards.
An opportunity exists to develop strategies that address employees’ total wellbeing, with each program adding value to the benefits package. Through workforce assessment and benchmarking that inform well-targeted initiatives, manufacturing employers can build sustainable benefits that support the present and future financial security of their evolving workforce.
For more information on how Gallagher can help your organization improve the wellbeing of your population and reduce your bottom line, please contact me at firstname.lastname@example.org or 952-356-0742.