Changes to the Affordable Care Act, a proliferation of paidleave laws and the evolution of private exchanges were just a fewof the headlines keeping benefits professionals on their toes in2016. Add to the mix the regulatory uncertainty that comes with anew U.S. administration taking the helm and 2017 promises to beanother interesting year. Here are a few benefits trends toconsider as we embark on the New Year.

1. Think of benefits as a talent magnet.

 

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As an estimated 10,000 baby boomers are retiring every day and asmaller number of Generation X workers are entering the workforceto fill open positions, the market for skilled workers continues totighten. With this in mind, companies looking for a competitivehiring advantage are using benefits as a lever to attract andretain talent.

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According to MetLife, 57 percent of employees would stay withtheir employer if their benefits improved. Further, 78 percent ofworkers say the benefits package is crucial to their decision toaccept or reject a job.

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How well (or poorly) you market your benefits can define howyour employment brand is perceived, and sends a message about yourentire corporate culture. For example, many of us have heard aboutcertain companies that offer unlimited parental leave or generoustuition assistance programs. As employee expectations grow,employers have a huge opportunity to cultivate a benefits packagethat works for everyone and then market those benefits to enticetop talent.

2. Forget the “one-size-fits-all” benefits model. It'sall about “mass personalization.”

 

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No two smartphones look the same once users start adding appsand organizing them to their personal preferences. The same is truefor benefits. Allowing employees to purchase an array of benefitsthat they can tailor to their unique lifestyle creates a higherdegree of engagement.

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To do this, employers need to provide benefits options that arecustomized to a multi-generational workforce. According to the 2016ADP Employee Engagement Study, younger workers tend to seekeducation-related perks and paid maternity/paternity leave, whileboomers are more interested in employee discount and wellnessprograms. It's important to take these kinds of preferences intoconsideration to ensure employees feel recognized and valued.

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Further, some companies are now using Big Data and analytics topersonalize benefits choices towards “people like you,” incategories such as early career, newlyweds, new parents, and thoseexploring retirement. For example, the data may highlight howrecent college graduates favor allocations of benefits to studentloan repayments over health care or life insurance.

3. Health and wealth: The expanding definition ofbenefits and wellness.

 

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Benefits will continue to expand beyond health care toincorporate lifestyle or non-insurance perks like gym memberships,cell phone plans and year-round career training. More companies arenow offering benefits like identity theft insurance, pet insurance,tuition assistance, elder care, adoption assistance, and studentloan repayment.

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The definition of wellness is also expanding to include a focuson financial wellness. According to PwC's “2016 Employee FinancialWellness Survey,” financial stress rose in 2016, with 52 percent ofemployees worrying about their finances.

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Further, 79 percent of millennials said their student loans hada moderate or significant impact on their ability to meet otherfinancial goals, and 43 percent of all employees predicted they'dhave to use money from their retirement plans for non-retirementexpenses.

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As employees are tasked with taking more control of theirretirement savings, employers are starting to talk more about“health and wealth.” How do employees stay healthy in the momentand plan for the future beyond their 401(k) plan? Employers realizethat education and financial wellness programs are needed to helpworkers feel more confident about saving, investing, planning forretirement and managing debt. They also recognize that employeeswho have a sound financial footing have lower absentee rates.

4. More self-service and increasingtransparency.

 

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The “consumerism” movement is evolving. Employees increasinglywant to take control of their benefits. They want and expect theirbenefits to work like any online shopping experience. They expectflexible self-service options that they can access via their mobilephones and tablets so they can easily make their benefits decisionsanywhere, like at their kitchen table with input from theirfamily.

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Forget paper forms and in-person enrollment meetings. They wanta one-stop shop where they can make all their decisions from dentalto disability insurance online. As the range and types of benefitofferings increase, employees will be able to pay their cellphonebills, auto insurance and home loans online as part of theirbenefits plan and see how those deductions directly impact theirpaycheck. This adds up to greater choices, more simplicity andincreased transparency.

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Employees are also expecting increased transparency when itcomes to tackling rising health care costs. They want decisionsupport based on detailed cost algorithms that help them understandtheir true out of pocket costs based on plans, doctors orfacilities selected.

5. Paid leave benefits pick up.

 

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The popularity of paid leave is rising and will continue to gaintraction in the coming year. We've seen new paid leave laws poppingup lately at the state, federal and even local levels, and morelarge companies have been extending paid leave policies to includeeverything from adoption benefits to infertility treatments.

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This trend is expected to continue as the number of dual-earnerfamilies rises, married couples increasingly share childcareresponsibilities, and more Gen Xers tackle caring for their ownchildren as well as aging parents. Watch out for talk about theUnited States moving to six weeks of guaranteed paid maternityleave by amending federal unemployment insurance laws. This couldbe a game changer and is definitely something to keep on your radaras the new administration begins its term.

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A word to the wise: If you're not offering a mix of benefitsthat enhances your employee engagement strategy, you're running therisk of employees leaving for a company that does. Innovativeemployers are doing everything they can to transform benefits intoa business asset. Forget cookie cutter plans focused primarily onhealth care. The future of benefits lies in masspersonalization—benefits offerings that keep every generationengaged and help differentiate your business as a place that valuesbenefits as an asset that attracts and retains top talent.

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