2015 strategic benefits—leveraging benefits to retain employees

October 15, 2015

SHRM Survey Findings: 2015 Strategic Benefits—Leveraging Benefits to Retain Employees

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IntroductionThe 2015 Strategic Benefits Survey is part of a survey series administered annually since 2012 by the Society for Human Resource Management (SHRM). This research is used to determine whether various employee benefits are leveraged to recruit and retain top talent. The six-part series features the following topics:

Part 1: Wellness Initiatives Part 2: Flexible Work Arrangements Part 3: Health Care Part 4: Leveraging Benefits to Retain Employees Part 5: Leveraging Benefits to Recruit Employees Part 6: Assessment and Communication of Benefits

DefinitionsFor the purpose of this survey, a high-performing employee was defined as any employee ranked among the top 10% in an organization’s last performance review; a highly skilled employee was defined as any employee with skills that are critical to the short- and long-term success of his or her operating unit or organization.

2015 Strategic Benefits Survey—Leveraging Benefits to Retain Employees ©SHRM 2015

Introduction and Definitions

Employees at All Levels of the Organization• Difficulty retaining employees at all levels: More than one-third (36%) of HR

professionals indicated their organizations had difficulty retaining employees at all levels of the organization in the past 12 months, a statistically significant increase from 2013 (26%) and 2012 (25%).

• Leveraging benefits to retain employees at all levels of the organization: One-third (33%) of HR professionals indicated their organizations leveraged their benefits program to retain employees at all levels of the organization in the past 12 months, a statistically significant increase from 2013 (18%) and 2012 (20%).

• Benefits leveraged to retain employees at all levels of the organization: Four-fifths of respondents reported their organizations leveraged health care benefits to retain employees at all levels of the organization; more than one-half reported the same for retirement savings and planning benefits (57%), and slightly fewer for leave (47%) and financial and compensation (46%) benefits.

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Key Findings


High-Performing Employees• Difficulty retaining high-performing employees: Thirty percent of respondents

indicated their organizations had difficulty retaining high-performing employees in the past 12 months.

• Leveraging benefits to retain high-performing employees: One-third (33%) of respondents indicated their organizations leveraged their benefits program to retain high-performing employees in the past 12 months, a statistically significant increase from 2013 (19%) and 2012 (20%).

• Benefits leveraged to retain high-performing employees: More than two-thirds (71%) of respondents indicated their organizations leveraged health care benefits to retain high-performing employees in the past 12 months; about one-half indicated their organizations leveraged retirement savings and planning (51%) and financial and compensation (49%) benefits. Fewer respondents indicated their organizations positively leveraged flexible working benefits in the past 12 months (29%) compared with 2013 (57%) and 2012 (48%).

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Key Findings (continued)


Highly Skilled Employees• Difficulty retaining highly skilled employees: About one-third (35%) of respondents

indicated their organizations had difficulty retaining highly skilled employees in the past 12 months.

• Leveraging benefits to retain highly skilled employees: One-third (33%) of respondents indicated their organizations leveraged their benefits program to retain highly skilled employees in the past 12 months, a statistically significant increase from 2013 (20%) and 2012 (19%).

• Benefits leveraged to retain highly skilled employees: About three-quarters (73%) of respondents reported their organizations leveraged health care benefits to retain highly skilled employees. About one-half indicated their organizations leveraged financial and compensation (52%) and retirement savings and planning (51%) benefits. About one-third (34%) of respondents indicated their organizations leveraged flexible working benefits, a statistically significant decrease from 2013 (55%).

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Key Findings (continued)


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What Do These Findings Mean for the HR Profession?

2015 Strategic Benefits Survey—Leveraging Benefits to Recruit Employees ©SHRM 2015

• More than one-third of HR professionals reported having difficulty retaining employees at all levels of their organizations. In this period of limited wage growth, it is frequently not an option to offer higher salaries as a means of retaining top talent. Knowing this, the use of benefits as a retention strategy should be considered by HR professionals who are struggling to retain employees.

• Fewer HR professionals said their organizations leveraged flexible work arrangements (FWAs) in 2015 as a retention strategy for high-performing employees, compared with previous years. However, FWAs should not be dismissed as a means of retaining workers. These benefits have proven to be highly valued among two sizable demographic groups—Millennials and workers age 55 and older. Millennials have shown an increased preference for having greater control over their own schedules, and many place greater emphasis on organizational culture, rather than on compensation-related aspects of a job. The 55-and-older segment is frequently relied on for filling highly skilled positions, and these employees often need flexibility in scheduling, whether to care for family members or to conduct a phased retirement from the workplace, among other reasons.

• When choosing which benefits to leverage for retention, HR professionals should first point to health care, and retirement savings and planning benefits. These offerings are cited most often by HR professionals in retentions strategies, undoubtedly due to the increasing cost of health care and the fact that extensive research has shown that many workers are not confident that they will have adequate financial resources when they reach retirement age.

2015 Strategic Benefits Survey—Leveraging Benefits to Retain Employees ©SHRM 2015 7

Key Findings

Leveraging Benefits to Retain Employees

36%

32%

26%

25%2012 (n = 389, 379)2013 (n = 349, 335)2014 (n = 302, 295)2015 (n = 343, 313)

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What do these findings mean for the HR profession?


Comparison of Difficulty Retaining and Leveraging of Benefits to Retain Employees at All Levels of the Organization in the Past 12 Months

33%

25%

18%

20%

1, 2 1, 2

Note: Response options provided were “yes/no/not sure.” Respondents who indicated they were “not sure” were excluded from this analysis. Only “yes” responses are shown. 1Statistically significant difference from 2013. 2Statistically significant difference from 2012.

Organizations That Leveraged Their Benefits Program to Retain Employees at All Levels of the Organization in the

Past 12 Months

Organizations That Reported Difficulty Retaining Employees at All Levels of the

Organization in the Past 12 Months

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Benefits Positively Leveraged to Retain Employees at All Levels of the Organization


Health care benefits

Retirement savings and planning benefits

Leave benefits

Financial and compensation benefits*

Professional and career development benefits

80%

57%

47%

41%

74%

62%

51%

46%

45%

68%

57%

37%

40%

72%

58%

37%

39%

2012 (n = 74)2013 (n = 60)2014 (n = 73)

Preventive health and wellness benefits

Flexible working benefits

Family-friendly benefits

Housing and relocation benefits

38%

31%

24%

9%

42%

42%

25%

14%

27%

43%

38%

15%

30%

35%

27%

20%

Note: Respondents whose organizations leveraged their benefits to retain employees at all levels of the organization were asked this question. Respondents who answered “not sure” were excluded from this analysis.*New item on the Strategic Benefits Survey.

Preventive health and wellness

benefits

2015

201320142015

201320142015

201320142015

201320142015

0.53

0.610.57

0.53

0.570.510.55

0.670.67

0.59

0.670.580.65

0.46

0.370.41

0.45

0.430.490.44

0.330.33

0.4

0.330.40.35

0.01

0.020.010.02

00

0.01

00

0.01

00.01

0

10


Change in Importance of Benefits in the Next Three to Five Years to Retain Employees at All Levels of the Organization


Housing and relocation

benefits

Leave benefits


Professional and career development

benefits

Flexible working benefitsHealth care benefits

Retirement savings and planning

benefits

201320142015

201320142015

201320142015

201320142015

9%7%13%

55%41%

20%

33%35%35%

57%54%

48%

64%70%

74%

45%59%

75%

67%65%64%

39%46%

49%

27%24%

13%

0%0%

5%

0%0%1%

4%0%2%

Increase in importanceRemain the sameDecrease in importance

Financial and compensation

benefits*

Note: 2015 n = 77-98; 2014 n = 46-72; 2013 n = 44-58. Respondents whose organizations leveraged their benefits to retain employees at all levels of the organization were asked this question. Respondents who answered “not sure” were excluded from this analysis. Percentages may not total 100% due to rounding. 1Statistically significant difference from 2014. 2Statistically significant difference from 2013. *New item on the Strategic Benefits Survey.

1,2 1,2

30%

28%

26%

23%2012 (n = 386, 370)2013 (n = 350, 336)2014 (n = 299, 293)2015 (n = 343, 314)


33%

24%

19%

20%

Comparison of Difficulty Retaining and Leveraging of Benefits to Retain High-Performing Employees in the Past 12 Months


1, 2

Organizations That Leveraged Their Benefits Program to Retain High-

Performing Employees in the Past 12 Months

Organizations That Reported Difficulty Retaining High-Performing Employees in

the Past 12 Months

12

What do these findings mean for the HR profession?Benefits Positively Leveraged to Retain High-Performing Employees





Leave benefits


71%

51%

40%

35%

60%

54%

49%

49%

52%

63%

63%

38%

49%

58%

47%

29%

55%

2012 (n = 73)2013 (n = 63)2014 (n = 67)





31%

29%

20%

13%

31%

40%

22%

13%

27%

57%

37%

22%

26%

48%

27%

21%

1, 2

Note: Respondents whose organizations leveraged their benefits to retain high-performing employees were asked this question. Respondents who answered “not sure” were excluded from this analysis.*New item on the Strategic Benefits Survey. 1Statistically significant difference from 2013. 2Statistically significant difference from 2012.


benefits

201320142015

201320142015

2015

201320142015

201320142015

64%59%56%

61%62%59%

61%

72%62%66%

61%51%

68%

32%41%

42%

38%38%

39%

36%

28%37%33%

38%48%

32%

3%0%2%

2%0%2%

3%

0%2%1%

2%1%0%

13


Change in Importance of Benefits in the Next Three to Five Years to Retain High-Performing Employees



benefits

Leave benefits



benefits




benefits

201320142015

201320142015

201320142015

201320142015

58%47%

22%

13%19%26%

42%42%

36%

52%48%51%

40%53%

68%

67%60%

57%

56%57%63%

45%52%48%

2%0%

10%

20%21%18%

2%2%1%

3%0%1%



benefits*

Note: 2015 n = 74-95; 2014 n = 47-67; 2013 n = 45-61. Respondents whose organizations leveraged their benefits to retain high-performing employees were asked this question. Respondents who answered “not sure” were excluded from this analysis. Percentages may not total 100% due to rounding. 1Statistically significant difference from 2014. 2Statistically significant difference from 2013. *New item on the Strategic Benefits Survey.

1,2 2

35%

35%

28%

27%2012 (n = 389, 371)2013 (n = 348, 335)2014 (n = 296, 294)2015 (n = 339, 313)


33%

26%

20%

19%

Comparison of Difficulty Retaining and Leveraging of Benefits to Retain Highly Skilled Employees in the Past 12 Months

1, 2


Organizations That Leveraged Their Benefits Program to Retain Highly Skilled Employees in the Past 12

Months

Organizations That Reported Difficulty Retaining Highly Skilled Employees in

the Past 12 Months

15

What do these findings mean for the HR profession?Benefits Positively Leveraged to Retain Highly Skilled Employees





Leave benefits


0.73

0.51

0.38

0.35

70%

52%

46%

53%

41%

0.63

0.59

0.38

0.55

0.69

0.46

0.31

0.54

2012 (n = 71)2013 (n = 64)2014 (n = 70)





34%

32%

22%

13%

53%

37%

27%

13%

55%

28%

41%

19%

44%

27%

35%

11%

1

Note: Respondents whose organizations leveraged their benefits to retain highly skilled employees were asked this question. Respondents who answered “not sure” were excluded from this analysis.*New item on the Strategic Benefits Survey. 1Statistically significant difference from 2013.


benefits

201320142015

201320142015

201320142015

2015

201320142015

64%62%

51%

55%58%57%

64%59%59%

63%

60%59%

69%

31%35%

49%

40%41%42%

36%40%41%

36%

38%41%

31%

5%3%0%

5%2%1%

0%1%0%

1%

2%0%0%

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Change in Importance of Benefits in the Next Three to Five Years to Retain Highly Skilled Employees



benefits

Leave benefits



benefits




benefits

201320142015

201320142015

201320142015

201320142015

11%16%

29%

42%35%43%

66%44%

26%

53%50%50%

71%57%

61%

58%63%56%

34%53%

70%

45%50%50%

18%27%

10%

0%1%1%

0%3%5%

2%0%0%



benefits*

Note: 2015 n = 77-96; 2014 n = 49-70; 2013 n = 45-61. Respondents whose organizations leveraged their benefits to retain high-performing employees were asked this question. Respondents who answered “not sure” were excluded from this analysis. Percentages may not total 100% due to rounding. 1Statistically significant difference from 2013. *New item on the Strategic Benefits Survey.

1 1

2015 Strategic Benefits Survey—Leveraging Benefits to Retain Employees ©SHRM 2015 17

Key Findings

Demographics

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Note: n = 361. Percentages do not total 100% due to multiple response options.

Percentage

Manufacturing 23%Health care and social assistance 16%Professional, scientific and technical services 12%Finance and insurance 10%Government agencies 8%Educational services 7%Transportation and warehousing 6%Retail trade 6%Construction 5%Utilities 4%Mining, quarrying, and oil and gas extraction 4%

Demographics: Organization Industry


19

Key FinDemographics: Organization Industry (continued)

Note: n = 361. Percentages do not total 100% due to multiple response options.

Percentage

Wholesale trade 4%Administrative and support, and waste management and remediation services 4%Real estate and rental and leasing 3%Accommodation and food services 3%Religious, grant-making, civic, professional and similar organizations 3%Arts, entertainment and recreation 2%Repair and maintenance 2%Information 2%Agriculture, forestry, fishing and hunting 1%Personal and laundry services 0%Other industry 11%


20

Key FinDemographics: Organization Sector

Privately owned for-profit

Nonprofit

Publicly owned for-profit

Government

Other

57%

18%

13%

9%

3%

n = 355


21

Key FinDemographics: Organization Staff Size

n = 343


1 to 99 employees

100 to 499 employees

500 to 2,499 employees

2,500 to 24,999 employees

25,000 or more employees

30%

35%

21%

10%

4%

22

Key FinDemographics: Other


n = 359

U.S.-based operations only 77%

Multinational operations 23%

Does your organization have U.S.-based operations (business units) only, or does it operate multinationally?

n = 360

n = 226

n = 226

Single-unit organization: An organization in which the location and the organization are one and the same.

38%

Multi-unit organization: An organization that has more than one location. 62%

Is your organization a single-unit organization or a multi-unit organization?

For multi-unit organizations, are HR policies and practices determined by the multi-unit headquarters, by each work location or by both?

Multi-unit headquarters determines HR policies and practices. 56%

Each work location determines HR policies and practices. 3%

A combination of both the work location and the multi-unit headquarters determines HR policies and practices.

41%

Corporate (companywide) 75%

Business unit/division 11%

Facility/location 14%

What is the HR department/function for which you responded throughout this survey?

23

SHRM Survey Findings:

Survey Methodology

SHRM Survey Findings: Strategic Benefits—Leveraging Benefits to Retain Employees


Survey Methodology:• Response rate = 12%• 461 HR professionals from a randomly selected sample of SHRM’s membership

participated in this survey• Margin of error +/- 5%• Survey fielded May-June 2015

Project Lead:Karen Wessels, researcher, workforce planning, SHRM Research

Project Contributors:Evren Esen, director, SHRM-SCP, Survey Programs, SHRM ResearchBruce Elliott, manager, SHRM-SCP, Compensation and BenefitsJoseph Coombs, senior analyst, workforce trends, SHRM Research


Additional SHRM Resources

Health Care Reform Resource Page: shrm.org/healthcare

For more survey/poll findings, visit shrm.org/surveys

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About SHRM

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2015 strategic benefits—leveraging benefits to retain employees

Recruiting & HR