BY Sun Life Financial | March 28, 2013
Generation Y are the fastest growing segment of the employee population. They are a smart, hard-working group that is eager to succeed and have a lot to contribute. But the most compelling reason to factor Generation Y into your clients’ benefits strategy is the growing influence that they will have in the work place in the coming years, thanks to simple demographic forces.
While Generation Y only makes up a quarter of the workforce today, that will swell to about 40% by 20201. And with the overall workforce shrinking as baby boomers retire—expect the fight for talent to intensify over the next decade.
Group benefits are a critical tool for attracting and retaining talent employers who ignore the needs of Generation Y will find themselves at a significant competitive disadvantage. That’s why Sun Life Financial, in partnership with Ipsos Reid, conducted in-depth research to understand what Generation Y employees were looking for in a group benefits plan. The research indicated that this generation has significant needs and preferences that are not being address by traditional benefits plans.
Four key areas for change stood out in the research:
1. More flexibility and control
They expect benefit solutions that reflect their diversity and acknowledge their individualism. They are frustrated by the status quo of “one size fits all”.
Almost three quarters (70%) said they would prefer a flexible benefits plan to a traditional plan. After all, it provides them with the ability to pick and choose benefits that meet their specific needs2.
Employers may want to also consider “add-on” solutions such as Health Savings Accounts (HSAs) and Personal Savings Account (PSAs), where they allot funds to employees to spend on health related expenses at their own discretion.
2. Greater convenience on claims
Manual claims—filling out paper claims forms and putting them in the mail—is seen as an “absurd inconvenience”. This group views online claiming with instant results as the minimum standard. Unsurprisingly, they are very enthusiastic about mobile applications that allow them to submit claims and manage their benefits on the go via their mobile devices.
3. Clear, plain language communication
They want simple, concise, plain language communication that is free of “industry-speak” and they want the option to receive it on their terms—meaning digitally—by text, email, social media and video.
4. More wellness, health and lifestyle benefit options
According to the 2012 Sun Life Canadian Health IndexTM (a national survey of Canadians’ health related attitudes and self-reported behaviours), this group reported the highest level of uncomfortable stress in their lives.
In fact, 90% of Canadians age 18-24 say they have excessive or unaffordable levels of stress at this time and 80% of Canadians aged 25-44 say the same. This compares to 51% for Canadians age 65 and over3.
While Generation Y employees understand the value of core benefits such as medical, dental, vision and prescription drugs, the research found that they have a strong affinity to employers who offer other programs aimed at promoting healthy lifestyles. This includes wellness-related benefits such as subsidized gym memberships, worksite fitness facilities, healthy food programs and reimbursement toward the cost of education or self-development.
Mind the gap
Failing to account for the more progressive needs of Generation Y could lead to a significant “gap” in the perceived value of a sponsor’s plan over time. And this could put organizations at a competitive disadvantage. Advisors who bring solutions now to address these needs will provide significant value to their clients by positioning them to attract and retain Generation Y and harness this generation’s great potential.1 Derived from Statistics Canada 2011 Labour Force Survey; The Public Service Commission of Canada, “Emerging Trends Affecting the Public Service Commission of Canada and the Public Service Employment Act”, 2009
2 2012 Sun Life Financial Survey of Canadians with group benefits coverage
3 2012 Sun Life Canadian Health IndexTM, a national survey of Canadians’ health related attitudes and self-reported behaviours.
This article is sourced from www.smallbizadvisor.ca