Gallagher's 2018 Benefits Strategy & Benchmarking Survey – Canada Edition shows how more than 450 employers are leveraging benefit offerings to attract and retain talent
TORONTO, Dec. 18, 2018 /PRNewswire/ -- While 57 percent of Canadian employers plan to increase employee headcount in 2019, that growth could become a financial burden, according to Gallagher's 2018 Benefits Strategy & Benchmarking Survey – Canada Edition. That's because employers will now bear additional healthcare costs, particularly for prescription drugs. Yet a majority (64 percent) don't have an effective strategy for managing healthcare expenses and almost none leverage advanced tactics to cut prescription drug costs.
The survey, now in its second year, includes data from 468 employers across Canada from a variety of industries, showing the challenges facing organizations in attracting and retaining top talent. Its findings also identify industry best practices to help employers effectively meet those challenges.
"Because we are in a tight labour market, organizations understand the importance of offering competitive benefit packages," says Leslie Lemenager, head of Gallagher's Canadian employee benefit consulting operations. "But today's workforce encompasses five generations, and each wants a benefits package that addresses their own individual set of needs. To win the war for talent while keeping costs sustainable, employers need to look beyond the most expensive options and incorporate data to ensure they offer benefits that are cost-effective, competitive and appealing to key talent."
Overlooking Tools to Keep Rising Healthcare Costs in Check
The 2018 Benefits Strategy & Benchmarking Survey – Canada Edition identifies employers' biggest pain points within healthcare. More than half (55 percent) say high prescription costs is a top cost-management challenge, and 64 percent mandate generic or least-cost alternative drugs to cut costs. However, the study finds just 5 percent employ expense management tactics, such as step therapy, streamlining the supply chain or mail-order options, which can significantly reduce drug expenses.
Employers Not Quite There Yet on Holistic Employee Wellbeing Strategies
A common misunderstanding about employee wellbeing and its role in the workplace helps to explain why only 46 percent of Canadian employers have an employee wellbeing strategy. Many employers may not recognize that employees bring their entire selves to work, including their personal challenges, which can impact job performance. As a result, employee wellbeing should ideally take a holistic approach, addressing physical and emotional health, career growth and financial security, among other areas.
With many employees under financial stress, more organizations are offering access to financial advisors or financial literacy education to help employees make smarter saving and spending decisions. The research also finds many organizations actually already have the resources they need to strengthen employee wellbeing or could add voluntary benefits to do so.
Relying on Data to Develop and Measure Benefit and Compensation Strategies
Most Canadian employers believe their benefits are competitive, but base that conclusion on perception rather than data. For example, 60 percent of employers feel their workforce is highly engaged, but only 42 percent have conducted an engagement survey since 2016. In addition, 32 percent say they lack any communication strategy, making benefits education or feedback difficult.
"Employers cannot afford to offer the same healthcare and retirement packages year after year," Lemenager says. "Employee demographics are diverse and their needs are changing constantly. Organizations that recognize this, and continue to adjust accordingly, will do a better job of recruiting and retaining top talent."
For more information about the 2018 Benefits Strategy & Benchmarking Survey – Canada Edition, visit www.ajg.com/CNBS-2018.
ABOUT THE BENEFITS STRATEGY & BENCHMARKING SURVEY
Gallagher Benefit Services, Inc., the employee benefits consulting and brokerage operation of Arthur J. Gallagher & Co., developed the Benefits Strategy & Benchmarking Survey to provide employers with insights into how their peers are addressing benefit and human capital challenges. The 2018 survey, conducted from April to June of this year, aggregates responses from 468 organizations across Canada. Additional survey results can be found at www.ajg.com/CNBS-2018.
Gallagher (NYSE: AJG) is a global insurance brokerage, risk management and consulting services firm headquartered in Rolling Meadows, Illinois. The company has operations in 35 countries and offers client-service capabilities in more than 150 countries around the world through a network of correspondent brokers and consultants.