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When nearly 50 human resources executives planning to attend the CHRO Exchange were asked ahead of the event what their top three HR priorities were for the coming year, two-thirds of them listed recruiting and/or retaining top talent as one of their main concerns. This common concern reflects the challenges many human resources executives are facing in today’s strong job market. A recent study showed job openings are occurring faster than people entering the workforce or quitting current jobs. And, almost 70% of organizations have reported difficulty recruiting for certain types of jobs. Almost half (49%) cited competition from other employers as a reason for difficulty finding candidates for their open positions.
To be competitive in the talent marketplace, many employers are investing more than ever before into benefits. In fact, the Society of Human Resource Management (SHRM) reported that 1/3 of organizations increased their overall benefit offerings in the last 12 months -- and for good reason. The same SHRM report revealed that 40% of employees would consider the possibility of seeking employment elsewhere in the next year, and while the top reason was higher pay/compensation, the second was better overall benefits. And, possibly more importantly, almost a third (32%) of employees say their overall benefits package is reason to stay with an organization.
The Challenges of Increasing Benefits
While increasing benefits offerings can be an effective way for human resources professionals to improve their talent recruitment and retention goals, the cost of increasing benefits can add up quickly, especially for a large employer. The Bureau of Labor Statistics reports that employers spend 37% of their compensation costs on benefits. So, based on the average size of large U.S. enterprises and the average national salary, the costs of benefits for a big company can average over $90,000. Considering this, it’s unsurprising that even though few organizations (6%) decreased overall benefits in 2017, larger organizations were three times more likely than midsize organizations to have decreased overall benefits offerings in the past 12 months. Most commonly, organizations had to decrease the level of benefits to cost remain financially stable, whether it was due to increasing costs of benefits, economic factors or poor organizational performance.
So, how can a large organization make themselves an attractive potential employer in the competitive talent marketplace while keeping costs down? With three generations in the workforce simultaneously – Millennials, Gen Xers, and Baby Boomers – the answer is more challenging than ever. A report by Benefitfocus analyzing large employers’ benefit data, confirmed that one size does not fit all in employee benefits. Workers’ coverage needs vary with their individual circumstances, including age and income. For employers to attract and retain the best talent, they must continue to offer a wide range of benefit options to fit the wide range of needs present in the workforce. Voluntary Benefits Services (VBS) is one low-cost way many employers are addressing their workforce’s varying needs. However, while VBS protection has grown in recent years its utilization rates are still low on average – 25% or less for most benefits. Thus, while they can add some value to an organization’s package, they can have a lower perceived value than employer-paid benefits.
The Value of Identity Protection as an Employee Benefit
If there is any employee benefits type that bridges the gap amongst generations, it’s financial wellness benefits. Because financial wellbeing is an aspiration that knows no age limit, this type of benefit is applicable to all life stages. MetLife’s 15th Annual U.S. Employee Benefit Trends Study found that 49% of employees are concerned, anxious, or fearful about their current financial wellbeing, and close to three-quarters (74%) of employees state that they gain peace of mind by achieving financial well-being through benefits.
In today’s ever increasingly digitalized world financial wellness benefits have expanded from the traditional offerings of 401k and flexible spending accounts, to include identity protection as well. Once an employee’s personal information gets into the wrong hands, their entire financial profile could potentially be at risk. With just a couple pieces of sensitive data, a savvy identity thief can secure bank loans, credit cards, mortgages, tax refunds, and more in a person’s name. It’s scary stuff that can have some very serious consequences. In fact, in 2017 nearly 30% of consumers reported they are very worried about becoming victims of identity theft. Moreover, because identity theft worries are so prevalent, 58% of consumers say they are likely to purchase identity theft protection services in the next two years. This is on par with the number of people who plan to purchase life insurance in the next two years – also 58%.
Reducing Costs with Employer-Paid Identity Protection
It’s clear then that adding employer-paid identity protection to your benefits package can add value, but the question remains – how can it decrease cost? To understand that, first you should consider what identity theft is costing your organization every year. While the calculation for each organization will vary based on each organization’s employee head count and total compensation costs, our formula below shows that the cost quickly proves to be substantial.
3,286 x 6% = 197 x 175 = 34,503 total workforce hours spent resolving identity fraud cases
$31.95 x 34,475 = $1,102,371 worth of employer paid hours
3,286 - the average number of employees at a large U.S. enterprise
6% - the percentage of consumers who fell victim to identity fraud in 2017
175 hours – the average number of work hours victims spend resolving identity fraud
$31.95/hour – the average national salary hourly rate
The numbers above show how the impact of this crime can add to your company’s bottom line, but how does identity protection save your organization money? Assuming, very conservatively, that identity protection will save only 24% of the 34,475 hours mentioned above – and adding in the cost of our Plus Identity Protection product – your organization could save $200,000 per year! And that's just the most simplistic calculation; when other relevant factors are added into the equation the savings can be even greater for many companies!
Identity protection is an increasingly popular benefit with an estimated 70% of employers projected to offer it as a voluntary benefit in 2018. However, your company can maximize both the value this benefit adds to your overall package and the ROI gained by joining the savvy employers who have already started including identity protection as an employer-paid benefit. How can your organization afford not to? Request a demo today to find out how much offering our identity protection as an employer paid benefit can save your organization.