Benefitfocus, Inc. (NASDAQ: BNFT), a leading cloud-based benefits management platform and services provider, today published findings that suggest that driving engagement and participation in supplemental voluntary benefits, particularly in at least one of five key voluntary benefits, can help increase employee retention rates. The correlation between retention and participation in these benefits is stronger in companies with predominantly younger workers.
In its latest Benefit Insight Brief, Benefitfocus found that employers could see a reduction of up to 8 percent in employee turnover when employees are enrolled with at least one of five specific benefit categories, and those with a predominantly millennial workforce could potentially reduce employee turnover by as much as 24 percent.
Based on a review of anonymized behaviors of four million U.S. employees across more than 450 employers, Benefitfocus has determined that companies could see a reduction in turnover when employees enroll in at least one of these voluntary benefits:
- Accident Insurance
- Critical Illness
- Hospital Indemnity
- Identity Theft Protection
- Pet Insurance
“Our insights show that, as rising healthcare costs outpace wage growth, employers can help optimize employee retention through a robust offering of gap products to supplement healthcare benefits, combined with an active, year-round engagement,” said Seth Gregorie, Senior Director of Engineering and Data Science of Benefitfocus. “Having reviewed information from hundreds of midsize to large companies, we can see that this year-round approach can have a real impact on retention, especially among younger workers.”
Using the estimate provided in the Work Institute 2019 Retention Report that the cost to lose a U.S. worker is $15,000, an employer with more than 10,000 employees could save $1.2 million for every 10 percent increase in participation. Such an increase would result in reduced attrition by 80 people which, multiplied by $15,000, results in the estimated savings.
Designer Brands is one of North America’s largest designers, producers and retailers of footwear and accessories, operating a portfolio of retail concepts in nearly 1,000 locations under the DSW Designer Shoe Warehouse, The Shoe Company, and Shoe Warehouse brands. In 2019, after the introduction of new voluntary benefits through Benefitfocus BenefitsPlace®, it realized higher-than-expected adoption rates – 33 percent for accident insurance, 20 percent for critical illness and 17 percent for hospital indemnity within the first year.
In conjunction with a more positive onboarding experience, targeted communication and enrollment auditing to ensure employees are properly enrolled in plans, Designer Brands believes it is providing new hires with a greater sense of security, cutting down on questions and improving retention efforts.
Benefit Insight Briefs
Each Benefit Insight Brief from Benefitfocus extracts anonymous benefits enrollment data from more than 25 million consumers supported on its AI-powered technology platform, along with demographic data and industry-standard reference points, to provide insight into how consumer behavior and decisions could impact business results.
In the first Benefit Insight Brief, released on February 10, 2020, Benefitfocus published findings that showed that employers who drive an active, year-round benefits experience could be rewarded with up to a 37 percent lower employee turnover rate than their peers. Both Briefs can be found at the Resource Library.
The study dataset was built with anonymized data from 476 midsize to large employer customers (>100 full-time employees) within the Benefitfocus customer base, representing over four million individual consumers in total. The analysis attributes were measured at an employer level and included: total employee attrition rate, additional employer features for industry and average age of employees, and data about activity on the Benefitfocus Platform for the 2019 calendar year. This dataset is not meant to be a nationally representative sample, but rather to represent aggregated data for employers on the Benefitfocus Platform. Your actual results may vary from the findings we discovered.
Connect with Benefitfocus
To see more data insights that can help drive cost savings and improve the consumer benefits experience, click here.