When employees are healthy, businesses perform better. Numerous studies have shown the impact employee wellness has on overall corporate success, and businesses are taking notice. A recent survey from Fidelity Investments and the National Business Group on Health found that companies are spending more on employee wellness programs than in the past, especially on the financial incentives used to increase program participation.
Companies Are Focusing on Financial Incentives to Boost Participation
Companies are not only investing in employee wellness programs; they are giving employees reasons beyond improved health to participate. Employers also recognize the powerful motivation of providing wellness benefits to spouses and domestic partners.
- Companies expect to spend $3.6 million on well-being programs in 2019. Of this, 40% is earmarked for financial incentives to increase employee and spouse/partner participation.
- For 2019, the average incentive offered per employee decreased slightly to $762 from $784 for last year. Still, this year’s average is significantly more than the $260 average incentive offered in 2009.
- Although the average employee incentive was slightly down, the average incentive for spouses/partners increased to $601 in 2019 from $596 in 2018. The percent of companies offering incentives to spouses/partners also increased in 2019, up to 58% from 54% in 2018.
- More than half of employers (57%) provide financial incentives in the form of reduced health care premiums and more than a third (34%) provide incentives by funding employee health care accounts (e.g., Health Savings Account, Flexible Spending Account, etc.).
- Employers expect to maintain this trend in financial incentives, with 33% saying they will increase the amount of the incentives to employees over the next three to five years.
Employee Wellness Focus Goes Beyond Physical Health
Businesses have expanded the focus of wellness programs beyond physical health to include a more holistic view that incorporates emotional, social, and financial health. This is key because a lack of well-being in one area of an employee’s life can affect well-being in another area.
A previous Fidelity study showed that when employees lack financial well-being, they are significantly less likely to be physically healthy and are more likely to be stressed or anxious. In contrast, when employees participate in community involvement activities, they have less stress, which may translate to higher levels of work productivity.
Employers plan to continue focusing on a variety of areas of health in their wellness programs, with 92% saying they will include emotional/mental health, 88% including financial health, 69% focusing on community involvement, 54% on social connectedness, and 43% on job satisfaction.
Wellness Programs Expand Globally, With Many Tailored To Local Needs
The survey also provided data on the trend of expanding programs to include global employees and the reasons why employers are doing so.
- Most of the companies surveyed (56%) offer well-being programs to their global employees. This is an increase from 44% in 2018.
- Another 14% of companies surveyed are considering extending their well-being programs to employees in different global locations by next year.
- As businesses expand well-being programs, only 34% have a global strategy in place. Half of the companies let local markets focus on their particular needs.
- The top objectives of well-being programs can vary depending on the country. In the U.S., the top objectives are to manage health care costs (82%) and improve employee productivity/reduce absenteeism (59%). Globally, the top objectives are to improve employee engagement/performance (82%) and align employees with the corporate culture (72%).
The takeaways from the survey are appropriate for businesses of any size that offer or want to offer an employee wellness program. As companies continue investing in wellness programs, those companies that do not offer a program are at a disadvantage.
Companies need to continue to refine their programs to encourage employees to use the benefits. That encouragement may come through financial incentives or including close family members in the benefits. Also, as indicated in responses about global programs, a wellness program must be tailored to the needs of its local employees in order to be effective.
The online survey included responses from 164 jumbo, large, and mid-sized organizations. Responses were collected between October 2018 and January 2019 from National Business Group on Health members and clients of Fidelity Investments.