Here’s how to tailor employee benefits to a diverse workforce

This article is brought to you thanks to the collaboration of The European Sting with the World Economic Forum.

Author: Jaclyn Chen, CEO & Co-Founder, Benepass

• One way for companies to attract a diverse workforce is with employee benefits.
• Workers from different generations have different benefits needs, from fertility funds to student loan support.
• Financial technology makes a flexible benefits program possible for employers.

Workplace diversity, equity, and inclusion (DEI) has become central to modern talent attraction and recruitment. The turbulent political climate and rising social unrest of the past few years have shed new light on the importance of workplace DEI initiatives, and job candidates are seeking organizations that align with their values. According to one survey, 76% of job seekers and employees believe that a diverse workforce is an important factor when evaluating job offers, and nearly a third (32%) would not apply to a company that lacks diversity.

Many people associate workplace DEI with employee resource groups, diverse employee populations, and inclusive hiring practices, but it’s equally important for companies to evaluate their employee benefits. One way to do that is by assessing how equipped their benefits are to meet the needs of a multigenerational workforce globally.

Gen Z

Gen Z workers were born between 1997 and 2012 and are digital natives, having grown up with digital technology. Workers in this age group are more likely to prioritize their well-being and mental health than previous generations. They are also far more likely to take an interest in their employer’s culture and stance on core social issues: 77% of Gen Z respondents say it is important for an organization’s values to align with their own.

To appeal to a Gen Z cohort, organizations should consider establishing wellness programs and building a transparent dialogue with employees. Such initiatives have been shown to attract and retain top talent, reduce burnout, and increase employee satisfaction.

Millennials

Millennial workers were born between 1981 and 1996, and are the largest generation in the US workforce today. They have had an interest in working remotely, even before the COVID-19 pandemic popularized this.

Many millennials are currently building their families, so benefits like great health insurance, dependent care assistance, and fertility funds are particularly appealing. Over 70% of millennials say they would be willing to move jobs for better fertility benefits. This includes generous parental leave, increased flexibility, and coverage for services such as fertility treatments and egg freezing.

Employers with a large millennial workforce may also want to consider benefits that reimburse employees for student loan payments. Over 14 million millennials have student loan debt, more than any other generation. Student loan benefits can be offered through a flexible lifestyle spending account (LSA).

Gen X

Gen X makes up about 33 percent of the US workforce and includes those born between 1965 to 1980. Many have years of work experience while also being considerably more tech-savvy than Baby Boomers. This age group may be in the position of caring for children and parents at the same time.

Because of this, many Gen X employees will value dependent care assistance, as well as affordable health care benefits. US employers can offer a dependent care flexible spending account (DCFSA), which is a tax-advantaged plan that allows employees to allocate pre-tax dollars toward eligible dependent and child care expenses. This benefit program allows organizations to allocate a certain amount of money at the beginning of each year, which will then be deducted pre-tax from employees’ paychecks every month. Outside of the US, employers can provide flexible family and child care benefits that provide funds for employees to use for child care, elder care, and other family needs.

Baby Boomers

Baby Boomers were born between 1946 and 1964. Although some Baby Boomers have already retired, many are working later than their peers.

Baby Boomers have years of experience and insight to offer organizations. They often prioritize traditional benefits like health insurance, vision benefits, dental insurance and pensions. In addition, US employers with a large Boomer population should consider additional health benefits such as a flexible spending account (FSA) or health savings account (HSA). There are a few key differences between these plans, but both offer an opportunity for employers to lower health care costs for employees. On top of the annual HSA maximum, employees who are 55 and older can also contribute an additional $1,000 catch-up contribution, making this account particularly appealing for this age group.

In other countries, employers should understand their requirements for setting up pension schemes to help employees save for retirement. While many global employees may receive free universal health care, companies can also explore opportunities to offer additional support through private health insurance or cash stipends that help employees pay for more specialized expenses.

Boomers who are still interested in working but ready to slow down a bit might be great candidates for job sharing. This work arrangement allows two highly qualified employees to manage one role. Salary may be slightly lower since the role is split, but employees save in other costs such as child care and commuting, while keeping their health insurance benefits.

Discover

How is the World Economic Forum promoting equality in the workplace?

The World Economic Forum’s Centre for the New Economy and Society shapes prosperous, resilient and equitable economies and societies. It takes an integrated approach to promote the new fundamentals of economic growth, good work standards, and better education; embed diversity, equity, inclusion and social justice in the new economy; and identify global risks.

• Through the Partnering for Racial Justice in Business initiative, the Forum is working with a global coalition of organizations committed to building equitable and just workplaces for professionals with under-represented racial and ethnic identities.
• The Forum’s Reskilling Revolution is preparing the global workforce with the skills needed to future-proof careers. The initiative is working with over 350 organizations to provide 1 billion people with better education, skills and economic opportunities by 2030.
• Since 2006, the Forum has been measuring gender gaps in countries around the world in the annual Global Gender Gap Report. The Forum has also helped to establish groups of accelerators focused on closing the economic gender gap in Chile, Argentina, Egypt, Jordan and Kazakhstan.
• Working with the Valuable500, the Forum is collaborating with the largest global network of CEOs committed to disability inclusion, making progress towards closing the disability inclusion gap.

Contact us for more information on how to get involved.

How technology is powering a benefits revolution

When building your benefits, it’s important to consider the unique needs of different age groups. Traditional one-size-fits-all benefits packages are not designed for today’s diverse workforce. With a customized and flexible program, employers can meet a wider set of needs.

Financial technology, or fintech, is the lever that makes these flexible programs possible. Employers can design programs around a set of parameters, make financial contributions at regular intervals, and allow employees to spend their funds however they choose.

To meet the needs of a multigenerational workforce, employers must get creative and leverage modern technology to deliver inclusive benefits experiences that clearly communicate their DEI values to job seekers and employees.